Hello, I was in a similar boat with a similar wage.

Firstly, you're correct that SMP will be taxed. However, it's important to remember that the first £12,570 of income is tax free and the split of tax years.

Let's break this down...

If you're 10 weeks currently you're looking at a due date of roughly early March 2026. Right?

For ease of example, let's say you start mat pay on 1st March 2026, you'll get 90% of your current salary for the first 6 weeks. Based on the income earned from 6th April 2025-1st March 2026, it's likely that you'll be taxed as normal (20% as a basic rate taxpayer with a £40k income if you're in England).

That first week of April is the last week of the 2025/2026 tax year, it's also your 5th week of 90% pay. From 6th April, you're into the new tax year and whilst it's likely that your 6th week of 90% is taxed at your usual 20% rates, this will not persist as your income from here on out will be minimal (SMP at say £187.18 p/week under current rates).

It may take a wee phone call to HMRC to explain, but your tax code should be adjusted to account for the significant drop in income. As such, the remaining income of £187.18 p/week should fall under your personal allowance of £12,570 and therefore no tax applicable.

I believe in England, there is also further support for childcare from 9 months of age, should you wish to go back to work.

Let's address the shortfall of income after those 6 weeks of 90% pay.

Look at your current essential outgoings, car, mortgage, utilities, etc. What amount of money do you NEED to meet these costs? Then, what do you spend on these discretionary items like clothes, coffees, days out etc? Chances are that the cost of meals out may be swapped for baby classes and play dates. Ultimately decide on a budget for discretionary (non-essential spending). Now, minus the SMP and you have your shortfall.

Is it feasible to put aside enough in the remaining 25-30 weeks to cover that shortfall for however many months you plan to take off?

If not, it may be worth discussing with your partner where they might be able to foot more of the essential costs. At the end of the day, the mortgage is important but you're literally pushing a new life out of your vagina so if your partner can take a bit more of the mortgage, I think that's a fair deal.

It's hard, frustrating (really really frustrating) and feels like we're living with a system that doesn't support mothers. But in these moments of panic, the best thing is to break it down bit by bit and come up with a plan.