Telling HMRC you've left: the P85 and what else to do

What the P85 actually does

When you leave UK employment, PAYE doesn’t automatically know you’ve gone. HMRC’s system assumes you’ll keep earning at the same rate for the rest of the tax year and calculates your tax accordingly. If you stop working mid-year, you’ve almost certainly overpaid.

The P85, “Leaving the UK: getting your tax right”, is the form that corrects this. It notifies HMRC that you’ve stopped working in the UK, triggers a recalculation of what you actually owed for the year, and releases any refund due. It also closes your PAYE record.

You file it online through your Government Gateway account. You’ll need your P45 from your last UK employer. If you never received a P45, HMRC can work from your NI number and payroll details.

The bigger picture: the P85 is not your tax exit

This is the point most people miss. Filing a P85 is an administrative step. It does not make you non-resident. It does not end your UK tax liability on investment income, rental income, or capital gains.

Your tax residence status is determined by the Statutory Residence Test (SRT). The SRT looks at how many days you spend in the UK each tax year, how many UK ties you have (family, property, employment, past residence), and in which direction you’re travelling (arriving or leaving). It’s a structured test with a specific outcome: resident or not resident.

If the SRT says you’re still UK resident for a given year, because you came back too many times, or because you kept a UK home, then UK tax follows, regardless of what’s in your P85.

Self Assessment: the final return

If you were in Self Assessment before you left (rental income, self-employment, dividends, a directorship, higher-rate employment), a P85 alone isn’t enough.

You need to file a final Self Assessment return for the tax year you left. On that return, you claim split-year treatment under the SRT rules. This divides the year into two parts: a UK-resident period (taxed on worldwide income) and an overseas period (taxed only on UK-source income). Getting this right matters, because applying it incorrectly can leave you over-paying or, worse, under-declaring.

There are several different “cases” of split-year treatment in the legislation, and which one applies to you depends on your specific circumstances. This is not a form-filling exercise; it’s a tax analysis.

What to do about your National Insurance record

Leaving the UK breaks your NI contribution record. That can affect your UK State Pension entitlement, which requires 35 qualifying years for the full amount.

Many people who move to the UAE choose to pay voluntary Class 2 or Class 3 NI contributions to keep the record going. Class 2 is significantly cheaper and is available if you were employed or self-employed in the UK before leaving. It’s worth checking your State Pension forecast on the Government Gateway before you go so you know exactly where you stand.

The common mistakes

A few things people get wrong, in roughly the order we see them:

• Filing the P85 and assuming that’s job done
• Not filing a final Self Assessment return when they should have
• Returning to the UK too frequently in the first tax year after leaving, without tracking their days properly
• Keeping a UK property available for their use without understanding what that does to their SRT position
• Missing the Self Assessment filing deadline for the departure year (31 January following the tax year end)

The day-count point is worth underlining. The SRT has some strict thresholds, and the difference between 15 days and 16 days in a UK home can change your residence status entirely. Use a day-count tracker and keep the records.

A note on timing

The UK tax year runs 6 April to 5 April. If you left partway through a year, your split-year claim covers that year. If you’ve now been abroad for a full tax year without filing, HMRC may still have you on record as a UK taxpayer and may be expecting returns. It’s worth checking your Government Gateway account to see what’s showing.

Already left the UK and not sure you did it cleanly? The Clean Break Review gives you a clear read on your UK tax position, reviewed by a UK-registered tax adviser.