P45 Explained
The form your employer gives you when you leave a job. It carries your tax code and year-to-date pay figures to your next employer, preventing emergency tax.
What is a P45?
A P45 is a four-part form that your employer must give you on or before your final payday. It records your tax code, total gross pay from 6 April to your leaving date, and the total Income Tax deducted during that period.
Part 1 goes directly to HMRC. Part 1A is yours to keep. Parts 2 and 3 are handed to your new employer so they can apply the correct tax code straight away. Without it, you risk being put on emergency tax.
How it works
When you hand Parts 2 and 3 to your new employer, they submit the details to HMRC via Real Time Information (RTI). HMRC then confirms or updates your tax code. The whole process usually takes 1 to 3 pay periods to settle.
Your new employer uses the cumulative pay and tax figures from the P45 to calculate the correct deductions for the remainder of the tax year. This prevents you from losing your Personal Allowance or being taxed at the wrong rate.
If you have lost your P45 or never received one, your new employer will ask you to fill in a Starter Checklist instead. This was previously known as a P46.
Real example
James leaves his £30,000 job on 31 August 2025, five months into the tax year. His P45 shows:
| Field | Value |
|---|---|
| Tax code | 1257L |
| Total pay to date | £12,500 |
| Total tax to date | £1,340 |
| Leaving date | 31/08/2025 |
His new employer uses these cumulative figures. Because £12,500 is below the annual Personal Allowance of £12,570, James has barely used any of his tax-free amount. The new employer can apply the remaining allowance across his future pay periods.
Who does this affect?
Anyone leaving paid employment receives a P45. This applies whether you resign, are made redundant, or reach the end of a fixed-term contract. It also covers part-time and temporary roles.
Self-employed individuals do not receive a P45 because they are not on a PAYE payroll. Contractors working through an umbrella company do receive one because the umbrella acts as their employer.
HMRC source
gov.uk/paye-forms-p45-p60-p11d/p45 explains when your employer must give you a P45 and what each part is used for.
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