A P60 is a crucial document issued to employees at the end of each tax year, detailing their annual earnings alongside the total amount of National Insurance and PAYE Income Tax paid to HMRC. This form, provided by your employer, consolidates data from various sources:
- Your employer, covering your salary, bonuses, benefits, and hours worked.
- Yourself, if you’ve submitted a Self Assessment tax return.
- Your pension provider, with details on your contributions, payment frequency, and any tax deductions.
- The Department for Work and Pensions, for any state benefits received.
Why is a P60 significant?
This document not only serves as a record of your tax payments for the year but also as proof of your income, which is necessary when applying for loans, mortgages, or renting properties. It can also be crucial for resolving tax disputes with HMRC or when filing a Self Assessment tax return.
What to verify on your P60
Given that P60s are generated automatically by HMRC and your employer, it's possible for errors to occur. Ensure that the information on your P60 aligns with your payslips. If you have multiple jobs, confirm that your total earnings from all sources are correctly reflected. Note that you may receive multiple P60s if you're employed in more than one job.
Do self-employed individuals receive a P60?
Typically, self-employed individuals do not receive a P60 because this document is issued by employers. For those needing proof of income for financial applications, an SA302 form, which outlines your earnings for the past four years based on your tax returns, can be used instead.
