A document issued by an employer to an employee when they leave a job. It shows details about the employment, including their start and end dates, how much they were paid, and how much tax they paid during their employment.
The P45 is made up of four parts: Part 1 is sent to HM Revenue & Customs (HMRC), Part 1A is kept by the employer, and Parts 2 and 3 are to the employee as a record of their earnings and tax paid.
RTI electronically sends the HMRC sections of the p45, so nothing needs to be physically sent.
The P45 is an important document that employees need to give to their new employer when they start a new job (provided it relates to the same Tax year) as it provides information about their tax code and previous earnings, which helps the employer calculate their tax and National Insurance contributions.
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