P45 & Emergency Tax

mro wrote: »

What happens if you don't give your last P45 to new employer in time for payroll run ?

How does it work on pay & tax ?

You should be invited to complete a new starter checklist which asks you to select A B or C....
A This is my first job since last 6 April and I have not been receiving taxable Jobseeker’s
Allowance, Employment and Support Allowance, taxable Incapacity Benefit,
State or Occupational Pension.
B This is now my only job but since last 6 April I have had another job, or received taxable
Jobseeker’s Allowance, Employment and Support Allowance or taxable Incapacity Benefit.
I do not receive a State or Occupational Pension.
C As well as my new job, I have another job or receive a State or Occupational Pension.

A You will be put on the emergency tax code of 1185L on a cumulative basis
B You will be put on the emergency tax code of 1185L on a week 1 month 1 basis.
c You will be put on a BR tax code ie 20% on all taxable pay
If you decline to fill this in you will be put onto 0T tax code. Similar to BR but with the possibility of paying some tax at rates above 20% depending on your earnings.

mro wrote: »

Yes, I filled in one of these questionnaires, I selected B.

My P45 shows my 'tax code at leaving date' was 1185L.


Is 1185L the emergency tax code, or is it BR or 0T ?

I thought Emergency Tax Code was when you paid standard tax on everything and could/would overpay tax.
.

Without seeing your P45 details I cannot say for certain but most probably your P45 was 1185L accumulative and would also have details of your taxable earnings to date and tax paid to date. This means that when your P45 is applied your tax paid will be correct and up to date.
The emergency tax code though the same as most peoples tax code is just a temporary tax code and any pay and tax from last employment are not known, so it is usually applied on a week by week or month by month basis.. This means that while on the emergency tax you may not be paying the correct amount of tax, you may be over-paying or under-paying, it is just a best guess of what most people are likely to be paying.
When a new starter checklist is completed HMRC will send full tax details to the employer so that any under or over taxing is corrected. If a P45 is handed in before then that will serve the same purpose.

1185L is the emergency tax code for this tax year.

The emergency tax is not designed to deduct extra tax it is the code that will tax most people something near to the correct tax; but some will pay more tax than they should and some will pay less tax than they should. Whatever the case it will correct itself when either the P45 is applied or HMRC advise full details to the employer.