Your P60 is the single best record of a year's British pay and tax. It is also the easiest document to misuse on an American return. The figures are right; the year they cover is the problem.
A P60 follows the UK tax year, from 6 April to 5 April. Your US return follows the calendar year. So the summary totals cannot go straight onto a 1040. This guide explains what each figure means and how to use it on both returns.
What is a P60?
It is your end-of-year summary from an employer, showing the pay you earned and the income tax deducted for one UK tax year. You get one for each job you hold on 5 April.
HMRC's guidance on the P60 states the core rule. If you work for an employer on 5 April, they must give you one by 31 May, on paper or electronically.
Keep every P60 you receive. It proves the tax you paid, which matters for refunds, loans and mortgages. For Americans it matters for one more reason: the US return.
It arrives once a year, around the end of May, and it is the first document to reach for when either return starts.
What does each figure mean?
The main figures are your pay for the year and the income tax deducted from it. You will also see National Insurance contributions, your tax code, and your National Insurance number.
Pay on a P60 usually means taxable pay after certain deductions, such as some pension contributions. So the summary pay figure can sit below your contractual salary. That difference matters on the American side.
Your final tax code shows how HMRC treated your allowances. Our guide to tax codes on GOV.UK explains what the letters and numbers mean.
Look out for student loan deductions too, where they apply. They reduce your take-home pay but not your taxable pay, so they do not change either return's income figure.
| P60 figure | What it shows | US return use |
|---|---|---|
| Pay | Taxable pay for the UK tax year | Rebuild by calendar year from payslips |
| Tax deducted | Income tax paid through PAYE | Supports foreign tax credits, matched by year |
| National Insurance | Class 1 contributions | A social security charge, not income tax |
| Tax code | How allowances applied | Useful context, not a US figure |
| Employer details | Who paid you | Identifies the source of foreign wages |
Why can't the figures go straight onto a US return?
Because the P60 covers 6 April to 5 April, while the US return covers 1 January to 31 December. So a singlesummary holds pay from two calendar years. Using its totals puts some of your income in the wrong American year.
The fix is simple arithmetic. Add up your payslips for each calendar year instead, then convert those totals to dollars. Your P60 then acts as a check that the monthly figures add up correctly.
The two calendars never line up, so every employed American in Britain meets this mismatch. The P60 is simply where it shows up first.
Weekly pay adds a small wrinkle, since some years contain an extra pay date. Payslips capture that automatically, which is another reason to rebuild from them.
How does the tax figure support your credit?
The income tax on your P60 is British tax on your salary. On the US return, that tax can offset the American tax on the same income through Form 1116.
The same calendar issue applies. The tax needs matching to the American year of the pay it relates to, so payslips again do the work. Our guide to avoiding double taxation covers how credits fit the wider return.
National Insurance on the P60 normally stays out of the credit. It is a social security charge, and the American side handles it through the social security agreement instead.
Keep the credit workings with the year-end summary itself. When the credit carries forward, you will want to see where each figure came from.
Which exchange rate should you use?
The US return needs dollars, so every sterling figure needs converting before it goes on a form. Many filers use the IRS yearly average rates for regular salary, applied consistently across the year.
One-off payments can justify a rate for the specific date instead. Either way, consistency matters more than precision. Pick a method, apply it to every figure, and keep the workings.
In our practice we see mixed methods cause more questions than any single choice. One method, recorded once, keeps both years tidy.
Whatever you choose, write it down beside the figures. Next year's return should follow the same method unless you have a reason to change.
Using the figures on both returns, step by step
This routine works for most employed Americans in Britain. It takes an evening once the payslips are to hand.
Store the finished workings with both returns. Next year starts from them.
Set aside an evening for it once the summary arrives in late spring. The work gets harder the longer the payslips sit unsorted.
- Collect your P60 for each job held on 5 April, plus every payslip.
- Check the payslips add up to the P60 totals for the UK tax year.
- Use the P60 figures for Self Assessment where you need to file one.
- Rebuild pay and tax by calendar year from the payslips for the US return.
- Convert those figures to dollars using one consistent method.
- Claim foreign tax credits for British tax, matched to the right American year.
What if you changed jobs or left?
Each employer you work for on 5 April gives you a P60. If you left a job before then, you get a P45 instead, showing pay and tax to your leaving date.
So a year with a job change may leave you with a P45 from one employer and a P60 from another. Both feed the same returns, and the payslips still do the calendar split.
If you left Britain mid-year, the residence rules and split-year treatment join the picture. Our guide to the statutory residence test covers that stage.
Check that the leaving document and the new employer's records agree about pay and tax to date. A gap between them usually means a tax code needs correcting.
How does a P60 differ from a P45 and P11D?
Each covers a different moment. A P60 summarises a full year with one employer, a P45 shows pay and tax up to the date you leave a job, and a P11D records taxable benefits such as a company car or medical cover.
All three can matter for an American's returns. Benefits in kind can be taxable on both sides, though each system values them its own way. So keep every form, not just the year-end summary.
If your employer provides benefits, ask when the benefits form will arrive. It often comes separately from the pay summary, and it feeds the same two returns.
An illustrative example
Take an illustrative example: an American nurse in Manchester who receives her P60 in May. It shows a full year's pay and tax from 6 April to 5 April. She plans to copy the totals onto her US return.
Her payslips tell a different story. Nine months of that pay fall in one calendar year and three in the next. So she rebuilds each calendar year from payslips, converts them, and uses the P60 only as a check.
Her British tax then supports her foreign tax credits, matched to each calendar year. Her American bill stays at nil, and both returns agree about the same income.
Her flatmate, paid weekly, has the same issue with one twist: a year with an extra pay date. Rebuilding from payslips handles that without any special effort.
Common mistakes with year-end forms
The first is copying P60 totals onto the 1040. The years do not match, so the income lands partly in the wrong year. It usually looks fine until two returns get compared.
The second is crediting National Insurance as income tax. It normally does not support a foreign tax credit, so including it overstates the relief.
The third is losing payslips. Without them, the calendar split becomes guesswork. Keep monthly records, since the P60 alone cannot be taken apart later.
A fourth is ignoring benefits. Taxable benefits sit on a separate form, and they can matter on both returns even when the pay summary looks complete.
What if the figures look wrong?
Ask your employer first, since they produced the figures and can correct their payroll records. Then check your personal tax account online, which shows what HMRC holds. Mismatches usually trace back to a code change or a missed adjustment.
If you paid too much, the year-end summary helps you claim it back, as HMRC's guidance notes. Keep the correspondence with the rest of the year's papers.
Fix British errors before finishing the American return. Otherwise the credit claim rests on figures that may still change, and both returns then need revisiting.
Where else the P60 helps
Beyond the returns, the P60 proves your income for loans and mortgages. It also helps if you think you overpaid tax, since it shows exactly what PAYE collected.
It also connects to the wider data picture. HMRC already holds your payroll figures from your employer, which our piece on how HMRC knows about your income explains.
So treat each P60 as a permanent record. Scan it, file it with the year's returns, and keep it for as long as the years stay open.
Lenders often ask for the two most recent years. Keeping them together in one place saves a scramble when you remortgage or apply for credit.
Checking your year-end summary each May
Make a habit of checking it the week it arrives. Compare the pay and tax against your last payslip of the year, since the two should agree.
Then file it with that year's records, beside the payslips that rebuild the calendar-year figures. A single folder per year keeps both returns simple.
Families who do this every May rarely meet surprises later. The work takes minutes while the year is fresh, and hours once it is not.
If the figures and payslips disagree, raise it with payroll straight away. Corrections are far easier in June than after both returns have gone in.
How US UK Tax Hub helps
We turn your P60 and payslips into both returns, through our treaty relief service. Pay gets split by calendar year, converted consistently, and matched to the right credits. The two returns then tell one story.
If you have been copying P60 totals onto your US return, the open years are worth a check. Send us the outline and we will review them at a fixed fee agreed first. Our guide to filing from the UK covers the wider return. This article is general information, not personal tax advice; take advice on your own facts from a qualified US-UK adviser.