Maternity Pay Tax

[sistermag]

Hi all,

I am about to start my maternity leave and I wobder d of anyone could explain to me how tax works on maternity pay as I can't seem to et a straight answer. Do I continue to pay tax and ni as normal, even though I will be paid just £139 per week? Or is it tax free? Sorry if this is a silly question, but I am trying to put together budgets for my time off! Thank you!

[sistermag]

I am very sorry for the spelling on this post! I'm on my phone and could not see what I was typing!

[Pigletion]

According to this, tax and NI will be deducted - https://www.gov.uk/maternity-pay-leave/pay

//Statutory Maternity Pay (SMP) is paid for up to 39 weeks. You get:

90% of your average weekly earnings (before tax) for the first 6 weeks
£139.58 or 90% of your average weekly earnings (whichever is lower) for the next 33 weeks
SMP is paid in the same way as your wages (eg monthly or weekly). Tax and National Insurance will be deducted.//

There is also a calculator on there which may help with budgeting.

[Calibax]

You will be taxed as normal but if your tax code is 1100L for example
the first £11000 pa (£211 per week) is tax free, so you will probably
pay no tax.

[fiction-factory]

I am pretty sure £139 is below the NI threshold which is a weekly figure rather than cumulative.
Assuming you have been working all this tax year so far and have been paying tax based on the full personal allowance weekly/monthly rate, you will find that when your income falls to £139pw you will start to get some of the tax back each week that you have previously paid as your projected earnings figure for the year will reduce. I cannot see how any tax will be deducted in future weeks/months unless you underpaid significantly earlier this tax year

[New Judge]

Yes, the current NI Threshold is £155pw.

[Islay]

Don't forget to let tax credits know that you are on maternity leave and getting maternity pay.