Beyond the balance sheet

How to reclaim for UK statutory paternity leave & shared parental leave

Ercan Demiralay 29/11/2019 4 minute read

Ecan Demiralay FCCA examines the alternatives to maternity leave and what SMEs need to know about parental leave.

For most small businesses maternity leave is a somewhat complicated process!

That's not just from a financial perspective, but also all the administrative requirements and the strain this can place on the operational side of growing a business.

Maternity leave isn't the only option when it comes to the UK's parenting leave system. It's actually based on a maternity and paternity model. UK statutory paternity leave and shared parental leave have their own set of requirements and financial commitments that employers need to be aware of. As with maternity leave, it's possible to recover some of the expenditure incurred.

Prepare your payroll for paternity leave and plan ahead for other SME challenges


To qualify for SPL fathers or partners must meet one of the following criteria:

  • Be the father of the child or;
  • The adopter of the child or;
  • The partner or husband of the mother (or adopter) or;
  • The intended parent in the case of surrogacy arrangements

There is some leeway in when this leave can be taken. As an employer you should be prepared to be flexible with cover arrangements, some situations may call for unexpected or urgent leave.


When does SPL start?

  • The time of leave cannot begin before the date of birth; or on the date of placement for adoption
  • Leave can be taken as two one week blocks or two consecutive weeks
  • Time of leave has to be taken within 56 days of the actual date of birth

How much is SPL pay

The statutory pay is £148.68 a week or 90% of your employees weekly earnings (2019/20 tax year), whichever is lower and it's important to remember that tax and National Insurance are still required deductions.

How to claim back paternity pay as an employer

Claiming back paternity pay can be a bit of a complicated process for small businesses. How much you can reclaim depends on the size of your business.

Larger employers who paid more than £45,000 in Class 1 National Insurance will normally be entitled to claim back 92% of the payments. If your business qualifies for Small Employer’s Relief you will be entitled to claim more.


If your business has paid less than £45,000 in Class 1 National Insurance contributions over the last tax year, then you are eligible to claim the full sum of the paternity and shared parental pay.

Alternatively some families can opt to take a different option to maternity and paternity leave.


Your employees will be eligible if:

  • They share the responsibility for the child with their partner
  • Remain with the same employer while taking the shared leave

In either circumstance, employees who wish to take paternity or shared leave must be employed by you for at least 26 weeks by the end of the 15th week before the baby is due.


It's important to ensure your payroll software, if you use such a product, has the ability to:

  • Calculate your claim and;
  • Put the paperwork together for HMRC to process your refund

You may encounter other special circumstances within your back office finance function that may require the help of an experienced professional. Where this is the case, be sure to enrol the services of a good accountant so that you stay compliant with all the intricacies of operating a payroll.Free guide on business challenges, Wellers

The content of this post is up to date and relevant as at 26/11/2019.

Please be aware that information provided by this blog is subject to regular legal and regulatory change. We recommend that you do not take any information held within our website or guides (eBooks) as a definitive guide to the law on the relevant matter being discussed. We suggest your course of action should be to seek legal or professional advice where necessary rather than relying on the content supplied by the author(s) of this blog.


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