Self Assessment Payslip Guide

Employees often approach HR or business owners when they receive a tax demand under the Self Assessment system, particularly if HMRC issues a Self Assessment payslip. Although the document resembles a payroll instrument, it is generated entirely by HMRC and relates solely to an individual’s personal tax liability. Employees frequently assume the employer is responsible for explaining or resolving the issue, which creates both practical and compliance considerations for HR professionals who must remain within strict limits on what they can lawfully advise.

What this article is about: This article explains what a Self Assessment payslip is, why HMRC issues it and what HR professionals and business owners need to understand when responding to employee queries. It clarifies the employer’s responsibilities under PAYE, including correct application of HMRC tax codes, RTI reporting requirements and record-keeping obligations. It also sets out how to handle situations where employees believe payroll has caused their tax bill, how Self Assessment interacts with tax codes, benefits, student loan deductions and director pay, and what support employers may give without crossing into regulated personal tax advice. The article reinforces that employers cannot contact HMRC on an employee’s behalf and must direct employees to HMRC for matters involving the tax calculation, payment deadlines or Time to Pay arrangements.

Section A: Understanding the Self Assessment Payslip

Employees often believe that anything labelled “payslip” must have been generated by their employer. In reality, the Self Assessment payslip is entirely an HMRC document used to collect a personal tax bill. HR professionals and business owners therefore need a clear understanding of what the payslip is, why employees receive it and how it interacts with payroll information, particularly when confronted with complaints or confusion about tax liabilities. It is also important to distinguish a Self Assessment payslip from HMRC’s “Simple Assessment”, which is a separate process where HMRC directly issues a tax calculation without requiring the individual to file a full return.

The Self Assessment payslip is issued by HMRC to individuals who must file a Self Assessment tax return. It accompanies the notice to pay and includes payment references, the amount due and accepted payment methods. Employees use it to pay any tax they owe after HMRC has calculated their liability from the return. There is no employer involvement in the production or distribution of this document.

HMRC issues a Self Assessment payslip when a return has been filed and shows that the individual owes additional tax on income not fully taxed through PAYE. This may include dividend income, rental income, benefit-related adjustments, untaxed earnings or liabilities created by incorrect or out-of-date tax codes. The payslip itself is not evidence of employer error; it is simply HMRC’s payment instrument.

To prevent confusion, employers should be aware of key differences between PAYE payslips and the Self Assessment payslip. A traditional payslip shows gross pay, deductions and net pay for a specific pay period. A Self Assessment payslip only shows the tax owed, the payment due date and a reference number. It contains no earnings information, tax codes or year-to-date figures. A Self Assessment payslip does not indicate that the employer has under-deducted PAYE unless HMRC separately issues a coding notice or correction.

When employees raise concerns about receiving a Self Assessment payslip, HR should explain its purpose while ensuring employees understand that the employer is not responsible for paying or administering the tax bill. As part of good practice, HR may remind employees that updating HMRC promptly when their circumstances change, such as starting or ending benefits or taking on additional work, reduces the risk of incorrect tax codes that later trigger Self Assessment underpayments.

Section Summary: This section explained what a Self Assessment payslip is, why HMRC issues it and how it differs from employer payslips. It clarified that the document is an HMRC payment instrument and not evidence of employer fault. HR’s role is limited to explaining the distinction and ensuring payroll records are accurate.

Section B: Employer Responsibilities and Boundaries

HR professionals and business owners are often the first point of contact when an employee receives a Self Assessment payslip. Many employees assume their employer controls their entire tax position, including anything sent by HMRC. This misunderstanding can draw HR into conversations that blur the line between payroll responsibilities and regulated personal tax advice. To remain compliant, employers must understand both their obligations and the limits of their involvement.

Employers are responsible for operating PAYE correctly, applying tax codes exactly as instructed by HMRC and maintaining accurate payroll records. These obligations include processing tax codes issued through form P6 (in-year changes), form P9 (start-of-year codes) and any relevant P6B notices. Employers must also ensure accurate RTI submissions, including Full Payment Submissions (FPS) and Employer Payment Summaries (EPS), and must retain payroll records for at least three years. Beyond these statutory duties, employers have no responsibility for an employee’s personal Self Assessment obligations. If an employee owes tax under Self Assessment, it is a matter strictly between the individual and HMRC.

Although employers are not responsible for an employee’s tax bill, they must handle related queries professionally. HR may help employees understand the difference between deductions made through PAYE and the personal tax reconciliations carried out by HMRC under the Self Assessment system. Employers may explain factual payroll processes but cannot intervene with HMRC or discuss the employee’s personal tax calculation. Employers must also avoid giving advice on allowable expenses, personal deductions or any matter that constitutes regulated tax advice.

A recurring issue is where an employee claims their tax bill was caused by payroll error. HR should not assume fault. Instead, review payroll records, ensure all coding notices were applied correctly and verify that RTI submissions were accurate. If payroll was operated correctly, HR can confirm there is no employer error. If a genuine mistake is identified, such as a coding notice being overlooked or incorrectly applied, the employer should correct the error using an FPS adjustment or EPS submission and advise the employee to contact HMRC, who will determine the effect on their Self Assessment liability.

Another common point of confusion is student loan and postgraduate loan deductions. Employers are legally required to operate these deductions when notified via SL1, SL2 or postgraduate loan start and stop notices. HR should clarify that deductions are made based solely on HMRC instructions and that queries about balances or loan overpayments must be directed to HMRC or the Student Loans Company.

Employees may also assume that employers can complete their Self Assessment return or contact HMRC on their behalf. Employers must not do either. HR may provide payroll documents such as payslips, P60s, P45s or benefits information but must direct employees to HMRC or a qualified adviser for any queries involving tax calculations, repayment plans or Time to Pay arrangements.

Section Summary: This section outlined what employers are and are not responsible for when employees receive a Self Assessment payslip. It confirmed the employer’s duty to operate PAYE correctly, apply tax codes precisely and maintain compliant RTI reporting, while emphasising that employers cannot contact HMRC or provide personal tax advice. HR may support employees by providing factual information and correcting payroll errors prospectively but must not become involved in their Self Assessment affairs.

Section C: Payroll, Tax Codes, and Self Assessment Interaction

Many employee concerns about receiving a Self Assessment payslip arise from misunderstanding how PAYE interacts with HMRC’s Self Assessment system. When an unexpected tax bill appears, employees often assume payroll under-deducted tax. HR must therefore understand the technical relationship between payroll operations, tax codes and HMRC assessments to respond accurately and maintain compliance.

Incorrect or outdated tax codes are a common reason employees incur a Self Assessment liability. HMRC issues tax codes based on information it holds about benefits in kind, earlier earnings, adjustments, deductions or estimated allowances. If HMRC’s estimates are incomplete or inaccurate, or if the employee does not notify HMRC of changes in circumstances, the tax code may under-collect tax. Provided the employer applied the code exactly as instructed through forms P6 or P9, the employer is not at fault. Responsibility for issuing correct tax codes lies with HMRC, not the employer.

When an employee claims their Self Assessment bill is caused by a payroll problem, HR should follow a structured approach. First, review the tax codes applied during the year and confirm their alignment with HMRC notices received, including any P6, P9 or P6B instructions. Second, check whether the payroll system correctly accounted for benefits in kind, either through payrolling benefits or through P11D reporting. Third, review RTI submissions for accuracy, ensuring Full Payment Submissions (FPS) and any Employer Payment Summary (EPS) filings were correct. This structured review helps establish whether payroll was operated properly or whether an error requires correction.

If an error is identified, employers must correct payroll prospectively and, where necessary, submit an FPS correction or EPS adjustment under RTI. HR should inform the employee that HMRC will recalculate their position, and any Self Assessment implications will be determined by HMRC, not by the employer. Employers cannot recalculate or negotiate the employee’s tax bill.

Employees may also question why HMRC did not collect any tax shortage through their tax code rather than issuing a Self Assessment bill. HR may explain that HMRC can “code out” underpayments of up to £3,000, but only where specific conditions are met and only if HMRC processes the adjustment in time. Coding out is entirely at HMRC’s discretion and does not involve the employer aside from applying the new code once issued.

Certain categories of employees are more likely to fall within the Self Assessment regime due to their income profile rather than anything related to payroll. These include individuals earning over £100,000, people with multiple employments, employees receiving significant income outside PAYE and some company directors. However, directors are not automatically required to file a Self Assessment return solely because of their role. HMRC assesses eligibility based on income sources, tax complexity and other statutory criteria.

Section Summary: This section explained how payroll accuracy, RTI reporting, tax codes and employee circumstances interact with the Self Assessment system. It provided a structured method for HR to review claims of payroll-related underpayments, clarified that employers must apply tax codes exactly as instructed and confirmed that many Self Assessment liabilities arise from personal income factors rather than payroll errors.

Section D: Supporting Employees Through the Self Assessment Process

When employees receive a Self Assessment payslip, many expect their employer to explain the reason for the bill or assist in completing the return. HR and business owners must understand how to provide appropriate support without crossing into regulated personal tax advice. The employer’s role is limited to supplying accurate payroll information, confirming how PAYE was operated and directing employees to HMRC for all questions concerning the tax calculation or payment arrangements.

The most practical support employers can provide is ensuring employees have access to all payroll documents relevant to Self Assessment. This includes payslips for the tax year, the P60 summarising annual taxable pay and deductions, and a P45 where employment has ended mid-year. If benefits in kind are provided, HR must ensure employees receive accurate P11D forms by 6 July following the end of the tax year unless the organisation uses payrolling of benefits. Employers must also pay Class 1A National Insurance on certain benefits by 22 July when paying electronically. Accurate and timely provision of these documents reduces the risk of discrepancies within the employee’s Self Assessment calculation.

HR may also outline the basic Self Assessment process without giving personal tax advice. This includes explaining that HMRC requires a return to be filed by 31 January following the end of the tax year, that tax owed must be paid by the same deadline and that some individuals may also have payments on account due on 31 January and 31 July. Employees must then pay the amount shown on their Self Assessment payslip using HMRC’s approved payment methods. HR should also direct employees to HMRC guidance if they wish to explore Time to Pay arrangements, as employers cannot discuss or negotiate payment plans on an employee’s behalf.

Employees frequently confuse employer payroll processes with the outcomes of Self Assessment. To minimise misunderstandings, HR may encourage employees to inform HMRC promptly of changes affecting their tax code, including changes to benefits, patterns of working or additional income sources. Proactive communication with HMRC helps prevent incorrect tax codes that later create Self Assessment underpayments.

If an employee believes their Self Assessment bill is incorrect, HR should avoid speculating about the accuracy of HMRC’s calculation. Instead, HR may review payroll data for accuracy, confirm that all HMRC notices were applied correctly and suggest the employee contacts HMRC for a detailed explanation. Employers cannot contact HMRC on an employee’s behalf and cannot advise on how the employee should complete their tax return or what deductions they may claim.

Section Summary: This section outlined how employers can support employees with Self Assessment queries while remaining compliant. It emphasised providing accurate payroll documents, maintaining clear boundaries regarding personal tax advice, directing employees to HMRC for all tax calculation matters and encouraging proactive updates to HMRC to minimise future issues.

FAQs

1. Do employees need payslips for their Self Assessment tax return?

Employees may use payslips to check specific earnings data, but the primary payroll documents required for completing a Self Assessment return are the P60 and, where employment ended mid-year, the P45. Payslips can help reconcile discrepancies but are not mandatory for the return itself.

2. What should HR do if an employee claims payroll caused their Self Assessment tax liability?

HR should review the tax codes applied during the year, check for HMRC coding notices and ensure payroll was operated correctly, including accurate RTI reporting. If payroll was compliant, the liability is a matter between the employee and HMRC. If an employer error is identified, the correction must be made through an FPS or EPS adjustment, and the employee should be directed to HMRC for further guidance.

3. Can employers correct historical payroll errors for Self Assessment purposes?

Employers can correct payroll errors prospectively or retrospectively through an FPS correction or EPS submission. HMRC may then adjust the employee’s tax code or Self Assessment calculation. Employers cannot determine the employee’s personal tax liability, as this remains within HMRC’s authority.

4. Does HMRC send Self Assessment payslips to employers?

No. HMRC sends all Self Assessment documentation directly to the individual. Employers do not receive copies and have no involvement in the payment process.

5. Can employers give employees advice on completing their tax return?

No. Employers must avoid regulated personal tax advice. HR may provide factual payroll documents and explain PAYE processes but must refer employees to HMRC or a qualified adviser for help completing their Self Assessment return or discussing deductions or expenses.

Conclusion

Self Assessment payslips often lead to confusion for employees, who may assume that any tax demand relates to how their employer has run payroll. In reality, the payslip is an HMRC document issued to collect an individual’s personal tax liability. Employers must therefore understand their own responsibilities, remain within legal boundaries and respond to employee queries in a clear, factual and compliant manner.

Accurate payroll operation remains the central responsibility for employers. Applying HMRC tax codes correctly, processing RTI submissions accurately, managing benefits in kind reporting and maintaining statutory records all help reduce misunderstandings about tax deductions. When employees raise concerns, HR should review payroll data, provide factual explanations and direct employees to HMRC for all matters related to tax calculations, returns, deadlines or payment arrangements.

Employers do not administer Self Assessment, cannot contact HMRC on an employee’s behalf and must not provide regulated tax advice. Instead, they support employees by ensuring that statutory payroll documents are issued correctly and on time, and by helping employees understand the distinction between PAYE deductions and HMRC’s Self Assessment process. With clear processes and communication in place, employers can manage expectations, support staff appropriately and maintain full compliance.

Glossary

Useful Links