Your employer has just days left to issue an important tax document — or risk a £300 fine. The deadline for your boss to send you your P60 is May 31. Your P60 summarises your total pay and deductions for the tax year.
What Happens If Your Employer Misses the Deadline?
If your P60 is not sent by May 31, your employer can be fined an initial £300, followed by up to £60 per day for every day it remains unsent. This penalty applies to each employee who does not receive their document on time.
Who Should Receive a P60?
You must be sent a P60 if you were on your company payroll at the end of the tax year, which was April 5. If you have more than one job, you will get a P60 from each of your employers. It is important as mortgage lenders and banks often require your P60 to verify your salary and employment status. You should also check your P60 to see if you have paid the correct amount of tax.
Understanding Your Tax Code
Your P60 will show your tax code, which is made up of a series of numbers and letters and shows how much tax should be deducted from your wages or pension. But there are a number of reasons why your tax code could be wrong — for example, if you recently changed jobs or if HMRC has been given incorrect information from your employer. The most common code is 1257L for people who have one job or pension, although not everyone will be on this.
What to Do If You Think Your Tax Code Is Wrong
MoneySavingExpert.com has a free calculator that you can use to get a rough idea about whether your tax code is correct. If it looks like you have paid too much tax, then you can claim it back by contacting HMRC. You can claim back up to four additional years. If you think you have been overpaying for longer than this, you may still be able to claim under certain circumstances — for example, if it was not your fault that you overpaid tax.
How to Claim a Refund or Pay Back Underpaid Tax
For overpaid tax that does not relate to the current tax year, HMRC will send you a cheque in the post with your refund. If it turns out you have not paid enough tax due to an incorrect tax code, then you will have to pay this back. You can try and get the tax written off if it was not your fault that you underpaid.
What If You Left Your Job?
If you left your job in the previous tax year, you should have been sent a P45 with your tax summary instead of a P60. The P45 serves a similar purpose and should be kept for your records.
