DWP: All Documents

Scheduled Event - 27 Oct 2025, 2:30 p.m. - Add to calendar
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Commons - Oral questions - Main Chamber
Work and Pensions (including Topical Questions)
Department: Department for Work and Pensions

Scheduled Event - 1 Sep 2025, 2:30 p.m. - Add to calendar
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Commons - Oral questions - Main Chamber
Work and Pensions (including Topical Questions)
Department: Department for Work and Pensions

Written Question

Small Businesses: Parental Pay

Friday 1st August 2025

Asked by: Baroness Penn (Conservative - Life peer)

Question to the Department for Work and Pensions:

To ask His Majesty's Government when the threshold for qualifying for Small Employers' Relief was last up-rated, and from what level.

Answered by Baroness Sherlock - Minister of State (Department for Work and Pensions)

Small employers (those who have gross Class 1 National Insurance contributions liability of £45,000 or less in the previous tax year) can claim what is known as Small Employers Relief and can recover 100 percent of Statutory Maternity Pay they have paid out plus an additional compensation payment. This additional compensation payment is known as Small Employers’ Compensation and seeks to support small employers with the associated costs of having an employee on maternity leave which are not thought to affect large employers in the same way, such as the employer’s share of National Insurance contributions that might be payable, as well as administration and recruitment costs.

The same reimbursement arrangements apply to Statutory Paternity Pay, Statutory Shared Parental Pay, Statutory Adoption Pay, Statutory Parental Bereavement Pay and Statutory Neonatal Care Pay.

The threshold for qualifying as a small employer was increased in April 2004 from £40,000 to £45,000 (or less) of gross Class 1 National Insurance contributions liability in the previous tax year.