If you are starting your first job in the tax year, or perhaps you have not been provided with a P45 from your previous employer, the HMRC starter checklist will need to be completed.
What is the starter checklist?
The HMRC starter checklist is crucial for ensuring that your new employer has the necessary information to calculate and deduct taxes from your pay correctly.
Details that are collected for the starter checklist are:
- Personal details: name, address, date of birth, and National Insurance number.
- Employment start date
- Employment Status: if you have another job or are in receipt of benefits or state pension
- Student loan repayment status (if applicable)
On the form, there are three statements that you (the employee) will need to choose from. It is important that you choose the correct one as your choice will determine the tax code that will be allocated to you.
Statement A applies if it is your first job in the current tax year (since 6 April) and you have not been receiving taxable Jobseeker’s Allowance, Employment and Support Allowance, taxable Incapacity Benefit, State or Occupational Pensions.
If this box is ticked, a tax code of 1257L (2024-25) will be issued.
Statement B applies if this your only job, but you have had another job since 6 April and do not have a P45. It also applies if you have received taxable Jobseeker’s Allowance, Employment and Support Allowance or taxable Incapacity Benefit since 6 April.
If this box is ticked, it is likely that a tax code of 1257L Week 1/Month 1 will be applied.
Statement C applies if you have another job, and/or receive a state, workplace, or private pension.
If you tick statement C, you will be allocated either a BR or DO tax code which means all your income from this job will be taxed at 20% or 40%.
The HMRC starter checklist should be completed and submitted to HMRC as quickly as possible after the commencement of your new employment as this will ensure that the correct tax code and tax is deducted from your pay. This is particularly important in the case of statement B or C as you may end up having to pay additional tax until HMRC issue a revised tax code for your new employment.
Useful Links:
Starter checklist for PAYE – GOV.UK (www.gov.uk)
Starter checklist (publishing.service.gov.uk)
We are available to answer any of your questions, and so do get in touch with our Payroll team if there is anything we can help you with.
Disclaimer
The views expressed in this article are the personal views of the Author and other professionals may express different views. They may not be the views of Lambert Chapman LLP. The material in the article cannot and should not be considered as exhaustive. Professional advice should be sought in connection with any of the issues contained in the article and the implementation of any actions.