March 2025 Version 1.9.7
Statutory Parental Bereavement Pay
Overview
Following the introduction of the Neonatal Care (Leave and Pay) Act 2023, employees with a parental or other personal relationship with a baby who is receiving neonatal care can take up to 12 weeks of paid leave which, subject to meeting the relevant criteria, will be paid at the statutory rate. This new act comes into effect from 6th April 2025 (tax year 2025/2026).
This includes a minimum entitlement of one week, in addition to other leave entitlements such as maternity, paternity, adoption and shared parental leave. SNCP applies to employees in England, Scotland and Wales, but not currently Northern Ireland.
Key factors of Statutory Neonatal Care include:
- 26 weeks continuous service required
- Rate is the same as other statutory parental pay, for 2025/2026 this is £187.18 or 90% of average weekly earnings, whichever is lower
- The employee must take leave within the first 68 weeks of their baby’s birth to qualify for SNCP
- Can be taken in two tiers:
Tier One
- Applies to employees who take their leave while their child is in neonatal care or within the 1st week following their discharge. This tier can be taken flexibly in weekly periods that do not need to be consecutive
Tier Two
- Applies after the Tier One period ends and until the end of the 68-week period following the child’s birth date. Any Tier Two leave must be taken in one continuous block
Software Changes
To accommodate SNCP in the software, we have made the following changes:
On the Employees | Calendar & Leave | Statutory tab:
- Choosing Add New Absence gives the option for Statutory Neonatal Care Pay
On the Company | Setup Details | Opening Balances screen:
- New SNCP fields for companies entered into KashFlow Payroll from 2025/2026 Tax Year onwards.
On the Payslip screen:
- We have added a new automatic payslip item for SNCP Payments.
- We have added a new manual payslip item to cater for any adjustments, to be displayed in the Payments and Deductions sections, Adjustment | Statutory | Statutory Neonatal Care Pay
- Applying an SNCP adjustment will adjust the YTD value that is stored against the Employee
On FPS submission:
- SNCP is included in employee entries when relevant
On EPS submission:
- SNCP recovery and compensation are included
On the Company| Payments and Receipts tab:
- Fields showing SNCP recovery and compensation are included in each month’s pdf
All reports, where applicable, have been updated with SNCP information.
The SNCP changes will only appear starting from the 2025/2026 Tax Year.
National Insurance
On 30th October 2024, the Government announced changes affecting National Insurance contributions Secondary Threshold and Secondary Class 1 rate, to apply from 6th April 2025. From this date, the Secondary Threshold decreases from £9,100 to £5,000, and the main rate of Secondary (Employers) Class 1 NICs increases from 13.8% to 15%. We have updated the software with the new threshold and rate.
NICs compensation rate on Statutory Payments
Employers can currently reclaim 92% of employees’ Statutory Maternity, Paternity, Adoption, Parental Bereavement and Shared Parental Pay or, if a business has paid £45,000 or less in Class 1 National Insurance (ignoring any reductions like Employment Allowance) in the last complete tax year they can qualify for Small Employers Relief, and claim 100% of the Statutory Payment plus an additional 3% compensation.
From 6th April 2025, the rate of compensation increases from 3% to 8.5%. We have updated the software with the new rate.
Workplace Postcode
From 6th April 2025, HMRC intends to reject an FPS is a Freeport or Investment Zone NIC category letter is reported for an employment but does not contain the workplace postcode for any qualifying employee.
In Employee | Details | Government, we have added a new Workplace Postcode field. This new field must be populated for any qualifying employee located within a designated special tax site, and when the employee’s National Insurance Category letter is F, I, L, S, N, E, D or K.
National Insurance for Married Women
Following a new rule introduced by HMRC, where the FPS will be rejected when a reduced rate National Insurance Category letter (B, E or I) is supplied but does not qualify based on the date of birth supplied, a date validation warning message now appears in Employee | Details | Government or during the Finalise process. This occurs if a female employee’s National Insurance Category letter is set to B, E or I, and their Date of Birth is after 05/04/1961.
Employment Allowance
The Government announced that from 6th April 2025, Employment Allowance would increase from £5,000 to £10,500. In addition, the restriction that previously applied, where employers who have incurred a secondary Class 1 NICs liability of more than £100,000 in the previous year are unable to claim Employment Allowance, has been removed.
Software Changes
- Increased the maximum Employment Allowance value to £10,500 in relevant screens and reports
- Changed text in Company | Employment Allowance screen to remove any mention of the restriction of the allowance on companies with a secondary Class 1 national insurance exceeding £100,000
- Changed text in Company | Employment Allowance screen to replace ‘De minimis State aid’ with ‘State aid’
Earnings Arrestment Scotland
Scottish Earnings Arrestment Deduction tables have been updated from April 2025. We have updated the following Earnings Orders to include the new tables:
- Scottish EA
- Scottish CAO (EA Part)
- Scottish CAO (EAs Only)
PAYE Legislation
Student/Postgraduate Loan
Student and postgraduate loan thresholds for the 2025/2025 tax year. We have updated the system with these figures.
Tax Code Changes
Personal allowance tax code rates for the 2025/2025 tax year. We have updated the system with these rates.
Tax, NI and Statutory Payment Rates
Tax, NI, and statutory payment rates for the 2025/2025 tax year. We have updated the system with these rates.
National Minimum / National Living Wage
National Minimum Wage and National Living Wage rates for the 2025/2025 tax year. We have updated the system with these rates.
Automatic Enrolment and Pensions
Automatic enrolment and pensions figures for the 2025/2025 tax year. We have updated the system with these rates.
RTI
FPS – 2025/2026
In line with government legislation, we have updated the FPS schema for the 2025/2025 tax year.
EPS – 2025/2025
We have amended the EPS schema for submissions relating to the 2025/2025 tax year.
Earlier Year FPS Changes for 2024/2025
We have updated the EYFPS schema for the 2024/2025 tax year.
Other Improvements
P60 Changes for 2024/2025
A new P60 layout for year-end 2024/2025 is now available.
GPP Pension Changes
View changes for NHS Pension Scheme changes here:
