What is a P45?
Definition of a P45
A P45 is a form that an employer must give to an employee who's leaving their job.
The P45 contains details of how much taxable salary the employee has been paid so far in that tax year, how much tax has been deducted from their wages, and what their final tax code was.
When the individual starts a new job, they must give a copy of the P45 to their new employer, so that the new employer deducts the right amount of tax from their wages for the rest of the tax year.
Before the introduction of RTI, a copy of the P45 had also to be sent to HMRC. Now, the employer only has to include a leaving date in their RTI submission in order to send this information to HMRC.
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FreeAgent's Chief Accountant Emily Coltman is available to answer your questions in the comments.