HMRC has launched new online tools to help parents understand their eligibility for shared parental leave (SPL) and plan how to use it. ICAEW’s Tax Faculty explains how mums and adopters can opt in even if not sharing with a partner
On 17 June the government launched two tools to make it easier to check whether parents are eligible for shared parental leave and pay and help them decide how to share the leave that is available.
The tools aim to translate detailed rules into a simple process and support parents in planning their leave and pay, as well as ensure that they are providing the correct notice and information to their employers.
While the tools are aimed at parents, employers also can use them to check if a member of their staff is eligible for the scheme, or to sit down with a member of their staff and work through their plan of when they will be off work.
Although it is widely known that parents can share statutory shared parental pay (ShPP) and leave (ShPL), it is less common knowledge that mums/primary adopters can curtail their statutory maternity or adoption pay (SMP or SAP) and leave (SML or SAL) and take ShPP and ShPL instead – there is no need to share with anyone as long as their partner would have been eligible.
Why does this matter?
Both SMP/SAP and ShPP pay out for 39 weeks and SML/SAL and ShPL provide 52 weeks’ leave. However, these statutory benefits differ in that for the first six weeks SMP/SAP can be paid at a higher rate if mum/primary adopter is eligible before dropping to a flat rate, whereas ShPP is payable at the same flat rate throughout, and SML/SAL has to be taken as one continuous block whereas ShPL can be taken in weekly blocks within the 52 weeks.
The ability of mum/the primary adopter to change from SMP/SAP & SML/SAL to ShPP & ShPL means that they can take SML/SAL and if entitled receive the higher rate of SMP/SAP for six weeks and then switch to ShPP and ShPL and agree with their employer which weeks within the 52 weeks to take as ShPL. This enables mums/primary adopters to go back to work (as long as it’s for at least a week at a time) and arrange for other family members, say, grandparents, temporarily to look after the child(ren) whilst earning money to fund the next chunk of shared parental leave.
Access the tools:
More support on tax
ICAEW's Tax Faculty provides technical guidance and practical support on tax practice and policy. You can sign up to the Tax Faculty's free enewsletter (TAXwire) which provides weekly updates on developments in tax.
Sign up for TAXwireJoin the Tax FacultyTax Faculty
This guidance is created by the Tax Faculty, recognised internationally as a leading authority and source of expertise on taxation. The Faculty is the voice of tax for ICAEW, responsible for all submissions to the tax authorities. Join the Faculty for expert guidance and support enabling you to provide the best advice on tax to your clients or business.