How to deal with maternity pay, salary sacrifice and childcare vouchers




  • Appreciate that salary sacrifice is a contractual arrangement between employer and employee.
  • Remember that a salary sacrifice arrangement must be effective in achieving its intended purpose.
  • Remember that HM Revenue and Customs will not provide advice on setting up, drafting, operating or varying salary sacrifice arrangements.
  • Be aware of the impact that a salary sacrifice arrangement may have on statutory maternity pay.
  • Be aware of the relationship between statutory maternity pay, salary sacrifice and childcare vouchers.
  • Take into account that a “lifestyle change” such as expecting a baby may justify changing a salary sacrifice arrangement before the intended period has elapsed.
  • Remember that a salary sacrifice arrangement may reduce an employee’s entitlement to contractual maternity pay.
  • Ensure that any non-cash benefits, such as childcare vouchers, provided as a term of the contract continue during additional maternity leave where the expected week of childbirth is on or after 5 October 2008.

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