Why have you just been given a P60? What does it mean and what is the point in your P60?
Well, firstly do not panic, a P60 is not bad news. So, read our guide on P60s and set your mind at rest!
What is a P60?
A P60 is a form that explains how much you have earned across the tax year (from 6th April to 5th April the following year). It details how much you have paid in National Insurance (NI) and Pay As You Earn (PAYE) income tax.
The details on your P60 are drawn from information submitted by:
- You, if you have done a self-assessment tax return
- Your employer; including payments of commission, bonuses, benefits, the hours you work and your salary
- Your pension provider; detailing your total contributions, how regularly you pay into your pension pot, and all tax deductions.
- The Department of Work and Pensions; which details any benefits or allowances you have been paid.
Where does my P60 come from?
Your employer or pension provider (if you are retired) as of the 5th April will give you the form, but it is HMRC who generates the information captured on the form.
Who receives a P60?
Anyone receiving a salary or retired (and being paid a pension) on 5th April should receive a P60. You should be given your P60 at any point up until the 31st May of that year. Therefore…you are not alone when you receive this form. The majority of your colleagues will be probably be given a P60 at the same moment.
Why is Your P60 Important?
Your P60 is proof of the tax you paid in that financial year. You can be asked to provide a copy of your P60 when applying for a rental property, a flat or other financial services. It acts as a proof of your salary. Therefore – hang-on to it.
Check your P60!
Simply put – errors happen. P60’s are generated from different sources of information by HMRC and then distributed by your employer. But, you are responsible for making sure everything is correct.
Just double check things such as personal tax allowances or any business expenses that have been claimed are detailed on the form.
If you are working more than one job at the 5th April you will have more than one P60. Therefore double check the forms are showing your complete income.
If your P60 is wrong, talk to HMRC to correct it.
Your P60 should be checked by you and then filed away with all your other financial documents. You may never have to touch it again…but like all your financial documents there could be a moment (when you least expect it) that you need to lay your hands on it!
Worst case scenario…you lose it…talk to your employer they can send you another copy.
About The Author
Simon Royston is the founder and Managing Director of The Recruitment Lab (A Brighton recruitment agency and Aldershot that offers employment services across Berkshire, Hampshire, Surrey, Sussex, and beyond). Simon lives in Guildford and has worked in Recruitment for over a decade. He has a degree and a master’s in psychology as well as a diploma in Human Resource Management. If you would like to know more about anything written in this blog or would simply like to express your own thoughts and opinions do not hesitate to contact Simon through The Recruitment Lab website.