Implications of wife not returning to work after maternity leave

[Westy29]

Hi

My wife is currently on maternity leave after our first child. She has finished her paid maternity leave and is now taking the extra 16 weeks unpaid. She is due 3 weeks holidays and her public holiday entitlement which would mean her return to work would be the end of January 2016.

She doesnt intend to return to work and we are wondering if its better for her to cease employment in 2015 or 2016. There is a small chance the company may offer redundancy around or after Xmas. I have a couple of questions?

1. Should she receive her 3 weeks holiday pay and bank holiday pay in 2015, before the end of the year as the holidays were accrued in 2015 or does this wait until her unpaid maternity leave is up?

2. If she doesnt cease employment in 2015 and receives her holiday pay in 2016 does this effect my ability to receive her tax credit, home carer credit, and the higher income tax band for 2016. If she ceased employment in January 2016 would I simply receive the above pro rata'd. ie 11/12 times the benefit for instance?

If she bides her time and doesnt cease employment until early 2016 when maternity leave and accrued annual leave is up in the hope they offer redundancy. Will it make any real difference to us other than perhaps losing out on a months benefit of the tax credits, higher band etc??

Thanks

 

[thedaddyman]

One thing that perhaps she may not have considered is a career break, has she/can she apply for this?

Secondly, in term of getting any payments, if you can put it off to 2016, you will benefit from the reduced USC rates

 

[Mrs Vimes]

Not sure when the holiday pay should be, I think it would count as service, so she would return to work after unpaid leave, but take holidays then (ie January) and not physically go to work.

You can take the unused portion of her rateband and credits regardless of when she works - if she worked a day every week for 2016 you still could. Your entitlement to home carer's credit depends on her income in the year - if below the level you get it. It can be restricted due to her earnings but not granted pro rata.

Biding her time sounds like a good plan.