When UK employees end their employment or are terminated, the employer needs to produce a P45, Part 1A (Details of employee leaving work - Copy for employee), Part 2 (Details of employee leaving work - Copy for new employer), and Part 3 (New employee details - For completion by new employer) on their last day of employment or as soon as possible after that date. The P45 is used by future employers when hiring to determine the correct tax codes for their new employees.
A P45 is typically produced in the pay period that includes the employee’s actual leave date. Details required on the P45 include the following:
- Employer information required:
- PAYE Reference number
- Name and address
- Employee information required:
- Name
- Address
- Employee number
- Gender
- Date of Birth
- Tax code
- National Insurance Number
- Tax week or month last paid (or at leaving date)
- Leaving date
- Total Taxable Pay to-date
- Total Tax to-date
- Total Taxable Pay for the duration of employment
- Total Tax for the duration of employment
- Student Loan indicator
- Date produced
You can generate a P45 in Payroll > Pay Run Management in a loaded pay run in the P45 subtab.
When you click Add, it creates a new entry where you select the terminated employee in either the Employee Name or Employee No. drop-down list, one entry for each terminated employee. After you have added one or more terminated employees, you must save the entries you made before you generate the P45s.
When you have saved the entry, you can generate the P45 by clicking Generate, which queues the P45 Generation Job background job. When that background job has completed, you can view an employee’s P45 in the slide-out panel, as illustrated here:
The P45 is generated as a PDF file that can be printed from within the slide-out panel. If the employee's last name is more than 28 characters, the name is truncated at 28 characters in the form's Surname field.
Dayforce can be configured to automatically generate a P45 when an employee is terminated.