Maternity pay - when does HMRC give it back?

[ilovewinterpansies]

As an employer, I understand that the SMP you pay to your nanny employee is paid back to you by HMRC.

What I can't find out online is when they pay this back to the employer.

Any advice/experience?

You put in a claim and HMRC pay it in advance. My nanny is going on maternity leave in a few weeks, we use a payroll provider who put in a claim when we gave them her MatB1, and I got a cheque from HMRC last week.

I had to find this out for my then employer when I was pregnant. The short answer is that its deducted from the tax pool which is paid to HMRC. If there isn't enough you can claim it from hmrc. I think this link explains it. I'm not a payroll person so apologies if this is incorrect
www.gov.uk/recover-statutory-payments

Ok that's brilliant thank you so much.

So unless I'm missing something, it shouldn't cost me anything to have my nanny go on maternity leave?

Obviously there's the hassle of a replacement but I mean in monetary terms...?

So unless I'm missing something, it shouldn't cost me anything to have my nanny go on maternity leave?

The cost you will have is that whilst on maternity leave they will build up holiday entitlement. That holiday is taken at some point, so that is a cost to you.

HMRC typically send one payment for SMP for each tax year. It can take a while to get the payment, so the sooner your nanny gives you the MAT B1 the sooner your payroll provider can start the process of making the claim for you. If you do payroll yourself then you need to follow the process to recover Statutory Payments, look at section on advance funding.

So unless I'm missing something, it shouldn't cost me anything to have my nanny go on maternity leave?

As a small employer you get 103% of the SMP back, which should cover the SMP itself plus administrative costs etc. I think you still have to pay pension costs, plus tax and NI. I still have to pay the ~£200 costs for my payroll provider throughout the year too. So it might still cost you something but fairly marginal compared to the costs of the SMP.

If your nanny is in a workplace pension scheme with you, she is entitled to continue to receive your employer pension contributions based on her normal pay and not the reduced SMP amounts.
This is a helpful read:
www.pensionbee.com/blog/2018/june/what-happens-to-your-pension-during-maternity-leave

Thanks for all the advice. Really good to be reminded about holidays and pension.

Thanks all 😊