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HMRC internal manual

Decisions and appeals for National Insurance Contributions and Statutory Payments

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HM Revenue & Customs
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Notices of decision: Wording of statutory payments decisions: Introduction to recovery of statutory payments and NIC compensation decisions

Some of the persons liable to pay statutory payments are entitled to recover some or all of the statutory payments they pay to their employees. They can recover it from payments they make to HMRC for their National Insurance contributions (NIC) and PAYE income tax, Student Loan repayments or Construction Industry Scheme deductions, see

  • SPM10900 - Statutory sick pay (SSP),
  • SPM21200 - Statutory maternity pay (SMP),
  • SPM31200 - Statutory adoption pay (SAP),
  • SPM41200 - Ordinary statutory paternity pay (OSPP) (previously called statutory paternity pay).
  • SPM46000 - Additional statutory paternity pay (ASPP)

For SMP, SAP, OSPP and ASPP employers can generally recover 92% of the payments they make to their employees. Small employees (see SPM21305) can recover 100% plus an additional compensation payment Also, in certain circumstances, those persons liable to pay statutory payments can claim NIC compensation on payments of SMP, SAP, OSPP and ASPP.

Section 8(1)(g) of the Social Security Contributions (Transfer of Functions, etc.) Act 1999 or Article 7(1)(g) of the Social Security Contributions (Transfer of Functions, etc) (Northern Ireland Order 1999 allows for decisions to be made about recovery and NIC compensation claims in respect of SSP and SMP. Section 8(1)(ga) of the Social Security Contributions (Transfer of Functions, etc.) Act 1999 or Article 7(1)(ga) of the Social Security Contributions (Transfer of Functions, etc) (Northern Ireland Order 1999 allows for decisions to be made about recovery and NIC compensation claims in respect of SMP, SAP, OSPP and ASPP.

Contact PSN (Statutory Payments Technical Team) if you need to issue such a decision.

If an employer who has paid statutory payments has recovered too much they will have underpaid National Insurance contributions (NIC). In such cases where the employer will not accept that they have recovered too much, add a decision about liability to pay NIC, see example 3 in DANSP37100.

For examples of decisions see DANSP37100.