Solution Properties
Solution ID:
200427112156068
Last Modified Date:
Fri Nov 22 09:25:56 UTC 2024
Taxonomy Path:
Case category//How do I...//governmental/legislative compliance
Author:
[email protected]
Enter a P45 for a new starter
Description

When you add a new employee to your software, you must enter the details from their starter form. The employee provides a P45 from their prior employment. If this isn't available, you must enter the details from a P46 Starter Checklist from gov.uk that your new employee has completed.

NOTE: If you need to upgrade the number of employees in your software, leave your details and we'll call you back.

Cause
Resolution

Don't enter negative P45 figures into an employee's record. If you believe an employee's tax is incorrect, you can check the HMRC Taxable Pay Tables Manual Method. Also contact the HMRC Employer Helpline before you enter the year to date (YTD) details into the employee's record. For further help with these go to gov.uk

If you receive a P45 for the previous tax year, and don't have an employee record, use the details apart from YTD values.

P45 date

Don't enter year to date values if your employee's P45 is from a prior tax year. Compare the leaving date on the P45 to your process date to check this.

Each tax year runs from 6 April to 5 April. 

Your software prevents you from entering year to date values when they're not required.

The program compares the Date left previous employment that you enter from the P45 to your Process Date. If they're in different tax years, the P45 year to date fields aren't available. 

If this occurs, ignore the year to date fields and add the tax code from the P45 then continue as normal.

Already set the employee up with a P46 Starter checklist

Sometimes, you may have set up an employee using a P46 starter checklist and sent their first FPS when your employee hands you their P45.

Your next steps depend on whether you've received a tax code for the employee from HMRC. 

I've received a new tax code notification from HMRC

  • Use this notification to update the employee's tax code and year to date information
     NOTE: Don't enter any values from the P45 in this scenario.

Haven't received a new tax code notification

Enter the P45 details in the employee record. 

 NOTE: Only enter values from a P45 if the leave date on it is within the tax year you're currently processing. 

  1. Double-click the relevant employee on your employee list.
  2. Select the Employment tab then YTD Values.
  3. Under Previous (P45) Employment, enter the Gross Pay for Tax and Tax Paid from the P45.

To find out more, go to Gov.UK. If you're not certain which tax code to enter for them, go to the Gov.UK work out your new employee's tax code tool.

Enter the P45 details

  1. Go to Employee.
  2. Double-click the relevant employee, then select Starter Form.
  3. From the drop-down list, select P45, then Next.
  4. Complete the following information:
    Starting Declaration

    Choose one of the following starting declarations:

    • Statement A - This is their first job since last 6 April. They haven't been receiving taxable Jobseeker's Allowance, Employment and Support Allowance, taxable Incapacity Benefit, state pension or occupational pension
    • Statement B - This is their only job, but since last 6 April they've had another job, or have received taxable Jobseeker's Allowance, Employment and Support Allowance or taxable Incapacity Benefit. They don't receive a state or occupational pension
    • Statement C - They have another job or receive a state or occupational pension

    Old style P45s don't include this information, you'll need to ask your employee to complete the declaration.
    Previous Employment Tax Dist./Ref. Enter the Employer PAYE reference from box 1 on the P45.
    Date Left Previous Employment Enter the Leaving date from box 4 on the P45.
    Tax Code at Leaving Date Enter the Tax Code at the leaving date from the P45.
    Was this on a Week 1/Month 1 basis? From the drop-down list, choose Yes or No.
    Total Pay to Date Enter the Total pay to date under box 7 on the P45.
    Total Tax to Date Enter the Total tax to date under box 7 on the P45.
    Continue Student Loan Deductions? From the drop-down list, choose Yes or No. If you need to make student loan deductions, Y appears in box 5 on the P45.
    TIP: Plan types 1 and 2 apply to Student loans. Plan type 4 is for a Postgraduate Loan. If you aren't certain which loan to apply, you can ask your employee to verify the required type.
  5. Once complete, select Next, then Finish.

To increase accuracy for people with a P45 and more than one job, avoid selecting statement C and using the tax code BR. Instead, select statement B and use the tax code on the P45. Unless the tax code on the P45 is BR, 0T or D prefix in which case statement C still applies. Individuals without a P45, or with an old P45, will continue to complete the starter declaration. For more information, go to the gov.uk

The next time you pay this employee, if they're on a cumulative code, payroll uses the values you've entered to calculate the tax.

[BCB:363:Sales – Sage HR leave management:ECB]

 

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