New tax year changes ends Statutory Sick Pay rebate

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Smaller employers are expected to be affected by changes to the statutory sickness pay rebate scheme announced during the Budget. 

As of 6 April, the government abolished the Statutory Sick Pay (SSP) rebate scheme which enabled employers to claim SSP paid out to sick employees by way of a reduction in their PAYE payments.

The scheme was administered on a percentage basis with larger employers often unable to claim any rebate, while smaller employers could frequently claim back 100%.

It is therefore likely that the abolition of the rebate will hit smaller employers disproportionately as they will now have to cover the cost of paying SSP to workers who are off sick.

For one or two people businesses, this cost, added to losing an employee, could add up to a significant change in circumstances.

The government plans to put any money saved towards the Health and Work service to encourage more people to get back to work.

It is important to note that whilst the scheme ceased to operate at the start of the 2014/2015 tax year, employees can still claim the SSP rebate for employees who were absent during 2013/2014 until the end of the 2015/2016 tax year.