EIM76390 - Statutory parental bereavement pay: summary

Part 10 Chapter 3 ITEPA 2003

Employed parents who lose a child under the age of 18, or those who suffer a stillbirth from 24 weeks of pregnancy, are entitled to 2 weeks of Parental Bereavement Leave as a ‘day one’ right from 6 April 2020.

Parents with at least 26 weeks’ continuous service with their employer (up to the Saturday before the child’s death or stillbirth) and weekly average earnings of at least the Lower Earnings Limit are also entitled to Statutory Parental Bereavement Pay (SPBP).

SPBP is paid at the statutory rate, or 90% of average weekly earnings, whichever is lower. Leave and pay can be taken as either a single block of one or 2 weeks, or as 2 separate blocks of one week taken at different times. The employee has 56 weeks from the date of their child’s death to take the entitlement.

Employers are responsible for administering the scheme and paying their employees the amount to which they are entitled. HMRC is responsible for ensuring that employers correctly administer the scheme and for providing employers with the funding to which they are entitled.

Any enquiries about entitlement to SPBP should be dealt with initially by the Employers’ Helpline.

(This content has been withheld because of exemptions in the Freedom of Information Act 2000)

For more information on SPBP, see the SPBP Employer Guide on GOV.UK.

SPBP is taxable.

SPBP is not a social security benefit but replacement earnings charged to tax as employment income.

An employer is still required to pay SPBP even if the employment ceases. If an employer fails or refuses to pay SPBP, HMRC will pay SPBP direct to the claimant but without operating PAYE. Where payments of SPBP are not paid by the employer, for example if HMRC pay them because the employer is insolvent, section 660 ITEPA 2003 ensures that the payments are charged to tax as social security income.

National Insurance contributions are payable on SPBP.

Interaction with other pay

SPBP does not affect an employee’s right to any other remuneration provided by their employer. However, SPBP can be offset against any other remuneration paid by the employer for the same period.

SSP will be paid in place of SPBP if the employee is absent from work because of incapacity, however the employee has 56 weeks to claim SPBP so will be able to claim at a later date if this applies.

How employers recover the cost of SPBP

The SPBP legislation allows the employer to recover the cost of paying SPBP by deducting 92% of the amount from the National Insurance contributions and income tax payments due under the PAYE system. Small employers (those with a NICs liability of £45,000 or less in the preceding tax year) may deduct 100% of the SPBP paid plus a set percentage as compensation (Small Employers Relief).

Use of the abbreviation SPBP

The abbreviation SPBP is used in BEIS literature and certain PAYE, National Insurance and Statutory Payment guides and forms. You can use this abbreviation when dealing with employers, collectors and other tax offices.