29 January 2025
An earlier version of this news article incorrectly stated "Class 1 A" instead of "Class 1", this has now been corrected below.
In an email from HM Revenue and Customs’ (HMRC’s) Software Developer Support Team (SDST), it has been announced that the Small Employers Relief rate of compensation is to be increased to 8.5% in 2025-26.
Impact on Small Employers' Relief Rate of Compensation
This means that employers who paid less than £45,000 in Class 1 National Insurance (ignoring reductions such as the Employment Allowance) in the last full tax year qualify to claim 100% of the below statutory payments, plus an additional 8.5% compensation.
Applicable Statutory Payments
This applies to:
- Statutory Maternity Pay
- Statutory Paternity Pay
- Statutory Adoption Pay
- Shared Parental Pay
- Statutory Parental Bereavement Pay
- Statutory Neonatal Care Pay
£45k Threshold to Remain
It is confirmed that the £45,000 threshold will remain the same. GOV.UK guidance will be updated soon.
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