What is P45?
A certificate issued by your employer when you leave a job, showing your pay and tax to date.
Key Facts
- ✓ Issued when you leave a job
- ✓ Shows pay and tax deducted in current tax year to date
- ✓ Give Parts 2 and 3 to your new employer
- ✓ Ensures correct tax code at your new job
- ✓ Without a P45, you may be put on emergency tax
- ✓ Employer must provide it — it is a legal requirement
Explanation
A P45 is a document your employer gives you when you leave a job. It has four parts: Part 1 is sent to HMRC, Part 1A is for your records, and Parts 2 and 3 are given to your new employer. The P45 shows your tax code, total pay, and total tax deducted in the current tax year up to your leaving date. Your new employer uses the P45 to put you on the correct tax code and ensure continuity of your tax record. Without a P45, your new employer may put you on an emergency tax code, which could mean you overpay tax temporarily. If you do not have a P45 (for example, it is your first job), your new employer will ask you to complete a starter checklist instead. Your employer must provide a P45 when you leave — there is no option to decline it. If you are made redundant, the P45 also helps calculate any tax refund due.
Try the calculator: Use our free calculator to see how p45 affects your finances.
Salary Calculator →Other Glossary Terms
The system HMRC uses to collect income tax and National Insurance directly from employee wages.
National InsuranceA UK tax on earnings and self-employed profits that funds the state pension, NHS, and benefits.
Personal AllowanceThe amount of income you can earn each year before paying income tax — currently £12,570.
Basic Rate (20%)The 20% income tax rate applied to taxable income between £12,571 and £50,270.
Higher Rate (40%)The 40% income tax rate applied to taxable income between £50,271 and £125,140.
Additional Rate (45%)The 45% income tax rate applied to taxable income above £125,140.
Frequently Asked Questions
What does p45 mean?
A certificate issued by your employer when you leave a job, showing your pay and tax to date.
Why does p45 matter?
Understanding p45 helps you make informed financial decisions and ensure you pay the correct amount of tax. Getting it wrong could mean overpaying or underpaying HMRC, which may result in penalties or missed savings. Use our calculators to see how p45 applies to your personal situation.
Where can I find more information about p45?
HMRC publishes official guidance on GOV.UK for all UK tax topics. For a quick overview, our glossary entries are written in plain English and updated each tax year. You can also use our free online calculators to model different scenarios and understand how changes to your income, deductions, or allowances affect your overall tax position.