What is HMRC form P45?
A P45 form is a statement or certificate that shows how much tax you’ve paid on your salary so far in the tax year.
It is normally given to you by your employer when you leave your place of work.
On the form P45 you will see the following figures:
- Total gross income during that particular employment.
- Total tax paid up to the date of leaving employment, or the date that a benefit claim ceased.
- Total gross income and tax paid from income previously received.
A P45 helps to keep your tax records up to date and the figures should be checked to ensure they are correct, as mistakes can be made.
A P45 form is made up of four parts:
- Part 1a is to be kept for your own records.
- Part 1 is passed on by your last employer to HMRC.
- Part 2 and 3 are given to your new employer (or benefits office) who will keep one and send the other to HMRC.
Why do I need a form P45?
A P45 is important because it tells your next employer information to make sure you don’t overpay or underpay tax. In many cases, you could be owed a tax rebate and it is often needed to help calculate how much you are owed.
Your P45 is given to you only when your income stops and is different to a P60 end of year certificate.
TIP – It’s important to remember that there are a number of different reasons why you could be owed a tax rebate. Check what you could be owed so you don’t miss out.
Should I keep my form P45?
Yes, it’s important to keep your own copy and make sure you give your new employer your last P45. If you don’t, your new employer will normally have to use an emergency tax code against your pay and ask you to fill in a P46 form.
A P45 is also vital if the tax office does not have all your income and tax details on record. Unfortunately, this situation can happen and it delays the repayment of any tax refund due.
The P45 allows HMRC to update your tax records quickly, meaning if you are due a tax refund you get it back in the quickest possible time.
