What is a P45?
A P45 is issued when someone stops working for an employer in the UK, and employers are legally required to provide it. It shows how much an employee’s earned and how much Income Tax has been deducted so far in the tax year, along with details such as their National Insurance number and tax code.
Employees will usually give their P45 to a new employer so they can set them up on payroll correctly. If an individual is out of work and claiming benefits, they may also need it for the Department for Work and Pensions (DWP).
It’s worth employees keeping their P45 safe in case they need it later.
Things to know
- A P45 is given when an employee leaves a job, not at the end of the tax year
- Employers are required to provide a P45 when employment ends
- It helps a new employer apply the right tax code and payroll details
- If an individual doesn’t have a P45, their new employer can use HMRC’s New Starter Checklist instead
- A P45 is different from a P60, which summarises the full tax year
FAQs
When should I receive a P45?
When their employment ends. Employers are legally required to provide it.
Do I need a P45 to start a new job?
It helps, but they can still start without one. Their new employer can use HMRC’s New Starter Checklist.
Can I use a P45 if I’m not moving straight into a new job?
Yes. If they’re claiming benefits, they may be asked for it by the Department for Work and Pensions (DWP).
What’s the difference between a P45 and a P60?
A P45 covers pay and tax up to an employee’s leaving date. A P60 summarises pay and deductions for the full tax year if they were employed on 5 April.
