Statutory Mat Pay taxed but not Maternity Allowance...?

[R&A]

Does anyone understand the logic behind this?

Statutory Pay is salary based

Maternity Allowance is self employed maternity pay

[Ruth_Baldock]

...Or Mat. Allowance can be if you've not earnt enough/been in your job long enough to qualify for SMP, or are a temp (which is how I qualified).

[Keef]

Same as Mrs Keef, they'd mesed about with her contract for so long, that by the time she went on leave, she'd been permanent about a fortnight too little... Kind of makes you wonder...

[R&A]

Still not clear on logic in terms of why would one population of woman pay tax and the other not? Self emplyed v salary based

I can understand if temp or not earned enough. That makes sense. But the former?

Keef - surely a gd thing for mrs keef if it meant she didn't pay tax on her mat pay? Or did they wiggle out of paying her a much better internal company package?

[Ruth_Baldock]

Dunno what Mr and Mrs Keef's take on it, but Mat. Allowance is paltry (I get around ?200 a month) which is nowhere near what I was earning in my temporary contract. It also only lasts for 9 months. I would rather have had a guaranteed job to go back to and paid tax on my Mat. Pay...

I AM going back to work, but out of sheer luck- my previous boss seemed to love me and gave me first refusal when my replacement left, otherwise I'd be up a certain creek without the proverbial paddle.

[Keef]

Yeah Mrs Keef works for NHS, and would have been better off on mat pay, even after tax.

[R&A]

My maternity allowance (self employed) is ?500 a month?

and i think stat maternity pay for salaried people is about the same?

but one is taxed and the other isn't

still not clear as to why but your posts suggest it's because most people on Maternity Allowance are generally worse off in terms of support and so therefore they're exempt from tax

i still think it's slightly odd/unfair though

[monniemae]

SMP and MA are exactly the same amount.

[barrybrains]

The amount you receive for Maternity Allowance is based on your previous earnings. At the highest end, it will be the same as SMP.

I'm glad MA is not taxed. As a self-employed mother, for me to take time off work means several months of not earning anything, plus losing several clients who will go elsewhere and sometimes not come back, so it has longer term ramifications for me to be out of work whilst bringing up baby. For someone on SMP, at least you know when you go back to work it will but at your full salary rate, but for me, it took a long time to get my business going again. I'll obviously face this problem each time I have a child.

[new mother]

it is basically a disaster being self employed and having a baby. you lose badly.

Compare with being employed where, as has happened for many of my friends, some women get six months to a year off on full pay, plus protected bonuses (a bonus for not being present in the office??). and then get statutory mp when the employer's cash ceases. plus various paternity allowances etc blah blah blah. they also generally get private health free or heavily subsidised.

I pay the usual whack of tax plus heavy national insurance. I use private healthcare and education so I cost the country nothing there and I lose out on eg nursery vouchers as self employed, by definition, cannot do salary sacrifice. Health and education are my choice so I suppose that's hard cheese but the rest of it? I feel like I am supporting everyone else and getting next to nothing back.

Oh I forgot, they are actually remarkably efficient at bin emptying in my street. hurrah.

[barrybrains]

Not totally a disaster. The benefits for me are spending more time with my daughter as I don't have to commute, I save money on nursery as I can do my work later in the day when she is asleep, so it works out pretty well.

new mother, I can see that it's a bummer for you as you are paying lots of NI and tax :(

[jollybaby]

  Quote

Dunno what Mr and Mrs Keef's take on it, but Mat. Allowance is paltry (I get around ?200 a month) which is nowhere near what I was earning in my temporary contract. It also only lasts for 9 months

I don't think it's usual to get any form of mat pay beyond 9 months including SMP. I too work for the NHS - known for being one of the more generous employers and after 6 months I'll be receiving maternity allowance alone (not SMP as I've recently moved trusts) and any leave after 39 weeks will be unpaid. I don't know how it exactly works out but I've been assured that my take home pay including mat allowance will work out the same as if I was receiving SMP.