A P60 is a form given to all employees by their employer at the end of the tax year. It shows the employee’s income for that year and the tax they’ve paid on it.
A P60 also includes their National Insurance contributions, and other information such as Maternity Pay, Student Loan repayments, and Statutory Sick Pay if applicable.
If you run a limited company and draw a salary you’ll need to issue yourself a P60.
Uses of a P60
If you want to claim back overpaid tax, apply for tax credits, or apply for a mortgage or loan, you’ll need to supply your P60 as proof of your income and the amount of tax you’ve paid on your salary. It’s an important document to keep around.
The good news is that if you do happen to lose your copy of the P60, you can check all the information via your HMRC personal tax account.
If you receive a P60 you should carefully check the information on it. Too little tax paid could mean facing penalties from HMRC, and too much paid could make you eligible for a tax refund. Let your employer know if there are any discrepancies.
P60 responsibilities for employers
Employers are required to issue a paper or digital copy of a P60 to each employee on their payroll at the end of the tax year, as well as supply a digital copy to HMRC. If there are any errors, they’ll need to provide a replacement with the information corrected.
See related terms
This glossary is for small business owners. The definitions are written with their requirements in mind. More detailed definitions can be found in accounting textbooks or from an accounting professional. Xero does not provide accounting, tax, business or legal advice.