An employees tax code may change during the tax year. A notification is usually sent to you from HMRC to inform you when a tax code has changed. This is a P6 or P9 notification. This usually happens when
- An employee's tax-free income (Personal Allowance) goes up or down, for example they start or stop receiving a taxable benefit like a company car.
- A new employee has provided a P46, and HMRC inform you of the correct tax code.
- You are sent new tax codes for your employees at the beginning of the tax year (P9X or P9T)
A P6 is issued by HM Revenue & Customs (HMRC) to employers to provide details of an employee’s tax code and previous pay and tax.
If you receive a P6, check or change the employee’s tax code and then, if applicable, enter any previous pay and tax.
A P9 is issued by HMRC to employers to inform you when an employees tax code has changed.
There are two different P9 forms:
- P9T is an individual tax code change
- P9X is a general tax code change and can apply to more than one employee.
If you receive a P9, update the tax code your employee records. Enter both P9 types in the same way.
When one of your employees’ tax codes changes:
- HMRC will send you one of the following:
- A paper form P9(T), ‘Notice to employer of employee’s tax code’
A internet notification if you’re registered to use our PAYE Online – internet service.To access your online tax codes notices
- Go to www.gov.uk/paye-online-log-in and
- From the Business tax account home page, select Messages and then select PAYE for employers messages.
- Select View your Tax Code Notices.
- Check if your employee’s previous pay and tax are included with the new tax code. If they are, note these figures.
- Update your employees record in Payroll with their new tax code as soon as possible and ideally before their next pay run.
Change an employee’s tax code
- Go to Employees, then click on the relevant employee to open their record.
- Click Edit.
- Under Current Tax Details, enter the new Tax Code if applicable.
- If required, select or clear the Week1/Month1 check box.
- Click Save.
Enter Employees previous pay and tax
If a new employee , previously provided a P46, you may receive a notification from HMRC to inform you of their new tax code. In this case, you also need to enter details of previous pay and tax.
From the Previous Tax details section, choose Employee declaration P45.
From the Circumstances list, choose one of the following options:
A Select this declaration if this is the employee’s first job since the last 6 April, and they have not been receiving taxable Jobseeker’s Allowance, Employment and Support Allowance, taxable Incapacity Benefit, or a state or occupational pension. B Select this declaration if this is the employee’s only job, but since last 6 April they have had another job, or has received taxable Jobseeker’s Allowance, Employment and Support Allowance, or taxable Incapacity Benefit. This option also declares that the employee does not receive a state or occupational pension. C Select this declaration if the employee also currently has another job, or receives a state or occupational pension.
- In the Tax Code box, enter the tax code from the P6 or P9.
- In the Leaving Date box, enter the date on which the employee finished their previous employment.
- Clear or select the Week1/Month1 check box. If you select this check box, skip to step 12.
- In the Final Pay Period list, enter the week or month of the employee’s final pay run in their previous employment.
- In the Total Pay To Date box, enter the previous pay value from the P6 or P9.
- In the Total Pay To Date box, enter the previous tax value from the P6 or P9
- Click Save.
Next time you process this employee’s payments, the tax due is calculated using the employee’s new tax code and, if the tax code is cumulative, the tax year values to date.