If you are self-employed
Maternity or paternity leave
The rules for employees do not apply to you. It’s up to you to choose when and how long you take off. Your decision is likely to depend on the demands of your business and how long you can afford to be away.
If you run your own business as a company (rather than being self-employed or in a partnership), you are classed as an employee, so the normal rules for employees described in this guide apply to you.
Maternity pay
You cannot get Statutory Maternity Pay but you may qualify for Maternity Allowance instead provided you have worked for at least 26 of the 66 weeks before the week your baby is due, and have paid Class 2 National Insurance (or been exempt) for at least 13 of those 26 weeks. You can claim the small earnings exemption if your earnings are less than £5,075*.
Maternity Allowance is paid at a standard rate of £124.88* a week if you meet the Class 2 National Insurance contribution condition above. If you have claimed the small earnings exemption, your Maternity Allowance will be £27* a week.
Maternity Allowance can start from the 11th week before your baby is due and can last for a maximum of 39 weeks. The latest date on which it can start is the day after your baby is born.
Maternity Allowance must be claimed – it is not paid automatically. The earliest you can claim is the 14th week before your baby is due. Contact your local Jobcentre Plus or Jobs and Benefits Office (see Useful contacts). You’ll need to fill in a claim form and give the office the MATB1 form that you were given by your doctor or midwife. Maternity Allowance can only be backdated three months. If you claim late, you may lose money.
You don’t have to have started your leave to make your claim, but the allowance cannot start until you stop work and it ceases when you go back. However, you can work up to ten Keeping In Touch (KIT) days while getting Maternity Allowance without losing any allowance.
Maternity Allowance will be paid direct to your bank, building society or Post Office® card account.
Maternity Allowance is tax free and, while you are getting it, you are exempt from paying Class 2 National Insurance contributions. Claiming the allowance may affect other benefits you get, such as Carer’s Allowance and Income Support. Maternity Allowance does not affect tax credits or Disability Living Allowance. For more information, contact your local Jobcentre Plus or Jobs and Benefits Office (see Useful contacts).
Paternity pay
There is no Statutory Paternity Pay or allowance for self-employed fathers.
Childcare costs
You may be able to claim Working Tax Credit to cover a large part of your childcare costs – see Tax credits.
Flexible working
As a self-employed person, it is up to you to choose the hours you work. Depending on the nature of your business, this means you may be able to flex your hours to fit the demands of your family.
*Rates shown are for the tax year 6 April 2010 to 5 April 2011.