How to calculate and recover Statutory Maternity Pay

If your employee is expecting a baby, she may be entitled to Statutory Maternity Pay (SMP). This replaces her normal earnings to help her take time off around the time of the birth.

You may be able to recover some or all of the SMP you pay. How much you can recover depends on the amount of Class 1 National Insurance contributions (NICs) you pay a year.

Payroll software will usually work out your SMP payments and how much you can recover. Or you can use an SMP calculator provided by HM Revenue & Customs (HMRC).

You can also work out SMP manually using the SMP tables. But using payroll software or one of HMRC's SMP calculators saves time and helps avoid mistakes.

On this page:

Information you'll need to work out SMP

Whichever method you use to work out SMP and recovery of SMP you'll need to gather together the same information.

Information needed to calculate SMP

Before you can start to calculate your employee's SMP you'll need:

  • the date the baby's due - from your employee's MATB1 form
  • your employee's intended date for starting her maternity leave, if she's given you one
  • your employee's gross pay and the dates she was paid in the 'set period' (for a definition please read HMRC's publication E15, 'Employer Helpbook for Statutory Maternity Pay')
  • the date your employee started working for you
  • confirmation that your employee's gross earnings are liable to employer's Class 1 NICs

Download E15, 'Employer Helpbook for Statutory Maternity Pay' (PDF 198K)

Information needed to work out what you can recover

To work out how much of the SMP payments you can recover you'll need to know:

  • the amount of SMP you're liable to pay - this is worked out automatically if you use HMRC's SMP calculator or commercial software that has its own SMP calculator
  • how much your Class 1 NICs (employer's and employees') were for the 'relevant tax year'- you can get this figure from your Employer Annual Return form P35

The later section 'Calculating SMP recovery manually' explains how to decide which is the 'relevant tax year' for working out the total NICs you pay in a year.

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Calculating and recovering SMP using an HMRC calculator

Online calculator

HMRC's online SMP calculator works out how much SMP you'll have to pay and how much you can recover. It's easy to use and does everything for you. The online calculator will work out for you:

  • whether your employee is entitled to be paid SMP
  • the amount of SMP you should pay
  • how much you can recover

You can print the figures worked out by the SMP calculator so they're ready to enter in:

  • the P11 Calculator that comes as part of HMRC’s Basic PAYE Tools package
  • your commercial software (but this may have its own SMP calculator)
  • a paper form P11

Downloadable calculator

A set of Basic PAYE Tools is available to download straight to your computer. In addition to calculators for SMP and other statutory payments, the tools include;

  • an employer database on which you can record employees’ details
  • a P11 calculator that will work out and record your employees’ tax, NICs and Student Loan deductions every pay day with a linked P32 Employment Payment record that works out what you need to pay to HMRC
  • interactive forms such as P11D working sheets
  • a Learning Zone - including interactive learning material on Statutory Maternity Pay

Use HMRC's online SMP calculator

Download Basic PAYE Tools (Opens new window) from the Business Link website

Complete the employer online order form

Payroll calculations and records: an introduction

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Calculating SMP manually

To calculate your SMP payments manually you work out:

  • whether your employee has worked for you long enough
  • whether they earn enough
  • how much to pay them

For the first six weeks you must pay your employee SMP at the rate of 90 per cent of their average weekly earnings.

For the next 33 weeks you must pay them the lower of:

  • £128.73 - from 3 April 2011
  • 90 per cent of their average weekly earnings

You'll find guidance on how to work out average weekly earnings in HMRC's publication E15, 'Employer Helpbook for Statutory Maternity Pay'. Read the section 'Quick method for calculating Average Weekly Earnings (AWE)'. This tells you how to work out weekly earnings for both monthly and weekly paid employees.

Download E15, 'Employer Helpbook for Statutory Maternity Pay' (PDF 198K)

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Calculating SMP recovery manually

How much SMP you can recover depends on the total amount of employer's and employees' Class 1 NICs you pay in the 'relevant tax year'.

The 'relevant tax year is the tax year immediately before the tax year in which the qualifying week falls - this being the 15th week before the baby is due.

SMP - examples of qualifying week and relevant tax year
Due date of baby Qualifying week
(15 weeks before the baby's due date)		 Relevant tax year
(last complete tax year before the qualifying week)
25 June 2010 7 March 2010 to 13 March 2010 2008-09
18 April 2011 2 January 2011 to 8 January 2011 2009-10

You'll find the total of your employer's and employees' NICs for the tax year on your Employer Annual Return form P35.

If your annual liability for Class 1 NICs is £45,000 or less

If your Class 1 NICs are no more than £45,000 in the relevant tax year, you can recover 103 per cent of your SMP payments. For 2011-12 this is made up of:

  • 100 per cent of the SMP
  • 3 per cent of the SMP - this is an additional amount as compensation for the employer's Class 1 NICs you'll have paid on the SMP

You can recover 103 per cent of the total of all payments of SMP made in the same tax month.

If your annual liability for Class 1 NICs is more than £45,000

If your Class 1 NICs are more than £45,000 in the relevant tax year, you can recover 92 per cent of the total of all payments of SMP made in the same tax month.

You might have paid no Class 1 NICs in the relevant tax year - or only paid them for part of it. In this case, you'll need to check to see if you were paying them at the rate of more than £45,000 a year. You do this by working out your average monthly payment and multiplying that by 12.

You'll find a full explanation of how to work out how much SMP you can recover in HMRC's publication E15, 'Employer Helpbook for Statutory Maternity Pay' - read the section 'Recovering SMP'. This explains what period to use to work out your average monthly payment if you paid no NICs for the relevant year, or if you only paid them for part of it.

Download E15, 'Employer Helpbook for Statutory Maternity Pay' (PDF 198K)

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Advance funding for SMP

If you don't have sufficient payroll deductions available to cover the SMP you're entitled to recover, you may be able to apply for funding from HMRC. Follow the link below for more information.

Get help with statutory payments funding

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SMP and salary sacrifice schemes

If you provide benefits to your employees under a salary sacrifice scheme, this can have an impact on SMP. Follow the link below for guidance on this issue. The guidance also provides details of the non-cash benefits employers are required to provide to employees on statutory maternity leave.

Salary sacrifice: an overview for employers

Find out about the impact of salary sacrifice arrangements on SMP (PDF 134K)

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Help and advice

Follow the links below to find out more about SMP.

Statutory Maternity Pay - an overview

Download E15, 'Employer Helpbook for Statutory Maternity Pay' (PDF 201K)

Quick answers to common questions on SMP

Use the SMP email query service

Alternatively you get advice from HMRC's Employer Helpline.

Find contact details for HMRC's Employer Helpline

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