Taxed on Maternity Pay

[CupidStunt24]

Hello,

I'm wondering if there is anyone about that understands tax etc (at least a little more than me!). I have been on hold to HMRC for a long time and now just been cut off...

I have been made redundant and worked my last working day today. I worked full time and I am also 28 weeks pregnant. I received my final payslip today along with P45. My employer has paid my Mat Pay in a lump sum. So I have received final salary, redundancy payment and SMP in one go on the one payslip. My redundancy is well below the tax and NI threshold so I haven't paid tax on that. But I have been taxed a quite a large amount. I know it says on the HMRC website that tax and NI deductions are made on SMP. However, I have just checked previous payslips when I was on maternity leave with my first child and was being paid SMP monthly as normal and I wasn't paying tax on it. Is it because I have been paid a lump sum, even though it clearly states "parental pay" on my payslip?

Any help would be much appreciated!

They will have taxes you on the mat pay as though this month is the same as every month. You might have to wait until the end of the tax year to get it back so they can calculate your full income and tax liability for the year (excluding the redundancy). I imagine you won’t be working again now until after at least the year end.

Thank you for explaining! I knew there must be a reason somewhere I just couldn't work it out. No, I won't be working now until after "mat leave" (although it's not technically Mat Leave as I'm no longer employed). Will the tax rebate be an automatic thing from HMRC? IE. My employer wouldn't have anything to do with it? As my work has "closed down" so there are will no longer be employees, employees, payroll etc.

Yes at the end of the year they'll look at your income and work out the correct tax and refund you, often by cheque unless they have your bank account details for any reason. They're actually surprisingly good at this!

However if overpaying the tax will leave you in difficulty do still speak to them and explain, they might be able to refund earlier.

Ah ok that makes sense. I need to get better at understanding life in general, I feel so clueless in general regarding things! Thank you so much for your replies, I really appreciate it

If you're not going to have any employment income or taxable benefits for the rest of the tax year, you don't need to wait until the end of the year to claim back any overpaid tax - if you search Form P50 then you can fill that out once you've been unemployed for more than 4 weeks

You'll get a rebate, same happened to me when i was made redundant and got all my mat pay in one go

In this case remember to apply for child benefit when you have baby so that you get your national insurance paid/credits

You'll get it back in April. Not helpful now though

Thank you all! Managed to get through to HMRC today and explained, initially he said that it was right, that that was the tax that was owed and I wouldn't get a rebate on it. I had to ask a lot of questions and clarify my situation several times for him to look at it again and confirm that I in fact will get a rebate! He said I needed to be I employed for 4 weeks before they can claim it (as PP advised, thank you!). He said to call back after 9th Jan and they will process it. Thank you all so much for your responses