Employee gets a new tax code
If an employee's tax code changes during the tax year, we will send you a form P6 to notify you. Unless we specify otherwise, you should use this new tax code for all PAYE (Pay As You Earn) tax calculations from the first payment after you receive form P6.
Using the P11 Calculator
The P11 Calculator, contained on the Employer's CD-Rom, will automatically handle the transition between tax codes for you. When recording the first payment after receiving a form P6 from us, make sure to answer yes when asked 'Have you received a P6 coding notice since their last pay day?'
Using a paper form P11
Write the new tax code in Box L and use it to work out your PAYE tax deductions, whether manually or using our PAYE tax calculator.
Tax code changes to or from a cumulative basis require extra care if you're using a paper form P11 rather than the P11 Calculator. If the code changes:
- from a week 1/month 1 to a cumulative basis, you'll need to add up the pay and tax already paid so far in the tax year and use this as the basis for your cumulative calculations
- from a cumulative basis to a week 1/month 1 basis, you can disregard the previous pay and tax amounts that have accumulated so far in the tax year
If your employee's tax code changes from a K code (on a cumulative basis) to a suffix code (on a cumulative basis), consult Part 8 of Day-to-day payroll E13 for information about how to update the form P11.
Read our guide 'Day-to-day payroll (E13)'
How to complete form P11 using our Employer CD-Rom P11 calculator
