A P60 is one of those documents that most business owners have heard of, but not everyone is completely clear on what it actually does or what they are supposed to do with it. If you employ staff, this is something you need to get right every year — and there is a firm deadline attached.
So, what is a P60?
A P60 is a summary of an employee’s pay and deductions for the full tax year. It shows their total earnings, how much income tax was deducted, and how much National Insurance they paid — all between 6 April and 5 April the following year.
Every employee who is on your payroll on the last day of the tax year (5 April) must receive one. If someone left during the year, they do not get a P60 from you — they would have received a P45 when they left instead.
For employees, the P60 matters for all sorts of reasons. They may need it to complete a self-assessment tax return, apply for a mortgage, claim a tax refund, or simply check that they have been taxed correctly. It is the definitive record of their pay for the year.
What do employers need to do?
Your job as an employer is straightforward in principle. You need to produce a P60 for each qualifying employee and issue it to them. Here is what that involves in practice:
- Complete your final payroll submission of the tax year first. The P60 figures come from your payroll records, so everything needs to be accurate before the P60 is generated.
- Generate P60s through your payroll software. Most payroll systems will produce these automatically once the year-end process is complete.
- Issue them to employees by 31 May. This is the legal deadline. You have from the end of the tax year (5 April) until 31 May to get them out.
- You can issue P60s electronically or on paper — either is fine, as long as employees can access them.
The 31 May deadline
The deadline to issue P60s to employees is 31 May each year. This is not a guideline — it is a legal requirement under PAYE regulations.
That gives you roughly eight weeks from the end of the tax year on 5 April to get everything finalised and distributed. For most businesses running monthly payroll, that is plenty of time. For businesses running weekly payroll with a larger team, it pays to plan ahead.
What happens if you miss the deadline?
Missing the 31 May deadline puts you in breach of your PAYE obligations. HMRC can issue a penalty for late or missing P60s, and employees have every right to request them.
Beyond the compliance side, there are practical problems. Employees who need their P60 for a mortgage application or tax return will not be able to proceed without it. That creates stress for them and complaints for you.
If you realise you have missed the deadline, issue the P60 as quickly as possible and do not wait to be chased. Late is better than never, and dealing with it promptly shows good faith.
A few common questions
Does an employer need to keep a copy of the P60?
You do not have a legal obligation to keep a copy of the P60 itself, but you must keep the underlying payroll records that generated it — typically for at least three years.
What if an employee loses their P60?
You cannot issue a replacement P60 — once issued, it cannot be reissued with the same status. What you can provide is a statement of earnings, which serves the same practical purpose for most needs. Your payroll software should be able to generate this.
Does a director need a P60?
If a director is on the payroll and paid through PAYE, yes — they are entitled to a P60 just like any other employee.
Getting it right without the stress
P60s are not complicated in themselves, but they sit at the end of a year-end payroll process that has a lot of moving parts. Getting your final submission right, reconciling figures, and hitting the deadline all at once can pile up — especially if you are managing payroll on top of everything else that comes with running a business.
If you want the year-end process handled smoothly and on time every year, Lucas White Payroll Services can take care of it. Get in touch to find out how we work.
