To still feel a bit like I got shafted?

[Toastandcrumpets]

When I left work to go on maternity leave, I received my maternity pay in one lump sum. This meant my tax payments, NI contributions, pension and student loan were all crazy high. I got some tax back but not the rest.

It meant for nine months maternity leave I had less than four thousand pounds.

I still feel annoyed!

This has happened to me in august (I got made redundant at 37 weeks pregnant) but as far as I can see I’m no worse off than I would have been if the payments were staggered.

@Toastandcrumpets Would you mind explaining why you feel you have less money so I can double check my own situation (I’m not that tax experienced so I’m worried I have missed something)?

Sounds like the company decided to get you off the books so you didn't continue to accrue holiday whilst off on maternity

The thing is you told them you were not returning, thus you terminated your contract.

They've simply paid you what they owe you.

The issue, bitter pill as it is, is that you didn't think it through.

I've just looked it up on maternity action website and it says if you resign at the beginning of maternity leave your employer may decide to pay you a lump sum and to be aware this may result in higher NI contributions for you and your employer.

I didn't know this was legal either. How annoying for you if you weren't aware of the potential consequence of resigning at that time.

It won’t have been for holiday - I teach.

I would never turn to AIBU for advice.

No, they've acted on OP terminating her contract. Which means they can also recruit to replace an employee.

It is shitty but legal. I would contact the student loans company and you can claim back the student finance you paid as you didn’t earn enough to pay student finance over the year(I’m presuming so as you got your tax back)

It sucks, but I think it's one of those that gets filed in the 'Shit Happens' folder unfortunately.

But you haven't asked for advice. you have also rebuffed questions from people trying to understand the situation so they could give you advice.

You should have asked for advice before you terminated your contract.

Also you wouldn't have paid more tax unless you crossed tax bands, you'll have simply been taxed on earnings. You may get more back in April when the tax year ends, but you should get advice from a tax specialist on that.

The NI, student loan and pension contribution would surely have been the same whether spread out over a period of time or in one lump sum, unless I’m being stupid?

It would have added up to the same, but it would have been more 'manageable' month to month than a large amount being taken in one go.

This is why I didn’t ask for advice.

I didn’t terminate my contract. None of this is important or relevant. Several months on it is just a bit annoying.

And I feel really upset and stressed now and to be honest like a thick incompetent fool thanks to all the faces when really all I was doing was having a bit of a moan.

Maybe I am a thick incompetent fool. But stil.

@iklboo

The NI, student loan and pension contribution would surely have been the same whether spread out over a period of time or in one lump sum, unless I’m being stupid?

It would have added up to the same, but it would have been more 'manageable' month to month than a large amount being taken in one go.

Only if you're an imbecile who is unable to stop yourself pissing money away.

They weren’t the same - higher amounts.

Hi,

I was made redundant after my qualifying week and therefore I was also given my MAT pay in a lump sum.

I was also taxed/student loaned massive amount but I did get it back. You need to contact Student Finance directly. I explained the sittuation and they refunded me. Hope this helps you claw a bit more back.

Good luck!

So who did terminate your contract then?

I have tried but it’s no go due to COVID and I am back at work now.

I got £4,530 just in monthly payments instead on statutory maternity pay, so sounds quite similar?

Mine was less than that - £3500.

Temp contract.

I would never turn to AIBU for advice.

But by default you're here asking if you are being unreasonable. And so by not giving the full context, being shot with people and leaving them confused, YABU. While on the matter of shafting, it seems you are also BU because you should've made yourself aware of this consequence of your action as the PP easily found a warning about it on the maternity site. That said, YANBU to be annoyed because losing money is annoying. But you wouldn't need to ask if YABU about that.

Student loan and NI are calculated on a monthly basis @GivenchyDahhling, unlike tax which is calculated over the whole year, so if you get a large lump sum in one month rather than the same amount spread out over several months, you do end up paying more NI and student loan, and you don’t get it back

I didn’t realise that, I assumed it was just a set percentage regardless. How frustrating OP. I can’t imagine there is much you can do about it now unfortunately but not the stress you need with a small baby.

Tax will work itself out over the year, annoying as it is right now.

Possibly the same for student loan, because it's a percentage over a certain salary, so if you don't earn enough, you should get some of it back.

However, I think NI is worked out weekly, so you might lose out there. You might also want to check if you've had the right amount of NI credits, although if you expect to work most of your adult life, its probably irrelevant as there's plenty of 'spare' years to catch up.

But really annoying and potentially leaving you short right now when you need the money the most.

You said you told them you were not returning. That is the definition of terminating your contract.

You just spread your 3,5k out and claim back the SL and tax. Simple and no different to phased payments.

You can’t claim back the SL and as I’ve said I’m back at work now anyway.

It is done. I don’t need several more pages of what a useless piece of shit I am, I know that already thanks.

Provided that you don't earn over the threashold for paying student loan back for the tax year though (unlikely to on MAT Leave) if you contact student finance they will refund you. You do have to wait until the tax year is up, so they can ensure you won't reach that threshold before the tax year is up

@GivenchyDahhling

The NI, student loan and pension contribution would surely have been the same whether spread out over a period of time or in one lump sum, unless I’m being stupid? It’s not a variable rate presuming you’re normally over the student loan repayment threshold and your pension contribution doesn’t change with income like eg teaching pensions?

You might still have more tax coming back to you on top of what you’ve had if it doesn’t add up though.

My student loan, NI and pensions go up depending on how much I get paid. So when I get a bonus these payments go up for me. So if a lump payment is made I think they do fluctuate.