P45, P60 and P11D – welcome to the exciting world of PAYE forms. You may have vaguely heard these terms floating about your workplace and felt a slight twinge of curiosity. Or not.
The good news? We’re here to demystify the 3 Ps of PAYE for you. (Full disclosure: no one else calls them that).
What are they? Why do you need them? And how do you get them? Here’s what you need to know:
What is a P60 form?
In a nutshell? Your P60 is a summary of how much you’ve made over the tax year (between 6th April and 5th April) and how much tax you’ve paid in this period, including income tax and National Insurance contributions.
How is a P60 going to help me?
Why do you even need a P60 form, you ask? A P60 is actually packed with helpful info. Use it to:
- Get a grip on (and proof of) how much tax you’ve paid
- Apply for any tax credits
- Claim a tax refund (don’t you just love when that happens?)
- Provide proof of income for loans or mortgages
- Complete your tax returns (side note: for all you self-employed bosses out there, check out Curve Fronted and pay your taxes with a credit card)
How do I get my hands on a P60?
You don’t need to do anything. Your P60 will automatically be sent through by your employer. Expect an individual P60 form for every job. You’ll get it by the 31st of May, either on paper or digitally.
Can’t find your P60? Don’t panic. Ask your current workplace for one. They’re legally required to keep a copy of all P60s for three years.
We’d recommend always getting an electronic copy of your P60 – it’s a lot harder to lose.
What is a P45 form?
On to the next.
A P45 form isn’t too different from a P60. Except, it kinda is. Here’s how:
You’ll get a P45 form every time you leave a job. Think of it as a summary of your income and tax for the tax year to date. That last bit’s important as that’s how it’s different from a P60. A P60 covers the entire tax year while a P45 covers the tax year to date (at the point you leave a job).
What do I need a P45 form for?
Let’s take a closer look at why P45 forms are actually pretty great.
A P45 ultimately ensures that you pay the correct amount of tax when you start a new job. You can also use it as proof of income to get benefits such as Jobseeker’s Allowance or any tax refunds.
What does a P45 form include?
Your P45 form consists of four different parts:
- Part 1 will go straight from your employer to HM Revenue and Customs (HMRC), and it includes details about salary and tax. This bit’s important as it makes sure you don’t accidentally end up paying more (or less) tax than you should.
- Part 1A is yours to keep. Stash it somewhere secure so you can refer to it when you need to.
- Parts 2 and 3 are there for you to give your new boss. They’ll use these to figure out the amount of tax you should be paying. If you’re between jobs, take these parts to your local Jobcentre Place to claim Jobseeker’s Allowance.
Where can I find my P45?
Ask your employer. They’re legally required to give you a P45 form when you stop working with them. If they claim that they don’t have one to give you, reach out to HMRC.
What if I don’t have a P45?
Just about to kick off your work life? If it’s your very first job, no one expects you to have a P45. Your employer will ask you a few simple questions to work out exactly how much you should pay on your tax bill. They’ll use factors such as your student loan as well as any other jobs and benefits you’re getting to figure out your tax.
Finally, what is a P11D form?
Your last stop in our whirlwind tour of PAYE forms – the P11D.
So, a P11D is somewhat similar to a P45 and P60, but not quite. Like the other two, it gives you an understanding of your income and tax. But here’s how it’s different:
The P11D is all about benefits. Your employer will use it to tell HMRC about any ‘benefits in kind’ you’re getting on top of your salary. So that means anything that’s not on your payslip. For instance:
- Health insurance
- Interest-free loans
- Company car (if you’re lucky enough to get one)
Now, your employer doesn’t have to complete this form – but they should tell you how much your benefits are worth.
Your employer may also take the tax you’re owed on your benefits directly out of your pay – in which case, no P11D for you.
Confused? Ask your employer for more info.
Where can I get my P11D?
If your employer is going to give you a P11D, expect it by 6th July.
Haven’t got a P11D yet? Reach out to your employer to find out where it is. Not all employers will offer P11D forms, but they’re required to tell you what your benefits amount to in some form.
Now that that’s all worked out, did we mention that you can now pay your taxes with a personal credit card? Yep, you read that right. Find out more about how you can simplify your finances with Curve.