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A P45 is a document that an employee receives from their existing employer when they leave a job. The employee can receive an electronic or paper copy from their old employer. It provides tax and payroll information that an employee can pass on to their new employer and also keep for their own tax records. HMRC used to be issued with a paper copy as well, but now this is sent as an electronic payroll report. This process is known as RTI (Real Time Information).
The employee sends a copy to the new employer to input the data into their payroll system and notify HMRC electronically.
You may receive a P45 from your pension provider if you take your whole pension fund as a lump sum. This is because part of this fund is treated as taxable earnings and will need to be reported to HMRC. You will therefore receive a P45 for your own records and also to pass on to a new employer if you are continuing to work.
A P45 includes:
The information included in the P45 will enable a new employer to update their payroll software to ensure that the member continues to be taxed at the correct rate.
P45s don’t show National Insurance deductions or pension contributions, so it may be useful to keep copies of final payslips in case they are needed to trace a member when they reach retirement.
You can request a P45 if your old employer or pension provider has not sent you one. There may be a delay until after their final payroll has been processed.
If you are starting a new job before receiving your P45, you can complete a starter checklist that your new employer can then input into their payroll system. This will allow your new employer to calculate a temporary tax code until they are notified of your new tax code by HMRC.
Your P45 will be issued within one or two business days of your lump sum payment being made. This will be sent to you by email, so it is important that we have your correct email address on our records. It could be sent through a paper copy if we do not have your email address, but this will usually take five to ten working days.
It is not possible for us to send a copy of your P45 as this is an official document, however, we can provide you with a letter that will detail the same information and will be accepted by HMRC.
Smart Pension members can view their P45 on a mobile app hosted by ‘netpaydue’. You will receive an email from us containing the log in details so that you can view your payslips, P60 and P45 online.
You can also ask your former employer or pension provider to email you a digital copy of your P45 if possible, but you won’t be able to view it anywhere else online.
However, the information provided in it can be viewed by signing into your personal tax account on the Government Gateway.
You can register for a Government Gateway account here. Further details around Smart Pension signposting to third-party links can be found in our privacy policy.
Your P45, like all tax records, should be kept for six years from the end of the tax year that they relate to. It is important to know that HMRC can carry out retrospective checks for up to 20 years, so it is useful to keep hold of it for longer in case any queries arise. The P45 you receive from your employer must be for the current tax year and not a previous tax year. Details about the tax paid in a previous tax year will be included in a document called a P60.
Both P45 and P60 are important for proving salary and tax paid and should be retained by the employee and employer for at least six years.
If you require any help or have any questions about your P45, contact our support team on 0333 666 2626 between Monday to Friday, 9:00am to 5:00pm.