Understanding the difference between a P60 and P45 helps you manage your tax affairs effectively.
A P60 summarises your annual tax position, while a P45 tracks your tax status when changing jobs during the tax year.
Despite their differences, both documents play vital roles in the management of your tax affairs and are issued by your employer rather than HMRC (the tax office).
The P60 serves as your definitive proof of annual income and tax payments, which becomes essential when:
- Claiming a refund of income tax from HMRC.
- Providing proof of national insurance payments.
- Applying for finance like a personal loan or mortgage.
- Filing self-assessment tax returns.
- As a form of identification for various applications.
The P45, though more limited in scope, remains equally important as it:
- Ensures your new employer applies the correct tax code.
- Can reduce the risk of an incorrect emergency tax code being used.
- Helps maintain continuous and accurate tax records when changing jobs.
- Can be needed when claiming certain benefits.
Both forms represent legal obligations for employers and apply to both part-time and full-time workers. Your employer must issue a P45 when you leave – you should request one if it’s not provided automatically.
Similarly, employers must provide P60s to all eligible employees by the employers end of May deadline.
Ultimately, while these documents serve different purposes, both are critical components of the PAYE system that help maintain accurate tax records throughout your working life.
When are a P60 and P45 issued?
The timing of when these documents are issued by your employer(s) marks their first fundamental difference.
P60 issue date:
A P60 is an annual document you receive if you’re still employed by a company at the tax year-end (5 April).
Your employer must provide this certificate by 31st May following the end of the tax year.
A P45 is only issued when you leave employment. Your employer provides this document at the end of your employment, regardless of why you’re leaving – whether you’ve resigned, been dismissed, or retired.
This makes the P45 an “exit document” while the P60 is an “annual summary” document.
If you work multiple jobs simultaneously and remain employed at all of them on 5 April, you should receive multiple P60 – one from each employer.
P45 issue date:
This differs from the P45, which you only receive when ending employment with a specific company.
Your employer may deliver your P60 or P45 either in physical form (P60 typically printed on orange-coloured A4 paper) or electronically as a PDF file.
It’s important to know your rights regarding P60 and P45 documents if you are having a problem getting one.
Under UK tax regulations, employers have specific legal responsibilities meaning employers must provide P60 certificates to all qualifying employees by 31st May following the tax year end, and your P45 at the point of leaving your job.
What information your P60 and P45 includes
Although both documents contain similar tax information, they cover different time periods and include specific pay and tax deduction details.
A key distinction lies in the coverage period – the P45 only shows tax information up to your leaving date within the current tax year, whereas the P60 encompasses your complete tax history for the entire tax year.
The P45 shows:
- Your total earnings in the current tax year up to your departure date.
- Income tax deducted until your leaving date.
- Your personal tax code used by that employer.
- Your national insurance contributions.
In comparison the P60 provides a more comprehensive picture:
- Total pay for the entire tax year (6 April to 5 April) before and after deductions.
- All income tax deducted throughout the year.
- National insurance contributions for the whole tax year.
- Your tax code at the tax year end.
- Student loan repayment deductions.
- Details of any statutory payments, such as maternity or paternity pay.
If you’ve changed jobs during the tax year, your final P60 will incorporate information from your P45, showing combined earnings and tax paid across all of your employments during that tax year.
What to check for accuracy
Immediately upon receiving your P60 or P45 you should verify that the following info is correct:
- Personal details: name, address, national insurance number (NINO).
- Employer information including their PAYE tax reference number.
- Accuracy of your tax code. If it’s wrong you will likely pay the wrong amount of income tax (either too much or too little) moving forward.
- Tax year dates.
- Income figures match your final payslip’s year-to-date totals.
- All deductions align with your expectations.
Quickly reporting any discrepancies to your employer is essential and remember to keep records of these communications for example an email or WhatsApp message.
Overall, taking these preventative steps will save considerable hassle, as correcting errors early prevents potential tax complications in the future.
How to get a copy P60 or P45
Employers are legally required to keep payroll records for at least three years after the end of the tax year.
Copy P60:
Your employer should be able to produce a replacement P60 for the previous three year period at a minimum.
If your employer claims they cannot provide a replacement, remind them of their legal obligation.
These initial steps can often resolve your missing P60 situation quickly and with minimal hassle.
Should your employer continue to refuse, you have other options available through HMRC by viewing your P60 details through your personal tax account on HMRC’s website or via the HMRC app.
You can also phone HMRC directly to request the information in the form of a statement of earnings which is posted to you in the form of a letter.
Copy P45:
Getting a copy P45 isn’t possible but you can ask your employer for a ‘statement of earnings’ on a company letterhead. HMRC let’s you see the same figures stated on your P45 via their app or your personal tax account.
If you start a new job and can’t provide your new employer with your P45 they will usually give you a starter checklist to complete, which should update your records in a similar way to a P45.
