The short answer: SMP yes, Maternity Allowance no
Statutory maternity pay (SMP) is treated as earnings. Your employer deducts income tax and National Insurance from it through PAYE, week by week, exactly as it would from wages. Maternity Allowance (MA), which the government pays directly to mothers who do not qualify for SMP, is a benefit and is not taxable — you keep the full £194.32 a week (2026/27) or 90% of your earnings if that is lower.
How SMP tax works in practice
Take the worked example from our maternity pay calculator: on £600 a week, SMP is £540 a week for 6 weeks and £194.32 for 33 weeks — £9,652.56 over 39 weeks. If that is your only income in the tax year, it sits below the £12,570 personal allowance, so no income tax is due — but National Insurance is still deducted on earnings above £12,570 a year only, so nothing either. In practice most mothers also have salary before leave starts, so the year's total income decides the tax, not the SMP figure alone.
The tax-year trap
SMP weeks are paid at the rate in force for the tax year each week falls in, and the flat rate is reviewed every April. A 39-week period starting in February straddles the April boundary: early weeks use the old flat rate, later weeks the new one. Your tax code also resets on 6 April, so the tax deducted can change mid-leave even though your SMP has not. Keep both years' payslips — a refund claim needs them.
Getting overpaid tax back
PAYE assumes you earn evenly all year. If unpaid leave (weeks 40–52) cuts your annual total, the tax taken in the early months may exceed what the year actually owes. HMRC usually fixes this automatically with a revised tax code or a P800; if a year has passed with no correction, claim through self-assessment or by contacting HMRC. The same logic applies to student loan repayments, which are also calculated on annual earnings.
Browse all our tools from the homepage, or see the full list of guides for more step-by-step explainers.