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What is a P60? A guide for small businesses

June 24, 2022
If you’ve ever been in employment, chances are you’ve received a P60 from your employer. You might not have given this document too much thought in the past before, but as a small business owner the responsibility to distribute P60s to your employees sits with you.With this in mind, getting to grips with what exactly a P60 is could save you a lot of trouble with HM Revenue and Customs (HMRC) in the long run, and might even stop you from overpaying on your tax bill.In this guide we’ll be answering all your P60-related questions, covering what they are, what they’re used for and how to get them, if you can.

What is a P60?

A P60 is a statement or certificate summarising how much you’ve been paid through Pay As You Earn (PAYE) in a given tax year (from 6th April to 5th April the following year), along with any deductions taken at source from your pay packet.

Alongside the total amount you’ve earned through PAYE, you’ll get a breakdown of any statutory payments — such as maternity pay, adoption pay or bereavement pay — you’ve received from your employer, as well as any student loan repayments and the total amount you’ve paid in Income Tax and National Insurance contributions (NICs).

    Your latest Self Assessment tax returnYour employer, including your salary, the hours you work and any benefits you receiveYour pension provider, such as contributions, how regularly you pay into your pension and any tax deductionsThe Department of Work and Pensions, detailing any state benefits you’re paid

What do I need a P60 for?

    You’ve paid too much tax and are making a claimYou want to apply for tax creditsYou need proof of your income if you’re applying for a loan or mortgage

What does a P60 look like?

You can find a blank P60 form for the tax year 2022 to 2023 under the PAYE draft forms section on the GOV.UK website, or you can download an empty P60 single sheet here.

On this form, you’ll find boxes for following information:

How do I get a P60?

If you’re employed, whether it’s on a full-time or part-time basis, you’ll get your P60 from your employer. If you’re working more than one job, you’ll get a P60 from each employer for that tax year.
Alternatively, if you’re an employer and you need to produce P60s for your employees, the easiest way to do this will be by using payroll software. You can also order paper copies from HMRC, but keep in mind they can take up to 7 working days to arrive.

You’ll need to file P60 forms for all the employees on your books on 5th April each year, with the forms provided to your employees by 31st May the same year at the latest. These forms can either be printed or sent over electronically.

What if I miss the deadline?

If you miss this deadline, make sure you give your employees their P60s as soon as possible. Failure to do so could see you fined up to £300 for late issuing, with an extra £60 every day past the deadline until you issue the P60.

What if there’s a mistake?

Noticed a mistake on an employee P60? Not to worry — you can reissue a P60, but if you do this HMRC states you should clearly label is ‘replacement’, or give your employee a letter confirming the update.

I’m self-employed. Will I get a P60?

If you’re the director of a limited company and draw a salary, you’ll need to generate a P60 for yourself. You’ll also be given a P60 if you’re both self-employed and employed — for example, if you work part-time in a coffee shop but are also a freelancer in your free time.

Since P60s can only be issued by an employer (as a limited company director you are, technically, employed by the company), sole traders can’t get P60s.If you run a sole trader business and don’t receive a P60, but need one to, say, apply for a mortgage, you can use an SA302 to show evidence of your earnings over the last 4 years instead.

How can I get a tax refund with my P60?

Whether you’re issuing P60s to employees or have just received a P60 from your employer, it’s always a good idea to scrutinize the numbers on the P60 in front of you. Any missed mistakes could mean you’re either overpaying or underpaying tax — neither of which are good for your bank account.Some of the most common reasons for overpaying on tax includes:
    A new joiner being put on an emergency tax code (BR) in the initial stages of their employmentAn employee having more than one job at the same timeA change in circumstance, e.g. going from part-time to full-time employment
If you or one of your employees are looking to claim a refund from HMRC, they can do so at the end of the financial year in which they overpaid. To do this, they’ll need the following information to hand:
    National Insurance numberEmployer Reference Number (ERN)P45 and P60How much they earnedHow much tax they paidHow much they think they’ve overpaidEmployees can claim a refund from HMRC after the end of the tax year in which they overpaid
If you’ve noticed a mistake from a previous P60, you might still be able to claim back on it. Taxpayers have up to 4 years from the end of the tax year in which they overpaid to claim a refund from HMRC.

What do I do if I’ve lost my P60?

If you’ve lost your P60, you can ask your employer to send a replacement, or you can find the information on your P60 when you sign into your personal tax account.