hi there all

hope you can help me

do you still get taxed, ni'd and company pensioned off your smp?

just been on a hm revenue & customs calculator n worked it all out that i'd be getting paid ??118.36 a week.

look forward to your responces.

kim
25+5wks

Hi Kim

I believe you pay Tax & NI on it yes....think i read it on here once

Sucks huh???

Lisa 32+5 xx

You don't pay tax on your SMP (after the first 6 weeks) if its your only income (its below the threshold), If your company pays additional amounts then if may go above the threshold and depending on your income the 90% of wage that is paid in the first six weeks may be above the threshold. The company has to pay normal pension contributions as if you were earning your usual wage and you count as having paid NI even if only receiving basic SMP. Not sure if the company pays their contributions, but your ones don't come out of your SMP if you are receiving the basic amounts, again during the first six months and if your company is making additional contributions then you may get charged some.

If you are getting ??118.36/week then it sounds like you are getting 90% of your income throughout, in which case this will be the amount you receive and tax and NI won't be taken from it.

Hugs
GS

Oooo GS I didn't know that
So, to sum up:
I get 90% for 6 weeks - I pay Tax & NI on it
Then for 33 weeks I get SMP - so I don't pay???

Lisa x

Yep you'll get the full ??123.75 (I think its ??123.75 now?) You may have to pay some pension contributions from that depending on your companies policy. I had to pay 2% in order to get my company to pay their contribution, but my 2% was based on the SMP (which was ??112.75 at the time!) meanwhile the company had to pay their contribution on my normal wage

Oh I forgot to mention that you may have to pay minimum pension contribution to get your company to pay their contribution in the bit above. You can choose not to pay your pension, but then your company won't pay either.

I don't have a company pension - so that's ok
I was really only expecting to be clearing ??90-100 p/w on smp so this is a bit of a relief
I know it's not much more but it pays for the nappies etc xx
Thanks

Thats really interesting - I thought we got taxed and NI'd on it all - result - thanks GS! x

it is interesting because i thought we were had tax and national insurance taken out depending on what other tax and national insurance we had paid that year??

Jojo, you kinda do - but because SMP is below the threshold amount (everyone gets almost ??6,500/yr (??125/wk) tax free before tax kicks in) you don't actually pay any.

So would that mean if you have already had your tax free amount for the year i.e from April if you gave birth in say the summer, you would pay tax on it? I have my baby March 18th so will be starting a new tax year in April from zero... x

Wannababy your tax free amount should be spread out throughout the year, So that (if your earning don't change) you pay tax evenly throughout the year. So the tax threshold would works out at ??125/week higher than the SMP hence no tax and NI :\)

I even managed to get tax paid back to me while I was on maternity leave the first time round because all of the thresholds are worked out like that i.e. they took my monthly wage and I pay one level for the first x%, another for the next y% and so on based on what my usual yearly wage was. Then because it dropped so dramatically I had overpaid the tax earlier in the year and got it paid back :\) (Not sure I put that clearly - but the extra money was a nice surprise!!!)

jojo the tax free allowance is spread out over the year so that the tax is evenly spread - otherwise your pay check would be much bigger at the beginning of the tax year than at the end :\)

Oh I see, thanks! x

thank you makes sense now! x

Woah! Goldenshades is one clever bunny! Just the mention of tax sends my head spinning! Lol.

Goldenshades, where does it say about the pension contributions, as I thought I understood it to be as you say, but my boss says that they will only pay 3% of my pay on SMP.

Thanks

Yatg1
http://www.businesslink.gov.uk/bdotg/action/detail?type=RESOURCES&itemId=1080902982

There is a better website somewhere - so I'll look for that link for you too.

The normal company pension contribution is 3% of your pay. So he/she may mean that they'll pay 3% of your present wage during your SMP.

here its is:
http://www.direct.gov.uk/en/Parents/Moneyandworkentitlements/WorkAndFamilies/Pregnancyandmaternityrights/DG_175088

Actually reading over the two of them again the first one is the clearest!

[Modified by: GoldenShades on November 06, 2009 05:03 PM]

I wouldn't go that far squiggle, but thanks

I just work for a little company so was heavily involved in working out all my maternity leave stuff and SMP the first time round - I was also only the 2nd person to go off on maternity!