P45 and P60: what they are and when to issue them

The P45 and P60 are two of the most referenced documents in UK payroll, and yet employers regularly get the timing and content wrong. Understanding when each is required, what it must contain, and what happens if you do not issue one correctly protects both the employer and the employee.

The P45 is issued when an employee leaves your employment. It is a statement of the employee's pay and tax deductions from the start of the tax year to the date of leaving. It is in four parts: Part 1 goes to HMRC, Parts 1A, 2, and 3 go to the employee. In practice, since RTI, Part 1 is submitted electronically through the Full Payment Submission and does not need to be posted separately. The employee receives Parts 2 and 3 — traditionally paper, though digital P45s are now permitted in certain circumstances.

The P45 must be issued on or before the employee's last day. Delays are a common failure. An employee who leaves and does not receive their P45 promptly may face incorrect tax deductions in their next job, because their new employer will not be able to use the correct tax code from the outset. HMRC expects P45s to be issued without delay.

The P45 contains: the employee's National Insurance number, date of leaving, details of pay and tax in the current year, the tax code in use at the date of leaving, and the employer's PAYE reference. Where an employee has been on emergency tax, the P45 will reflect that — the new employer can then apply the correct code.

The P60 is an annual summary. It is issued to every employee who is still in employment with you on 5 April (the last day of the tax year). It summarises the employee's total pay and tax deductions for the full tax year. The P60 must be provided by 31 May following the end of the tax year — so for the 2025/26 tax year ending 5 April 2026, P60s must be issued by 31 May 2026.

The P60 is important for the employee because it is the document they need to complete a self-assessment tax return, to verify their income to a mortgage lender, or to reconcile their tax position with HMRC. Failing to issue a P60 on time is an HMRC compliance failure and can cause practical hardship for employees who need the document for financial purposes.

P60s must include: the employee's name and NI number, your PAYE reference, the total pay and tax for the year, the tax code at year end, the total NI contributions paid, student loan deductions (where applicable), and details of statutory pay received in the year.

For payroll teams, the year-end process includes running payroll year-end, submitting the final FPS (or an Earlier Year Update if needed), and generating P60s for all employees in post at 5 April. See our UK payroll calendar 2026-27 for the full list of key dates.

See also RTI submissions: FPS and EPS explained for how P45 data flows to HMRC through the RTI system.

Mellow generates P45s on employee exit and P60s at year end, distributes them to employees via the self-service portal, and archives copies. [Start a free trial →](https://mellowhr.com/register)