The compensation rate for Small Employers Relief (SER) for statutory parental payments is set to increase from 8.5% to 9%, from 6 April 2026.
Employers can typically reclaim 92% of employees’ parental payments, Statutory Maternity Pay (SMP), Statutory Paternity Pay (SPP), Statutory Adoption Pay (SAP), Statutory Parental Bereavement Pay, Statutory Neonatal Care Pay and Statutory Shared Parental Pay. The recovery is declared each month on the Employer Payment Summary (EPS).
Where a business qualifies as a small employer they can reclaim 100% of the total statutory payments (excluding SSP)plus additional compensation of 8.5% (2025 -2026).
To qualify for Small Employers Relief (SER), the total Class 1 National Insurance Pay bill must be £45,000 (excluding any reductions like Employment Allowance), or less in the last complete tax year which HMRC guidance explains is before:
- The ‘qualifying week’ - the 15th week (Sunday to Saturday) before the week of the due date
- The ‘matching week’ - the week (Sunday to Saturday) your employee was told they’d been matched with a child by the adoption agency
- The date on the official notification if your employee is adopting a child from another country
- The ‘qualifying week’ - the week (Sunday to Saturday) before the death of the child or stillbirth, for Statutory Parental Bereavement Pay
- The ‘relevant week’ - the week (Sunday to Saturday) before the child started to receive neonatal care, unless your employee is entitled to SMP, SPP or SAP, then use the relevant or qualifying week for that statutory payment instead.
It is the employer's responsibility to check the QW/MW/ONW (Official Notification week) of each employee's Statutory Payment to ensure that they continue to qualify for small employers relief.
Small employers that are unable to recover the relief in full from their in-year liabilities for the current year should contact the PAYE Employer Office to ask for a repayment, requests can only be made at the start of the next tax year and should be addressed to:
National Insurance Contributions and Employers Office
HM Revenue and Customs
BX9 1BX
The increase in the weekly statutory payments for SMP, SAP, SPP, ShPP, SPBP, SNCP, will take effect from 6 April 2026 as follows:
- 90% of their gross average weekly earnings for the first 6 weeks
- £194.32 a week or 90% of their gross average weekly earnings (whichever is lower) for the next 33 weeks
Remember also that new rights to unpaid Statutory Bereavement Leave will be introduced from April 2026, see previous newsletters for further details on this.
