SB: Maternity pay - very confused!

sarah1980

Not sure if this is the right place to post this.

I own a small business (1-woman-band). I discovered that I was pregnant in June, and baby is due in February '09.

I have rung JobCentrePlus and they don't seem to understand where I'm coming from. I have been an employee of my company for over 6 months, therefore I would usually be entitled to maternity pay. However, theoretically when I am on maternity leave there will be no money coming into the business, therefore I cannot afford to pay myself maternity pay.

I don't plan to take ages off, perhaps 6-8 weeks after baby comes along, but still that is 6-8 weeks where I won't be "paid".

I was trying to figure out whether I would be entitled to Maternity Allowance but JCP said to do this I would need to my employer to complete the form SMP1 which explains why I cannot claim Statutory Maternity Pay. Trouble is, none of the reasons on the form apply to me!

Any advice would be gratefuly received.

Colin2511

hi, are you a ltd company or a sole trader?

we are a ltd company (me and hubby), and when I was pregnant, I paid myself only SSP - BUT as I was a small employer with less than c45K NI payments per year (I cannot remember the exact figure), I could claim this back at 104.5% (100% + 4.5% compensation), I could also apply for an up front figure to pay this, rather than reducing off each months tax bill

I went on a course from Inland revenue, and they explained it all, and what we could claim etc

I am sorry I do not know what to do if you are a sole trader, I am sure my friend got told she could claim nothing (self employed interior designer), but I might be wrong there

sarah1980

I am Ltd company. Colin - does that mean I don't have to wait till year end to "claim back" the 104.5%? Because I cannot afford to pay myself for the 2 months when I'm not working and wait till Y/E to get it all back.

gordonstights

So if you are a Ltd Co, and you are employed by the company then you should be able to claim you SMP back from HMRC. I have just spoken to my accountant about this as I am a director in a small firm & going to be on maternity leave around the same time as you. My accountant said he would get all the details to me asap, but he says I can claim 100% of the SMP back and a compensation fee as well.


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sarah1980

gordonstights wrote: »

So if you are a Ltd Co, and you are employed by the company then you should be able to claim you SMP back from HMRC. I have just spoken to my accountant about this as I am a director in a small firm & going to be on maternity leave around the same time as you. My accountant said he would get all the details to me asap, but he says I can claim 100% of the SMP back and a compensation fee as well.

Thanks for this, but what I'm saying is, can you claim it back weekly/monthly? Because if you have to wait till year end to claim the whole lot back that will be a long wait...

gordonstights

sarah1980 wrote: »

Thanks for this, but what I'm saying is, can you claim it back weekly/monthly? Because if you have to wait till year end to claim the whole lot back that will be a long wait...

How often do you pay your PAYE/NI to HMRC? We make monthly payments to Cumbernauld and if there is any SMP/SSP involved it would be deducted off the payment, therefore reducing what you owe.

sarah1980

Annually. Perhaps this is something I should change though.

gordonstights

I've just read that you can get SMP recovered sooner despite paying your PAYE/NI quarterly or yearly. This link might help, but if you contact HMRC they may be able to send you a claim form?

http://www.hmrc.gov.uk/employers/statpayments-recovery.htm

Colin2511

sorry not been on the board, the company (ie hubby and me), got the payment prior to me going on maternity leave, - it stradddled 2 tax years, so they did it in 2 stages, but was basically "front funding"
hope that helps

also hubby liked the idea of 4.5% compo, and that the gvt were paying me to be pregnant...

cmac

hi ive just beeen reading your posts im an employer and in a mess because of front funding for 3 girls that were off last year on MAT so my advice regards this is to really check you ve got the correct amount not overpaid or you ll end up with a big bill to pay back at the end question your accountant re the figures 100 times if necessary and do the calculation your self ive got 3K to now pay back and dont have it
you should be able to claim 6 weeks at 90% of your normal wage then 117 i think (that was last years figure) so maybe a little more for 34 weeks
I hope that helps and I just dont want anyone to be in the same mess as me its horrible
best of luck

gordonstights

cmac - that's unfortunate

3K is a lot to overpay by... how did that happen? Did you give full pay for a long time or something?