4th April 2021
By the 31st of May, an employer is required to give their employees a PAYE (or ‘Pay As Your Earn’) form called a P60 (End of Year Certificate). This certificate, required by the HMRC (HM Revenue & Customs), is a summary of their year-to-date pay in a given tax year. This will also contain useful information about tax and National Insurance Contributions (NICs) that have been deducted through the PAYE scheme.
For employee use, a P60 is a record of pay within a tax year, which must be correct and accurate. An employer is obligated to submit this form to their employers on time (or the last day of the tax year) as part of their annual payroll reporting. This applies to those on your payroll.
The other PAYE forms in this sequence are the P45 and the P11D. Like the P11D, which is mandatory where a BIK benefit has been provided, the P60 is an annual form that must be submitted every year.
A P60 is evidence of tax that has been paid within a tax year and is useful in a variety of situations, including:
- to claim back overpaid tax
- to apply for tax credit or as proof of your income if you apply for a loan or a mortgage
What is a P60?
A P60 is a tax form that contains details of the pay and tax deductions from the previous year. In must be filed electronically unless you are exempt.
The form will contain the following:
- The employee’s details
- their National Insurance (NI) number
- payroll number
- their pay and income tax details:
- in any previous employment they had with you,
- in this current period of employment,
- and the total for the year.
It also states the following information about an employee:
- National Insurance contributions in that year
- Their statutory payments, such as maternity pay, paternity paid, or shared parental pay and further deductions
- It will also show student loan deductions or postgraduate loans deductions.
Another important part of the P60 is the employer’s full name and address and the PAYE reference, which is often needed to verify the user when applying for other tax forms.
When is a P60 issued?
A P60 is issued annually and no earlier than April 5th, and no later than May 31st,or by the end of the formal tax year (which is effective April 6th– April 5th). Submitting this on time and accurately is the responsibility of the employer.
Ideally, you should give an employee their P60 form on April 5th, or as close to this date as possible.
What should I do with an error on an employee’s P60?
If you become aware of an error, or an employee alerts you to an inaccuracy on their P60, there are some steps you may need to take to rectify a wrong end of year certificate.
Once the change is fixed, and an employer is satisfied with its accuracy, an employer can be supplied with a new P60 marked clearly as a ‘REPLACEMENT’. This can be done in either electronic or paper format, or you can issue a letter confirming that this change has been made.
Where can I get a P60?
You can either order copies of a P60 from the HMRC, if you are exempt from filing online, or you can get them from your payroll software, which is listed as PAYE compliant. You can also use the basic online tax form service that the government provides.