A contractors guide: Forms P60, P11D, P35
Regardless of how you choose to operate, there are several forms contractors will receive, or be asked to fill in and submit to Her Majesty’s Revenue & Customs (HMRC), each and every tax year. Here we’ve given you a brief guide to each of the main ones but you can find out more detail direct from the HMRC website by clicking here.
The P60 is a statement of how much PAYE tax and National Insurance has been paid during the year. This is issued by your employer (Personal Service Company, umbrella company or the agency) by 31st May each year.
If your employer doesn’t give you a P60 by 31st May, ask for it. You’re entitled to it by law if you are still working for your employer at 5 April and, as a contractor, you might need it in order to:
- Complete a Self Assessment Tax Return
- Claim back overpaid tax
- To apply for tax credits
It’s important that you keep your P60 safe as you might also need it as proof of income if you are applying for a loan or mortgage for example.
If you are a contractor running your own limited company, you will be a director and may need to complete a P11D Return of Expenses, Payments and Benefits form annually. This is to ensure that you are taxed correctly on any benefits you receive or expenses incurred as a result of the day to day running of your business.
As a director, you are obligated to calculate the cash equivalents of benefits and report these details to HMRC by 6 July following the end of a tax year (ending 5 April). It is estimated that 5 million P11Ds are submitted to HMRC annually and it has been known to impose stiff penalties on those who miss this deadline.
If you are contracting via an umbrella company such as Parasol then you are not required to submit a P11D.
The P35 is the end of year tax return completed by all employers. This form details the total tax and NI deducted for each employee during the previous tax year and it is submitted to HMRC by 19th May each year.
Parasol submits a P35 on behalf of all our employees every year.