Set yourself up as an employer

What if my new employee doesn't have a P45?

There are various reasons why a P45 may not be available, for example:

• the P45 has been lost
• this is your employee's first job
• your employee is continuing with their current job as well as working for you
• your employee is a student who is temporarily working for you during their holidays

In cases like these, you must use a form P46 - the only exception is if an employee is going to work for you for one week or less, and won't be working for you again in the future - call the HM Revenue & Customs New Employers Helpline on Tel 0845 60 70 143 for details.

Before you pay an employee, you must have either received a P45 or completed a P46.

Before you start
Make sure you have your New Employer's Starter Pack available. This contains blank P46 forms. The starter pack CD-Rom also includes the help book on day-to-day payroll - the section "A new employee doesn't give you a form P45" gives full details of what to do. See the page in this guide on the New Employer's Starter Pack.

The P46: your employee's statement

Download from P46 from the HR Revenue & Customs website (PDF).

Ask your employee to:

1. Read statements A, B and C, and tick each box that applies to them. This can be more than one box. If none of the statements apply - for example, if they are continuing to work for another employer - they shouldn't tick any of the boxes.
2. Sign and date section 1, if they've ticked any of the boxes.
3. Write their National Insurance (NI) number in section 2 - if the employee doesn't know their NI number, leave this box blank.

The P46: section 2
Now complete the rest of section 2. It's important to record the coding information correctly, so at this point you should call HM Revenue & Customs New Employers Helpline. As well as ensuring that the form is completed correctly, they'll tell you whether to keep the completed form or send it off to HM Revenue & Customs.

Record the employee's details
Use the details from the P46 to create a payroll record for the employee - this is the record you'll use when you come to calculate pay and deductions. See the page in this guide on choosing a payroll system.

Subjects covered in this guide

• Introduction
• Who counts as an "employee"?
• First steps in taking on a new employee
• The New Employer's Starter Pack
• Dealing with a new employee's P45
• What if my new employee doesn't have a P45?
• When a new employee doesn't have or know their NI number
• Choosing a payroll system
• Operating the payroll manually
• Using payroll software
• Arranging payment for your new employee
• Paying your employee for the first time