Statutory Pay Rates

Employers pay statutory pay to eligible employees through their normal payroll, and Income Tax and National Insurance usually apply. Many employers can claim back part of the cost from HMRC. Statutory Sick Pay is the main exception, as it cannot be reclaimed from HMRC. We can set this up in your payroll and keep your recovery claims accurate.

Incorrect statutory payments can lead to fines or disputes with staff, and may mean that recovery claims need to be corrected. To avoid this, keep your payroll records and rates up to date and check eligibility before making each payment. Statutory rates are reviewed every tax year, so it is worth reviewing your payroll settings at the start of each year. We can review your calculations and put right any errors.

Employers may need to provide Statutory Sick Pay (up to 28 weeks), Statutory Maternity Pay (up to 39 weeks), Statutory Paternity Pay (one or two complete weeks), Statutory Adoption Pay (up to 39 weeks), Shared Parental Pay (up to 37 weeks, depending on unused SMP) and Parental Bereavement Pay (up to two weeks). Each type has its own qualifying rules, rate and maximum period. We can help you understand which payments apply to your employees.

Employees generally need to meet length-of-service rules and earn at least the Lower Earnings Limit. They must also give proper notice and evidence, such as a fit note for SSP or a MAT B1 for SMP. From 6 April 2026, the earnings requirement no longer applies to sick pay, and paternity leave is a day-one right. Self-employed people do not qualify.

For 2026/27, some payments may be calculated at 90% of average weekly earnings (80% for sick pay) where that is lower than the standard rate. The standard SSP rate for 2025/26 was £187.18, and rates are reviewed each tax year. Always check the current rates before running payroll. We can make sure the correct rate is applied for each employee.

Employers can usually reclaim 92% of qualifying statutory payments, or 109% if they qualify for Small Employers’ Relief. SSP cannot be reclaimed from HMRC. Recoveries are reported through the Employer Payment Summary (EPS). We can prepare and submit your EPS so that your reclaims are processed correctly.

Yes. Statutory payments are paid through normal payroll, and Income Tax and National Insurance usually apply, just as they do for regular wages. Payslips should show the statutory payment clearly so that employees can see how it has been calculated. We can handle your payroll so that deductions are applied correctly.

Employers should keep records of their calculations, the employee’s eligibility and any recovery claims. This usually includes evidence such as fit notes or MAT B1 forms, along with payroll records showing the amounts paid. Good records make it easier to respond to HMRC queries and to correct mistakes. We can help you set up an organised system for storing these.