What procedures must be followed when applying the details from a P45 for a new employee? (Part 3 of 3)

Part 1 of this Employer FAQ considers the checks that an employer must make to the first six of the seven items that appear on Part 2 of a form P45 that is provided by a new employee.  Part 2 explains the check that must be carried in all cases to ensure that the tax deducted from the employee’s future earnings, as entered at item 7, is calculated correctly.

When all of the checks to items 1 to 7 on Part 2 of the P45 have been completed, the additional items on Part 3 of the P45, i.e. items 8 to 17, must be filed online.

The following notes show the details that are required.  They are listed in the order that they appear on the paper Part 3, even though all but the relatively few exempt employers must file the details online.  If the employer is using a computerised payroll system to file the Part 3 information, it may be compiled from the information already set up in the system for the new employee.

Item 8: enter the new employer’s PAYE reference, to enable HMRC to transfer the employee’s tax records from the tax office of the previous employer to the tax office of the new employer.

Item 9: enter the date on which the new employment began.

Item 10: enter the employee’s works or payroll number.

Item 11: enter ‘P’ in the box provided if the employee will not receive any pay between the day the employment started and the following 5 April; i.e. the employee’s first wage or salary payment will be taxed in the next tax year.

Item 12: enter the tax code (including an ‘X’ as the W1/M1 indicator, where appropriate) that the employer will apply from the date the employee started where it differs from the code used by the previous employer.

Item 13: enter the amount of tax that should have been paid in the previous employment, where this differs from the figure quoted by the previous employer, as determined by the new employer (or automatically by the payroll system) from the mandatory check of item 7.

Item 14: enter the job title used by the employer in respect of the employee’s duties.

Item 15: enter the employee’s full private address, including postcode and country.

Item 16: enter the employee’s gender (mandatory).

Item 17: the employee’s actual date of birth (mandatory).

Item 18: enter the employer’s name, address, and date of completion, declaring that a payroll record has been opened for the new employee.