What is a P45?
When you leave a job, your former employer should issue you with a P45 form. This details your salary and the taxes you've paid to date in the tax year.
When you leave an employer, it is their responsibility to issue a P45 form.
The form has four parts - Part 1, Part 1A, Part 2 and Part 3. Part 1 is sent to HMRC, Part 1A is for you to keep for your records, and Part 2 and 3 are for you to give to your new employer - or Jobcentre Plus if you're not working.
In each section, the P45 provides a record of how much you've earned and what taxes you've paid.
Why is a P45 important?
You'll need your P45 when changing jobs, as your new employer will use it to make sure you are put on the correct tax code.
Without it, you may end up being put on an emergency tax code or paying too much tax.
You may need to use the information in a P45 to fill out a tax return, if you are sent one.
If you're not working, you'll need your P45 to claim tax refunds and social welfare benefits.
Your P45 is also important for making sure you are not charged too much tax when withdrawing money from your pension.
What does a P45 look like?
The image below shows Part 1A of a P45. This is the part given to you, that you should keep for your records.
Who issues a P45?
Your employer issues and generates a P45 automatically through their payroll system.
By law, your employer must give you a P45 when you finish working - you can ask for one if they do not provide it.
Do you get a P45 when you retire?
Your employer will issue a P45 when you leave your job to retire.
You should give the information to your pension provider to make sure you are put on the correct tax code when making withdrawals from your pension.
Do you get a P45 if you've been sacked?
No matter how your employment ends, you should be given a P45 - whether you quit, were laid off or were terminated.
If you don't have another job to move onto, you need to take your P45 to Jobcentre Plus in order to register for benefits.
How long is a P45 valid for?
Your P45 is valid for the tax year in which it was issued.
Like all paperwork related to your income tax, you should store your P45 for at least 22 months from the end of the tax year it was issued.
However, HMRC can carry out retrospective income tax investigations for up to 20 years, so it might be worth keeping records for longer.
If you haven't been in employment for more than a year, your old P45 form will no longer be valid for a new employer and you may need to fill out a 'Starter Checklist' when you start a new job.
What if my P45 is wrong?
When you receive your P45, check that the details are correct.
If there's an issue with your personal information, ask your company's HR to update it. If you think your tax code is wrong, you should contact HMRC.
When you're starting a new job, you may be able to fill out a 'Starter Checklist' instead.
What if I've lost my P45?
If you've lost your P45, you can't get a replacement.
When you start a new job without a P45, your new employer may ask you to fill out a 'Starter Checklist', detailing your personal financial information.
The details on this can be used to calculate your tax code - although you may be put on an emergency tax code if HMRC does not have enough information on your income and tax owing.
What about a P46?
A P46 form used to be issued if you had never worked before, or if you didn't have a P45. This form is no longer used, and has instead been replaced with a Starter Checklist form.
The Starter Checklist includes questions about any other jobs, benefits or student loans you have, and helps your employer find the right tax code before your first payslip is issued.
Without this information, you might be put on an emergency tax code.