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SMP and benefits in kind

Lady is employee of company A.  Currently on maternity leave and getting SMP.

She is also director of (unrelated) company B.

I am aware that she cannot draw a salary from company B, as this will affect her SMP.  But does a BIK from company B have the same impact?

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01st Jun 2012 13:27

when did she start employment/directorship with company B

Whilst this doesn't answer the question exactly, if she was "employed" by company B on the relevant date (i.e. 15 weeks before expected due date), then even if she was unable to get SMP from company B due to no earnings (or less than LEL), she is still able to take a wage and  a fortiori BIKs from company B without it affecting SMP from company A.

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07th Jun 2012 10:59

Dates

aiwalters wrote:

Whilst this doesn't answer the question exactly, if she was "employed" by company B on the relevant date (i.e. 15 weeks before expected due date), then even if she was unable to get SMP from company B due to no earnings (or less than LEL), she is still able to take a wage and  a fortiori BIKs from company B without it affecting SMP from company A.

She became a director of company B on 30 July 2010.  EDD was beginning of September 2011 so in that respect she was "employed" at the relevant date - she was also working for company A at time of appointment.

SMP finished 15.5.12 - so does that mean BIKs from company B in 2011/12 should not affect the SMP received?

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Why does being paid by company B affect SMP from company A?

Each employment is treated separately if the employers aren't connected. I'm unaware of any requirement for the employee to stop working for company B if they're getting SMP from company A. The employee might also be entitled to SMP payment from both employers if they meet the qualifying conditions in both employments.

I've never come across the requirement previously and a quick trawl through the HMRC pages on the internet hasn't revealed a requirement for the employee to stop work with company B in order to be entitled to SMP from company A. But I could be wrong (not for the first time) and I'd be interested to see the guidance on that particular point.

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07th Jun 2012 12:10

Tom

I think it's only of relevance if the individual wasn't in the second employment at the relevant date. i.e. if she "left" (her only) job 1 (which in isolation doesn't mean that SMP stops), but then took up a "new" employment with job 2 (which I understand would mean that SMP from job 1 would then have to potentially cease) - so admittedly perhaps a little weak on clarification on my part in the OP.

I do agree though that SMP is possible from both employments providing the conditions are met - but as a non-paid director of company B, she wouldn't have got anything (and BIKs of course do not count as "earnings" for this purpose). 

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