Will childcare vouchers affect my statutory maternity or paternity pay? What are my options whilst on Maternity Leave?

You have 3 options in relation to your childcare vouchers whilst on maternity leave:

Option 1 - You can withdraw from the childcare voucher scheme. If you do so prior to the period in which SMP is calculated (the 'qualifying period'), your SMP calculations will be based on your higher salary (not including your salary sacrifice deductions). This period begins at approximately week 17 of your pregnancy.

Option 2- You can opt out of the childcare voucher scheme during the qualifying period, so your SMP calculations are based on your higher salary, and then re-join the scheme afterwards. The qualifying period lasts for 8 weeks and is approximately between weeks 17 and 25 of pregnancy. If you will be receiving contractual or occupational maternity pay, you may continue to salary sacrifice until your pay reverts to SMP/SAP. Please note that childcare vouchers cannot be deducted from SMP/SAP so, at this point, you may be required to take a break from receiving childcare vouchers until you return to work. (As long as you resume your childcare voucher claim within 12 months, it will not be considered a new claim).

Option 3 - You can remain in the childcare voucher scheme during the qualifying period, and your maternity leave until you are no longer receiving contractual or occupational maternity pay. Your SMP will then be calculated at the lower rate (after your salary sacrifice deductions).

Statutory Paternity Pay is not affected. 

Before making your decision, you should seek advice from any relevant agencies in relation to Tax Credit Implications or ongoing childcare costs.

Please consult your HR department for further guidance.