Payroll Forms: Payslips & P45

Payslip Requirements

Employers must provide info on gross pay, deductions, net pay, and the number of hours/pay periods the payment relates to.

Definition of Gross Pay

The amount an employee has earned before any deductions such as tax, national insurance, and pension contributions.

Definition of Net Pay

Often called 'take home pay,' this is the amount actually paid to the employee after all necessary deductions are made.

P45 Form

A document issued by law when an employee leaves employment, summarizing their pay to date in the current tax year.

P45 Part 1A

The specific copy of the P45 form provided to the employee for their own records.

P45 Part 2

The specific copy of the P45 form that the employee provides to their new employer.

P45 Part 3

The section of the P45 form that is completed by the new employer upon hiring.

Starter Checklist

Used by an employer to gather info like personal details and NI number if a new employee does not have a P45.

Payslip Hour Expression

Hours are expressed relative to the pay period; e.g., a monthly salary might be shown as 1, while a 4-weekly salary is shown as 4.

Statutory Deductions

Deductions like PAYE and National Insurance Contributions (NICs) that an employer makes without needing specific employee permission.

Non-Statutory Deductions

Optional deductions such as union fees or charitable giving that require employee permission to be taken from gross pay.

Payroll Software Design

While payslips have legal content requirements, the specific physical design is often determined by the software being used.

P60 Form

A form issued at the end of the tax year detailing total pay, taxable pay, PAYE, and NICs deducted for that year.

Taxable Pay

The adjusted figure derived from gross pay after subtracting items like pension contributions and payroll giving, used to calculate tax.

P11D Form

A form used to tell HMRC about any benefits in kind an employee has received, such as a company car or gym membership.

P11D (b) Form

A summary form of all individual P11D forms issued by an employer during a specific tax year.

Real Time Information (RTI)

The online process used to transmit employee payment and deduction data to HMRC via computerised software.

Full Payment Submission (FPS)

A payroll submission sent to HMRC on or before payday detailing employee payments and deductions.

Employer Payment Summary (EPS)

A submission sent by the 19th of the month to claim back amounts like maternity/paternity pay from HMRC.

HMRC Starter Checklist Data

Information gathered includes personal details, National Insurance number, start date, and student loan status.