The P45 form is an essential document used in the United Kingdom to record an employee's departure from a job. It is divided into three parts, each serving a distinct purpose for the employer, the employee, and the new employer. The first part, which is sent to HM Revenue & Customs (HMRC), includes critical information such as the employee's National Insurance number, tax code, and total pay and tax deducted during their employment. Employers must complete this section accurately and promptly to ensure compliance with tax regulations. The second part, retained by the employee, serves as proof of income and tax contributions, which may be necessary for future tax returns or claims for benefits. The third part is provided to the new employer, allowing them to set up the employee's tax and National Insurance contributions correctly. It is crucial for employees to keep their P45 safe, as it contains sensitive information that impacts their tax status. Overall, the P45 form plays a vital role in the employment lifecycle, facilitating a smooth transition between jobs while ensuring tax obligations are met.