TaxHelper

UK tax codes explained

Your tax code tells your employer how much income tax to deduct from your pay each month. Getting it wrong costs you money - either too much deducted now, or a surprise bill later. Here is everything you need to know.

Analyse my code Why is my tax high?

Analyse your tax code

Type your code exactly as it appears on your payslip or P60.

How to read your tax code

The number

Multiply by 10 to get your approximate tax-free Personal Allowance for the year. So "1257" means £12,570 tax-free.

The letter

"L" is standard. "M" means you receive Marriage Allowance from your partner. "N" means you have transferred Marriage Allowance to your partner. "T" means HMRC needs to review your code.

W1 or M1 suffix

Week 1 or Month 1 basis - non-cumulative. Tax is calculated as if each pay period is the first of the year. Usually temporary.

K prefix

A K code works in reverse - the number represents the amount added to your income before tax, not subtracted. £200 extra tax-equivalent income per year for K20.

Example: 1257L

1257 = £12,570 tax-free allowance per year. L = standard allowance, no special circumstances. You pay income tax only on earnings above £12,570.

Example: K497

K = negative allowance. 497 = £4,970 is added to your income before tax is calculated. This happens when benefits in kind or underpayment collection exceed your Personal Allowance.

Types of tax code at a glance

1257LStandard code

The most common code. You get the full Personal Allowance of £12,570.

W1 / M1Emergency suffix

Non-cumulative. Tax is calculated fresh each week or month — common in a new job without a P45.

BRBasic rate only

All income taxed at 20%. Usually applied to a second job or pension where the allowance is used elsewhere.

D0 / D1Higher / additional rate

All income taxed at 40% (D0) or 45% (D1). Used for second sources of income in higher rate bands.

0TNo allowance

No Personal Allowance — every pound is taxed. Applied when no starter information is available or allowance is fully used.

NTNo tax

No tax deducted at all. Rare — used for specific exempt situations.

K codesNegative allowance

Your deductions (benefits in kind, prior underpayments) exceed your Personal Allowance — extra tax is added to each payment.

S prefixScotland

Scottish income tax rates apply. E.g. S1257L means the same allowance but Scottish bands.

C prefixWales

Welsh income tax rates apply. Otherwise works the same as the equivalent England/NI code.

Signs your tax code might be wrong

Any of these ring a bell?

Your code is lower than 1257L and you have no obvious benefits in kind

You see W1 or M1 after the number and you have been at the job more than a month

Your code is BR but this is your main and only job

You receive a P800 letter showing you significantly overpaid

You switched jobs and your new employer never received your P45

Diagnose my tax Claim a refund

How to correct a wrong tax code

1

Check your Personal Tax Account

Sign in at gov.uk and go to 'Check your tax code'. HMRC shows a full breakdown of why your code is what it is — including any benefits in kind, Marriage Allowance, or prior year adjustments.

2

Update incorrect information online

If a benefit in kind has ended, your income estimate is wrong, or a marriage allowance transfer is missing, you can correct most of these directly in your Personal Tax Account without calling.

3

Call HMRC if needed

For anything that cannot be fixed online, call the Income Tax helpline on 0300 200 3300 (Monday to Friday, 8am to 6pm). Have your National Insurance number and P60 ready.

4

HMRC issues a new coding notice

Once corrected, HMRC sends a P2 coding notice to you and your employer. Your employer updates the code from the next payroll run. Any overpaid tax from earlier in the year is refunded automatically through your payslip.