The UK tax system involves a whole host of different slips, forms and certificates: P60s, P14s, P45s, P46s… it can all get a little confusing. If you’re just getting started as a professional it can be hard to know which ones of these are crucial and what they are for, and all too easy to dismiss uninteresting or unimportant looking forms that can lead to problems in the future. This article then will detail the exact uses of the P60, why you need it, and how it can benefit you to keep it safe.
P60, also known as ‘end of year certificate’, is a form which an employee receives at the end of each tax year in the UK (the UK tax year ends in April) detailing their precise wages for that year. This is the employee’s copy of the P14 – which contain the wage information for all employees and are filed with HM Revenue and Customs at the end of each year. As well as showing the exact wages an employee has received, they also include any Income Tax or National Insurance that has been deducted, as well as statutory payments including SMP, SAP and SPP. It may also include any Student Loan repayments or other repayments that have been deducted.
This form is important for a number of reasons, both legal and personal, and if you have no P60 information it can cause considerable problems. Firstly, the law requires you to keep a record of any taxable income for six years. Realistically this means you should at all times know where your P60s are located. It’s highly recommended that you keep all your P60s somewhere safe – ideally in a filing cabinet or a ring binder so that they can be easily accessed when necessary.
This means that if requested, you can present a copy of your P60 for inspection upon request. This can be useful if you are under going a tax inspection as it can act as proof of your wages. Similarly it can be useful if you are reclaiming excess tax, which is difficult if you can’t prove how much income you’ve received. For anyone who needs to fill out a tax return a P60 can be very helpful.
If you are applying for a loan or mortgage you may be required to present your P60 in order to demonstrate that your earnings will allow you to pay it back. If your P60s are damaged or lost then it is important that you make efforts to obtain the information and one way to do this is with a replacement P60.
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You can learn more about P60 and Advanced Payroll Services at author's website. They also provide P60 Payslips in UK.
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