Statutory Sick Pay (SSP) PDF Print E-mail

When your employee is off sick for longer than three days you have the responsibility as their employer to administer Statutory Sick Pay (SSP) on their behalf. The first three consecutive days (excluding days not normally worked) of illness are known as 'waiting days' and any payment during this period is at your discretion. From the fourth consecutive day SSP can be paid instead of, or as a part of the normal rate of pay. Please refer to our Rates and Thresholds page for details of the current SSP rate.

Changes to the law from 6 April 2014

From the start of the tax year 2014/15, The Percentage Threshold Scheme (PTS) which allowed, in certain circumstances, employers to recover SSP has been abolished. Employers will no longer be to reclaim SSP although recovery of unclaimed SSP for previous tax years may be possible for a limited period. In replacement of the PTS, the government have announced they will be moving the funding into a new scheme as part of the cross-government Health, Work and Wellbeing Initiative. Under this new scheme, which is expected to launch in 2015, help will be made available to employees who have been incapacitated for four weeks or more, to get them back to work.

Introducing an incentive

Incentives are not a legal requirement but because many employers are dependent on their employees coming to work an increasing number now offer an incentive instead. An incentive can be a Friday afternoon off, a voucher or a meal at a local restaurant. If you decide to offer an incentive make sure you include the terms in the employment contract.

View current rates and thresholds.
 

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Basic document checks

According to the Asylum and Immigration Act 2006 all UK employers have a legal duty to make basic document checks on each person they intend to employ in order to establish that they have a right to work in the UK and are here legally.

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Benefits in kind

Benefits in kind are sometimes provided by the employer in addition to the employee's salary. They are often taxable benefits and must be reported annually as part of employee's gross earnings.

Who pays the tax?
Benefits in kind offer a good example of why it is important to agree a gross wage with your employee. In almost all other types of employment the employee is always responsible for paying the tax on benefits. But as many domestic staff have net pay arrangements it means that you, the employer, are responsible for paying this tax, which can potentially be a very expensive experience.

Tax on benefits in kind is payable in arrears and is not reported until July following the end of the tax year. Sometimes it can take up to two years before payments are claimed by HMRC, and during the interim your employee can have moved from one job to another, leaving the new employer responsible for paying what can in some cases be a very large sum of money. If your employee is on a gross wage, however, then the tax is deduced from their gross income at their current rate of tax.

In addition to tax there may also be a Class 1A NI charge of 12.8% of the value of the benefit to be paid - the employer always pays this charge.

Examples of taxable benefits

  • Car
  • Accommodation
  • Health Club Membership
  • Travel
  • Interest Free Loan

NB: PLEASE NOTE THAT THIS LIST IS NOT EXHAUSTIVE.

Mobile phones are not considered a taxable benefit

Use of Car
The use of a car is not considered a taxable benefit if your employee only uses it during working hours. If however your employee is permitted to take the car home and use it as a means to get to and from work, then it must be reported as a benefit in kind.

Accommodation
If accommodation is provided for the employee and it has a separate front door and separate metering for gas, water and electricity, it is considered a taxable benefit and must be reported as such.

Please note that the information and examples contained on this page are to be used as guidelines only. If you have specific questions please contact Stafftax.