There are occasions where a new employee will start work with you, and not have a P45. Whilst employers have a legal obligation to provide a P45, employees can misplace the document easily. Occasionally an employer will not provide the employee with a P45, and the employee will not chase them.
Sometimes your employee will commence employment with you in a new financial year, and the P45 they have will be from the previous year, rendering it useless.
In these cases you should ask your employee to complete a HMRC New Starter Checklist. This document replaces the previously used P46. Whilst P46 master documents can still be found when searching on the internet, is was succeeded by the New Starter Checklist in April 2014 and should no longer be used.
The form should be completed by your employee fully, but to allocate the correct tax code the area under Employee Statement should be checked.
- If the employee has selected statement A (This is my first job…) you should use tax code 1100L
- If the employee has selected statement B (This is now my only job…) you should use tax code 1100L W1M1
- If the employee has selected statement C (As well as my other job…) you should use tax code BR
If you are unable to get a New Starter Checklist from your employee, you should use tax code 0T
If the tax code requires amendment HMRC will send a tax code amendment. This can be received by the employee through the post, but more possibly via the payroll directly from HMRC. If the employee feels their tax code is incorrect they should contact HMRC directly to discuss the matter.
Ask your employee to complete a HMRC New Starter Checklist. This will enable you to allocate the correct tax code to them. The link below will take you to the form on the Gov.uk website
https://www.gov.uk/government/publications/paye-starter-checklist
