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Small employer's relief

All employers can reclaim some, if not all, of the statutory maternity pay (SMP), statutory paternity pay (SPP) and statutory adoption pay (SAP) that they pay to employees.

If you’re classed as a small employer, you can reclaim 100% plus 3% in small employers’ relief. Otherwise, you can reclaim 92%.

Who qualifies as a small employer?

Your company normally qualifies for small employers’ relief if your liability for national insurance (NI) contributions was £45,000 or less in the last complete tax year prior to the employee’s qualifying week, or in the case of adoption, the matching week. If you’re a new employer, it depends on what you’re forecast to pay over a year.

If you’re unsure whether or not you qualify for small employer’s relief, HMRC can confirm this for you.

To claim small employer’s relief

You claim the relief when you’re preparing a P32/EPS submission. On the first window of the P32/EPS wizard, simply choose Yes in the Eligible for small employer’s relief drop-down list.

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