P45 slips saved from redundancy
HM Revenue and Customs decides to keep P45 forms after requests from employers
THE TAXMAN has decided not to scrap P45 slips after employers said they wanted to keep them.
HM Revenue and Customs (HMRC), which is modernising the Pay As You Earn system, had planned to replace the forms for when employees move jobs with a “leaver statement”.
Under plans for “real time” PAYE, employers will send information about tax and national insurance deducted from employees’ wages to HMRC when they are made – rather than at the end of the tax year as happens now.
A trial of the real-time information system starts in April.
Colin Ben-Nathan, chairman of the employment taxes sub-committee, at the Chartered Institute of Taxation, said the decision to keep P45s was “sensible”.
The removal of the requirement to provide a P45 may have confused employers, employees and even government itself, Ben-Nathan said.