Taxation of employees - Important notes

In our experience, unfortunately, there are more and more disputes between employees and their employers. Below, you can find an outline of areas which we believe are most commonly problematic. Paying attention to these may be useful to avoid future issues.
This section is not intended to provide all the details of each point in the list, however, once you read through the “employee” page, you will have a better understanding of which areas are most important. 

So, what should be paid attention to:

  • Have a written contract, if possible. Even if you have no official contract, make sure to have a document that includes the main conditions of work.
  • Make sure to read the contents of the contract carefully before signing. Pay special attention to clarifying the most sensitive areas, such as holidays, sick leave, maternity leave, notice period.
  • At the start of employment, hand over the appropriate sheets of document P45 to your employer. Do keep the necessary sheets of the document, since you will need them later for verifying income.
  • If you do not have a P45, request a Starter Checklist. This will, theoretically, ensure that you are placed in the correct tax code.
  • Take your payslip on payday. Even if a payslip does not serve as legally accepted proof in all cases, handing it over means that the employer in a way acknowledges deducting tax and national insurance, and thus paying those amounts to tax authorities.
  • Check if all data on the payslip is correct. With the help of your payslip, you can ascertain that the correct tax code was applied, and if all necessary data and information is in there.
  • After the end of the tax year, make sure to take document P60. Employers need to issue these documents after the end of the tax year, not later than the 31st of May.
  • When quitting your job, make sure to request document P45. You should receive it 4-5 weeks (the latest) after leaving.
  • In all cases, make sure to check if the data on the documents is correct. Check if you agree with the amounts mentioned in the documents, and if your personal details are correct.