RELENTIFY
HR & PayrollUK Guide

P45, P60, and P11D Explained: What Each Form Means and When to Issue Them

8 June 2025·Relentify·12 min read
Stack of payroll forms on an office desk

If you run payroll in the UK, you will encounter three forms repeatedly: the P45, the P60, and the P11D. Each serves a different purpose, and each comes with specific rules about when it must be issued and what it must contain. This guide explains what each form means and when to issue them.

Despite being fundamental to UK payroll, these forms are a source of confusion for many employers. Let's clear that up.

The P45: When an employee leaves

A P45 is issued when an employee leaves your employment. It contains a summary of their pay and tax for the current tax year up to the date they left.

Think of it as a handover document. Your departing employee takes it to their new employer, who uses it to avoid putting them on an emergency tax code. You use it to confirm your tax obligation to that person has ended.

What goes on a P45?

The P45 contains:

  • The employee's name and National Insurance number
  • Their tax code at the date of leaving
  • The date they left your employment
  • Total pay in the tax year up to the leaving date
  • Total income tax deducted in the tax year up to the leaving date
  • Your employer PAYE reference

The form has four parts. Part 1 is sent to HMRC (automatically via your RTI submission). Parts 1A, 2, and 3 go to the employee. The employee hands Parts 2 and 3 to their new employer. Part 1A is for their records. (You could technically track it all on four separate bits of paper, but that's what the form does for you.)

When to issue a P45

You must issue a P45 on or before the employee's last working day. Most employers generate it as part of the final pay run. Do not wait for them to ask — it is a legal obligation, not a favour.

If an employee dies while employed, you still complete a P45 and send it to HMRC. Parts 2 and 3 go to their personal representative.

Why the P45 matters

Without a P45, the new employer will not know how much the employee has earned or how much tax has already been deducted this tax year. Result: they apply an emergency tax code, the employee overpays tax, and HMRC sorts it out months later. Nobody wins.

For you as the leaving employer, the P45 confirms that your tax deduction obligation for that individual has ended.

The P60: End-of-year summary

A P60 is a summary of an employee's total pay and deductions for the entire tax year (6 April to 5 April). It is issued to every employee who is on your payroll on 5 April (the last day of the tax year).

If a P45 is "here's what happened to this person while they were with us," a P60 is "here's what happened to this person all year."

What goes on a P60?

The P60 contains:

If you have issued statutory sick pay, maternity pay, or paternity pay during the year, those amounts appear on the P60. This is why keeping clear records of statutory payments throughout the year matters — you cannot guess the totals on 31 May.

When to issue a P60

According to HMRC's P60 guidance, you must issue P60s to all employees on your payroll at 5 April by 31 May following the end of the tax year. That gives you just under two months.

P60s can be paper or electronic. If you issue them electronically, the employee must be able to print or save a copy. (Paper is getting rarer, but some employees prefer it, and that is fine.)

Employees who left during the tax year do not get a P60 — they got a P45 when they left, which serves the same purpose for the time they were employed.

Why employees need the P60

Employees need it for:

  • Self-assessment tax returns
  • Mortgage or loan applications (proof of income)
  • Tax refund claims
  • Benefit applications
  • Proving income to landlords or other third parties

As an employer, issuing P60s on time and correctly is a legal requirement. Late issue attracts HMRC penalties.

The P11D: Benefits in kind

A P11D is used to report non-cash benefits — items of value you provide to employees that do not go through payroll. Company cars, private medical insurance, interest-free loans above a threshold, housing, gym memberships, professional subscriptions. If it has a taxable value and it is not wages, it probably belongs on a P11D.

The purpose: HMRC wants to tax the employee on the cash equivalent value of the benefit. Without a P11D, you would be letting employees pocket perks tax-free, and HMRC does not like that.

What gets reported on a P11D?

Common items:

  • Company cars: Make, model, CO2 emissions, list price, dates available. The car is taxed using a formula (HMRC has tables that do the calculation for you).
  • Private medical insurance: The annual cost of the premium, or the cash equivalent if the employer pays the provider directly.
  • Interest-free or low-interest loans: If the total outstanding balance exceeds a threshold at any point in the tax year, the interest forgone becomes taxable.
  • Living accommodation: If you provide housing.
  • Assets for private use: Company equipment used at home, for example.
  • Subscriptions and memberships: Professional bodies, gyms, sports clubs, etc., paid by the employer.

You do not report items covered by a dispensation or that are exempt — such as mobile phones provided for business use, workplace parking, or works canteens.

When to file P11Ds

P11Ds are submitted to HMRC by 6 July following the end of the tax year. You give copies to affected employees by the same date.

Alongside P11Ds, you file a P11D(b) form, which summarises the total Class 1A National Insurance due on all reported benefits. You pay the Class 1A NI by 22 July (or 19 July if posting the cheque, because the Royal Mail apparently still exists).

Payrolling benefits as an alternative

Instead of filing a P11D, you can "payroll" the benefit. This means adding the cash equivalent value of the benefit to the employee's taxable pay each month, so tax is deducted through normal PAYE.

Advantages:

  • You do not file an annual P11D
  • Tax is collected in real time, so no catch-up needed later
  • The employee sees the benefit value on every payslip, so no surprises

Disadvantage:

  • You must register with HMRC before the tax year starts
  • You still owe Class 1A NI on the benefit, but through a different route

If you offer significant benefits like company cars or medical insurance, payrolling is worth considering. It reduces the annual admin burden.

Common P11D mistakes

  • Forgetting to report a benefit: If you provide any non-cash benefit, check whether it needs reporting. Exemptions are specific — do not assume.
  • Wrong valuations: The cash equivalent of a benefit is not always obvious. Use the right formula for company cars. Use the premium cost for medical insurance. Get it wrong, and HMRC will correct you and charge interest.
  • Missing the 6 July deadline: Late filing attracts penalties. Mark the date in your calendar in January, not July.
  • Forgetting Class 1A NI: Reporting the benefit is half the job. You also owe employer Class 1A NI. This is a common and expensive oversight.

How these forms fit together in your payroll cycle

All three forms are generated from your payroll records. The better your payroll data, the easier they are to produce.

Form When issued What it covers
P45 When employee leaves Pay and tax to the leaving date
P60 By 31 May each year Full-year pay and tax summary
P11D By 6 July each year Non-cash benefits reported separately

A modern payroll platform handles all three automatically. RTI (Real Time Information) means HMRC gets your payroll data as you run pay runs, so reconciliation is straightforward. When you set up PAYE correctly as a new employer and process leaver payments, the system generates the P45. At year-end, it produces the P60 and P11D.

If you are already submitting to HMRC via RTI, you are halfway there. The forms are mostly just a summary of what you have already reported.

Your payroll calendar: when these deadlines matter

To avoid scrambling:

  • Any time an employee leaves: Generate P45 immediately. Do not delay.
  • 5 April (end of tax year): Make sure your final pay run is processed and all statutory payments are recorded. You have seven weeks to generate P60s.
  • 31 May: P60s must be issued to employees.
  • 6 July: P11Ds must be filed to HMRC and copies given to employees.
  • 22 July: Class 1A NI payment due.

If you are using payroll software with a calendar feature, set these dates as reminders in January. If you are tracking these manually (we do not recommend this), a spreadsheet with dates and a highlight colour for "due soon" is better than nothing.

Frequently Asked Questions

What if an employee requests a P45 but is still employed?

You cannot issue a P45 for someone still on your payroll. If they are moving jobs and their new employer requests the form, tell them to come back after their last day with you. If the new employer is panicking about waiting, you can send a letter confirming their employment dates and current tax code, but that is not a P45.

Can I issue P60s early?

Yes. You can issue P60s at any time after the end of the tax year (6 April). You do not have to wait until 31 May. Some employers issue them at the start of May to get ahead of the deadline. If you do this, double-check your figures — you cannot change them once issued.

What if I have a director on my payroll? Do they get a P60?

Yes, if they are employed on 5 April. Directors who are also shareholders sometimes think they do not need employment paperwork — they do. Pay them a salary through PAYE, issue a P60 and P45 like any other employee, and report any benefits on a P11D. (Directors might also need dividend paperwork, but that is separate.)

Do I need to report a benefit if an employee is about to leave?

If the benefit is still in force on or after the end of the tax year, yes. If an employee is leaving on 30 April and you are providing them a company car until then, the car is not reported on a P11D (because the tax year ends 5 April, and the car was not provided in that tax year). If you are providing the car and they leave on 20 July, you report it on the P11D because it was provided during the 6 April–5 April tax year.

What if I miss the deadline for filing P11Ds?

HMRC will charge a penalty. The amount depends on how late you are. One month late: £100 per 50 employees (rounded up). Six months late: £500 per 50 employees. Twelve months late: £1,000 per 50 employees. Additionally, interest accrues on any unpaid Class 1A NI. Do not miss the deadline.

Can employees challenge their P60 if they think it is wrong?

Employees can ask you to correct an error on their P60. If you have recorded the wrong gross pay, tax, or NI, you should correct it and issue a revised P60 immediately. If the employee disagrees with the figure but you believe it is correct, you can ask them to check their payslips — your P60 should match the sum of their individual payslips. If there is a genuine discrepancy, contact HMRC for guidance.

Should I use paper or electronic P60s and P45s?

Either works legally. Paper is becoming rare and is more expensive to print and post. Electronic (usually PDF email) is faster and the employee can save or print a copy themselves. Choose electronic unless the employee specifically requests paper.

What to do next

These three forms are non-negotiable compliance requirements. Miss a deadline or issue wrong information, and you face HMRC penalties. But they are not complicated — they are just summaries of data you should already have.

If you are managing payroll manually, find payroll software that generates these forms automatically. You still need to understand what they are (now you do), but you should not be building them by hand.

Start by mapping your payroll calendar for the year ahead. Identify your P45, P60, and P11D deadlines. If your payroll software has calendar reminders, enable them.

Get it right, and payroll compliance becomes routine. Get it wrong, and HMRC sends a letter.

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