P11D, P45, P60: A Complete Guide

P11D, P45 and P60 are all important documents no matter if you are an employee or employer. They play a key role in reporting the amount of tax paid by an employee (as well as tax paid by employers on their behalf) of any given business to HMRC. 

In this article, we’ll dive into P11Ds, P45s and P60s, so if you’re a small business owner looking at taking on your first batch of employees, you’ll know just what to do.  

If you want to learn more about payroll first, read our ultimate payroll guide.  

Or if you just want to get straight to the point, you can speak to our payroll team.  

 

Quick Summary

P11D: A P11D is used to report any ‘benefits in kind‘ an employee has received over the tax year (April 6th to April 5th following year). This report is made by the employer and used by HMRC. A P11D is for benefits given to employees that aren’t covered in their salary but are subject to tax. 

P45: A P45 is given to an employee once they leave a business. It covers how much they’ve earned and how much tax they’ve paid while they’ve been working there.  

P60: A P60 is given to each employee at the end of the tax year and is used to outline all the taxes the employee has paid on their salary over the year.

 

Benefits in Kind

Let’s set the scene with a bit of background information on P11Ds and ‘Benefits in kind.’ 

Benefits in kind are essentially benefits an employer gives to an employee that they must pay tax on. Some examples of benefits in kind are:  

• living accommodation 
• cars and car fuel 
• vans 
• interest-free and low-interest loans 
• relocation expenses 
• mileage allowance payments 

• Private medical insurance 

If you provide any of these to your employees they must be reported to your company’s P11D form.  

You can learn more about benefits in kind and the extensive list of taxable benefits in our guide. 

Now we’ve covered the basics let’s dive a little deeper and break down what each form covers, and the laws that must be followed to ensure your business is fully compliant with the latest guidance. 

 

P11Ds 

As we’ve mentioned P11Ds are used to report employees’ benefits in kind to HMRC, some examples of benefits in kind are interest-free loans or a company car, both of which the employer will have to pay tax on. 

So, in the same way, the P60 form is designed to show the tax an employee has paid on their salary, the P11D is for the tax paid by the employer on any employee benefits.  

Note that even though the P11D is for the employee, it is the employer who will be paying the tax on their benefits.  

It’s also important to note that those who are self-employed, such as sole traders or freelancers, will not need to file a P11D for themself, instead their expenses will be shown on their self-assessment form.  

So if you’re an employer when do you need to file your employee’s P11Ds and what do you need to include with them? 

For the deadline, that’ll be the 6th of July following the tax year, so with most tax years ending on the 5th of April that gives you just over 3 months to get your P11D sorted.  

If you’re late delivering your P11Ds to HMRC you’ll be fined £100 per 50 employees for each month, until they receive it. If you’re late paying HMRC you may also be charged additional penalties and interest on what you owe.  

Finally, some big (and old) news regarding P11Ds is that they’ll be redundant from April 2026 when the payrolling of benefits in kind will become mandatory. Therefore, from April 2026, all benefits in kind will need to be reported through your payroll software, so if you haven’t yet, time to get yourself a tech-savvy payroll manager.  

 

P60

So now we’ve got the more complicated form out of the way, we can go onto the easier ones to understand.  

As we’ve explained, a P60 serves the purpose of detailing the amount of tax an employee has paid on their salary over the year.  

The deadline for an employer to give their employee their P60 is the 31st of May following the end of the tax year (April 5th). 

P60s are useful for employees who are looking to take on a large amount of debt (such as a mortgage) to prove to the bank that they have the income to pay it back.  

Note that if you’re self-employed you do not need to provide yourself with a P60 (as with a P11D). If you need to provide proof of income as a self-employed individual there are many ways you can do this, and we can help you with that.  

If you believe you may have overpaid on your tax or other deductions, it can be really important for you to review your P60 to see if anything has gone wrong. A very common type of overpayment which can be refunded is with student loans.  

If P60s are issued, late fines for employers start at £300 with an additional £60 a day until the employer sends them off to their employees.  

 

P45

Finally, the P45 document is given to employees by the employer once they leave a business. The P45 summarises the total tax paid by the employee so far in the tax year.  

Providing a P45 to leaving staff members is a legal requirement as it must be used by their new employer payroll team to make sure they’re being taxed correctly. 

Usually, a P45 will contain information such as an employee’s full name, national insurance number, tax code and salary.  

A P45 is broken down into 4 parts, part 1, part 1A, part 2 and part 3.  

• Part 1 is sent from the employer to HMRC. 
• Parts 2 and 3 are sent to the employee’s new employer.  
• Part 1A is kept by the employee for their records.  

While there are no penalties for not giving your employee a P45, the employee can choose to report you to HMRC who could then begin an investigation into your payroll practices.  

Wrapping up

It may seem simple but P11Ds, P60s and P45s play an important part in how many business payroll departments share important information with HMRC. 

Doing them right and on time is vital to avoiding fines and investigations.  

If you are an employer or an employee, these forms are essential to make sure everyone is being taxed what they should.  

The last thing anyone wants is to be paying more tax than they should be. However, we can help. If you’re looking for advice on tax or payroll, get in touch with our team today and we’ll see what we can do for you.