A P60 is issued annually to every employee still employed on 5 April (the last day of the tax year), summarising their full year's pay and deductions. A P45 is issued when an employee leaves — showing their pay and tax from the start of the tax year to their last day. Employers must issue a P45 on or before the employee's last payday, and a P60 by 31 May each year. Failure to issue either can attract HMRC penalties.
P60 and P45 — the key difference
| | P60 | P45 | |---|---|---| | What it covers | Full tax year (6 April to 5 April) | Start of tax year to date of leaving | | When issued | By 31 May after the end of the tax year | On or before the last payday | | Who receives it | All employees employed on 5 April | Employees who leave during the tax year | | Can be issued to leavers? | No | Yes | | Format | Single document (can be electronic) | 3 parts (Part 1A for employee, Part 2 for new employer) |
What is a P60?
A P60 is a certificate showing the total amount an employee earned and the total tax and National Insurance deducted in the tax year. It also shows:
- Employee's name and NI number
- Tax code used at the end of the year
- Total pay and tax for the year
- Student loan deductions (if applicable)
- Employer's PAYE reference
Who receives a P60? Every employee who was on your payroll on 5 April — the last day of the tax year. Employees who left before 5 April do not receive a P60 from you (they received a P45 when they left).
Deadline: You must give P60s to employees by 31 May following the end of the tax year. For the 2025/26 tax year (ending 5 April 2026), P60s must be issued by 31 May 2026.
Format: P60s can be issued electronically if the employee can access and print them. Most payroll software generates P60s automatically.
What is a P45?
A P45 is a leaving document issued when an employee ends their employment with you. It shows:
- Employee's name, address, and NI number
- Date employment ended
- Tax code at leaving
- Total pay and total tax deducted in the current tax year (from 6 April to the leaving date)
When to issue: You must issue a P45 on or before the employee's last payday — not at the end of the month, and not a week later. The timing matters because the employee needs it to give to their new employer so the correct tax code is used.
How to issue: P45s are generated by your payroll software and submitted to HMRC through your final Full Payment Submission (FPS) for that employee. The employee receives parts 1A and 2 of the P45 (part 1 goes to HMRC via the FPS).
What happens if an employee does not have a P45?
New starters who do not have a P45 — perhaps because they were previously self-employed, had been out of work, or their previous employer did not issue one — should complete a Starter Checklist (formerly called a P46).
The Starter Checklist tells you which statement applies to the employee:
- Statement A: This is their first job since last 6 April and they have not been receiving any of the following (JSA, ESA, Income Support, Incapacity Benefit)
- Statement B: This is now their only job, but since last 6 April they have had another job
- Statement C: They have another job or receive a state or occupational pension
Use the statement to determine the correct tax code to use for their first payroll run.
Common mistakes with P45s and P60s
Issuing a P45 late. If an employee starts a new job without a P45 from you, their new employer will use an emergency tax code — meaning the employee may pay more tax than they should until the code is corrected. Issue P45s promptly.
Issuing a P60 to a leaver. If an employee left before 5 April, they should have received a P45 when they left. Do not also issue them a P60.
Not generating P60s through payroll software. Some small employers try to create P60s manually. This is error-prone. Use payroll software — even HMRC's free Basic PAYE Tools generates P60s automatically.
Wrong figures on a P45. If a P45 contains errors, the employee's new employer will use incorrect information. Issue a corrected P45 as soon as possible and notify HMRC.
Frequently asked questions
Can I issue a P60 electronically? Yes — since 2011, employers can issue P60s electronically provided the employee can access and print or save the document. Most payroll software supports electronic P60 distribution.
What if I miss the P60 deadline? HMRC can issue a penalty for failure to provide P60s on time. The penalty starts at £300 and can increase if the failure continues. Issue P60s as soon as possible if you have missed the 31 May deadline.
An employee has lost their P60 — what do I do? You can issue a duplicate P60 clearly marked "duplicate". Employees may need their P60 for tax returns, mortgage applications, or benefits claims, so provide duplicates promptly when requested.
What if an employee works multiple jobs — do I issue a P60 for each? Yes. Each employer issues a separate P60 for the pay and tax relating to their employment. The employee will receive a P60 from every employer they worked for on 5 April.
Can I issue a P45 before the employee's last day? Yes — you can issue a P45 before the last day if you know the leaving date in advance. Just ensure the figures are accurate as of the last payday.
