Do you get maternity pay if you’re self-employed?
Getting your finances in order before and during a period of maternity leave can be tricky. Of course, while those in full-time employment have the right to access maternity support from their employer, this is not the case if you work for yourself.
Fortunately, self-employed mothers do still have options available to them when it comes to financial support. With the number of self-employed individuals on the rise in the UK, in this guide, we take a look at these options and outline how they differ from those available for expectant mothers in employment.
What is statutory maternity pay?
Statutory maternity pay (SMP) is a regular payment made by an employer to any of its employees who are on maternity leave. Typically, an employer will pay SMP in the same way as they would regular wages. This is to say, if you usually get paid monthly, you will receive SMP each month. If you are paid weekly, your SMP will be transferred into your account weekly. Similarly, just as with regular wages, employers deduct income tax and National Insurance contributions from SMP before paying you.
It is also worth noting that SMP is paid at two different rates:
- For the first six weeks of your maternity leave, you will receive 90% of your average pay. This average is worked out using the money you earned between the period you were 18 to 26 weeks’ pregnant.
- After these initial six weeks, SMP will be paid at a flat rate of £172.48 per week (April 2023 – April 2024), or 90% of your weekly earnings, depending on which is lower, for a maximum of 33 weeks.
Can you get statutory maternity pay if you're self-employed?
Put simply, no. Self-employed individuals do not qualify for SMP or statutory maternity leave. Just as self-employed individuals have different responsibilities than employees when it comes to things such as business insurance and tax requirements, they also have different rights when it comes to maternity pay. However, while SMP is not usually an option, self-employed women can instead qualify for maternity allowance.
What's the difference between maternity pay and maternity allowance?
As touched on above, the chief difference between SMP and maternity allowance comes down to employment status. While SMP is for women in employment, maternity allowance is a benefit provided by the government for women who do not qualify for SMP. This includes self-employed individuals. However, there are still a number of criteria women applying for maternity allowance need to meet in order to qualify. To be eligible, you generally need to have been employed or self-employed for at least 26 weeks in the 66 weeks before your expected due date. During this time, individuals must also be able to prove they have earned a minimum of £30 a week for at least 13 of those weeks.
How much maternity allowance will I get?
As a self-employed individual who meets the eligibility criteria, you can receive between £27 and £172.48 a week for 39 weeks in maternity allowance. The final amount you are entitled to depends on the amount you have made in Class 2 National Insurance contributions during the 66 weeks prior to your baby’s due date.
In order to receive the full amount, you must have been registered with HMRC for a minimum of 26 weeks out of the 66 weeks prior to your baby’s due date. On top of this, you must also have made NI contributions for at least 13 of these weeks. If you have paid less than 13 weeks’ worth of NI contributions, the amount you receive will be calculated accordingly, based on the number of weeks contributions were made.
How do I apply for maternity allowance?
To claim, expectant mothers must complete a Maternity Allowance (MA1) claim form. This can be found on the Department for Work and Pensions website. You will also need to enclose a certificate from your midwife that states your baby’s expected date of birth. Finally, you’ll be required to provide proof of income. This can come in the form of employment payslips or a Certificate of Small Earnings Exemption.
Claims can be made once you are around 26 weeks pregnant. Payments for approved applications will then typically start 11 weeks before your child’s expected due date. While claims can be backdated for up to three months in special circumstances, you do risk missing out on payments if your application is late. With this in mind, it’s important to apply for maternity allowance as soon as you reach the 26 week mark, if possible.
Can you get paternity pay if self-employed?
Unfortunately, there is currently no statutory pay for self-employed fathers looking to take paternity leave in the UK. While individuals who are in full-time employment can take advantage of statutory paternity pay (SPP), there is no equivalent for self-employed fathers.
With this in mind, if you are expecting a new arrival in your family and are not eligible for SPP, you may want to start financial planning early. Fathers in full-time employment are able to take advantage of SPP from the date of their child’s delivery onwards, allowing them to spend some time away from work and with their family. In order to do the same as a self-employed father, think about clearing your diary for your baby’s due date, and perhaps a week or so either side. In order to fund this time off, it’s a good idea to start putting some money aside as soon as you know when your newborn is expected.
While this is completely optional, a rough saving guideline given by charities and support groups is 5% of your monthly income for each week you are planning on taking off work.