Statutory Maternity Pay: Common Mistakes, Tips and FAQs

Introduction

Business and employment calculations are full of terms that sound alike but mean different things, such as margin and markup.

This article covers the most common mistakes people make with statutory Maternity Pay, what really moves the result, and answers to the questions we hear most often.

Why it matters

Clear numbers help you price profitably, chase late invoices with confidence and understand statutory pay entitlements.

How it's calculated

SMP is 90% of your average weekly earnings for the first 6 weeks, then the lower of the standard weekly rate or 90% of earnings for the next 33 weeks.

What changes the result most

We raised each input by 10% on its own, starting from a typical example where total SMP is £9,416.94. Here's what happened:

• Raising sMP standard weekly rate from £187.18 to £205.90 changes total SMP to £10,034.63 (+6.6%).
• Raising average weekly earnings from £600 to £660 changes total SMP to £9,740.94 (+3.4%).

Focus first on sMP standard weekly rate, which has the biggest effect in this example.

Common mistakes to avoid

1. Confusing margin and markup when setting prices.
2. Leaving VAT inside revenue figures when calculating profit.
3. Not claiming late payment compensation you're entitled to.
4. Using out-of-date statutory pay or minimum wage rates.

A quick example

With the inputs below, total SMP comes out at £9,416.94.

Tips

• Price from margin, not markup, if you want to hit a target profit percentage.
• Quote prices to businesses ex VAT and to consumers inc VAT.
• You can legally claim statutory interest on late B2B invoices.
• Statutory pay rates usually change every April – check GOV.UK.

Frequently asked questions

What's the quickest way to work out statutory Maternity Pay?

Use our free statutory Maternity Pay Calculator. It applies this method automatically: SMP is 90% of your average weekly earnings for the first 6 weeks, then the lower of the standard weekly rate or 90% of earnings for the next 33 weeks.

Are statutory pay figures up to date?

Rates are editable on each calculator. Defaults reflect recent published rates; always confirm current figures on GOV.UK.

Do these work for sole traders?

Yes. Margin, markup and break-even apply to any business size.

Is this legal advice?

No. For disputes about pay, redundancy or debts, contact Acas, Citizens Advice or a solicitor.

Related calculators

• Profit Margin Calculator
• Markup Calculator
• Break-Even Calculator
• ROI Calculator
• Discount Calculator
• Late Payment Interest Calculator

For the full method, read How to Calculate Statutory Maternity Pay in the UK: Step-by-Step Guide.