Tax credits and benefits for parents
In this articleChildren can cost a small fortune, but there is financial help available for parents.
Here's a guide to tax credits and benefits for families.Statutory maternity pay
Statutory maternity pay (SMP) lasts for 39 weeks. SMP pays a standard weekly rate of £139.58 or 90 per cent of your average gross weekly earnings before tax, whichever is less.Not everyone is eligible for SMP. You must have worked for your employer for at least 26 weeks by the end of the 15th week before your due date. You can work this out by finding the Sunday of the week your baby is due and counting back 15 weeks. If you aren't eligible for SMP, find out from your local Jobcentre Plus office if you are eligible for maternity allowance.
Maternity allowanceYou can claim this if you've changed jobs during pregnancy, are self-employed, or have been unemployed during pregnancy. Maternity allowance can be paid from 11 weeks before your baby is due for up to 39 weeks. You'll be paid £139.58 or 90 per cent of your average weekly earnings, whichever rate is lower.
Maternity leaveOrdinary maternity leave lasts for 26 weeks. Additional maternity leave will last for 26 weeks from the end of ordinary maternity leave, so your maximum leave entitlement could be 52 weeks. You do not have to take all of your maternity leave. However, you must take two weeks' compulsory maternity leave after your baby is born. If you work in a factory, this will be four weeks.
Ordinary paternity pay and leave
You can have up to two weeks of paternity leave after your baby's birth, during which you can have ordinary statutory paternity pay (OSPP). To quality for this, one of the following should apply to you:
- you have worked for your employer for at least 26 weeks by the end of the 15th week before the week the baby is due
- you are the baby's biological father or the mum's husband or partner
- you have, or expect to have, responsibility for the baby's care
- you are an employee with a contract of employment
Parents who are adopting a child will be eligible for paid adoption leave for the same period and at the same flat rate as statutory maternity pay. Only one person in a couple can take adoption leave, but your partner may take paternity leave.There are some circumstances in which you won't qualify for adoption leave or pay. For example, if you're arranging a private adoption, or adopting a family member or stepchild.
Unpaid parental leave
Unpaid parental leave allows mums and dads to take time off work to improve their child's welfare. This may include settling a child into childcare, looking at new schools or attending a family event.Working parents with responsibility for raising their children can take this if they've been with their employer for at least one year. Each parent can take a total of up to 18 weeks' unpaid parental leave for each of their children. This can be taken any time up to your child's 18th birthday, although you can't take more than four weeks in any one year.
Shared parental leaveShared parental leave allows mums to share their 52 weeks of maternity leave with their partner. It's designed to give parents more choice and flexibility in sharing the care of their new baby. You and your partner can choose to take shared parental leave at the same time, to be together at home with your baby. Or you can alternate who goes back to work and who stays at home. If you're
eligible for maternity pay or paternity pay, you probably qualify for statutory shared parental pay. Each parent can receive this payment. It can be paid for up to 39 weeks per couple, minus any weeks of maternity pay that has already been taken. The government has undertaken a major overhaul of the welfare system. Universal credit is absorbing some benefits and tax credits, which are being rolled up into a single monthly payment. Six benefits will be absorbed into universal credit. They are:
- child tax credits
- working tax credits
- housing benefit
- jobseeker's allowance
- employment and support allowance
- income support
If you don't live in an area where universal credit is being piloted, you can still apply for tax credits and some benefits separately.If you have a low income, you may qualify for working tax credit, which could help with childcare costs. This is up to a maximum of £122.50 per week if you have one child, and £210 per week if you have two or more children using registered childcare. However, the actual amount will depend on your income. Child tax credit is to help with the cost of bringing up your children. The amount you will receive depends on your income, or joint income if you are part of a couple. If you have a child with a disability you may be entitled to more. Child tax credit and the childcare element of working tax credit are paid directly to the main carer.
GOV.UK has further information, or you can call the tax credit helpline on 0345 300 3900.
Child benefitThis is a universal benefit of £20.70 per week for your first child, and £13.70 for subsequent children. It is paid to the main carer of a child. To claim, call the child benefit helpline on: 0845 302 1444.
If you or your partner has an individual income of £50,000 or more after tax, you will be liable to the high-income child benefit tax charge. This means that some or all of your child benefit is clawed back. If you and your partner both earn more than £50,000, whichever salary is highest will count. If your income is £60,000 or more, all your child benefit will be taken back.You can claim other benefits, depending on your circumstances and income.
Free prescriptions and free dental treatmentAll women who are either pregnant or have a baby under one year are entitled to free prescriptions and dental treatment. Children, too, are entitled to these benefits.
Sure Start maternity grant
If you're on a low income and receive certain benefits, you can claim a Sure Start maternity grant. This is a one-off lump sum of £500 to help you buy clothes and equipment for your first child only. You don't have to pay it back. Find out whether you qualify for the Sure Start maternity grant.
You may also be able to claim for free milk, free vitamins and cheaper formula milk through the NHS Healthy Start programme. It's available to women who are pregnant and to families with a child under four years old and who receive certain benefits. If you're pregnant and under 18, you'll qualify whether or not you receive benefits.The government sets the minimum that you should get. However, a growing number of employers recognise the value of offering good maternity policies, which are better than the statutory minimum. They see it as a way of retaining their valuable staff and offering them support.
Check your employment contract or talk to your human resources (HR) department to find out if you are entitled to any additional benefits.You can talk to your employer or HR department to find out if you are eligible for maternity or paternity pay. GOV.UK has more information on your entitlements. You can also contact your local Citizens Advice Bureau office, where advisers will help you with any queries about what you're entitled to.
Last reviewed: March 2014