UK tax codes explained.

What every letter and number on your payslip actually means — and how to tell if yours is wrong.

How UK tax codes actually work

Your tax code is HMRC's instruction to your employer about how much tax to deduct from each pay packet. It's a short string of numbers and letters — usually four characters in total — that captures three things: how much you can earn tax-free, the rate at which the rest should be taxed, and any adjustments for benefits, multiple jobs, or back-tax owed.

Every code follows the same structure. The number (which can be one to four digits, sometimes prefixed with S or C) represents your tax-free Personal Allowance divided by ten. So 1257 means £12,570 of tax-free pay per year. The letter (or letters) at the end describe how the allowance is applied — full, half, transferred, or removed altogether.

HMRC works out your code based on what they know about you: salary, benefits in kind, untaxed income from elsewhere, and whether you've recently had a tax-code adjustment to clear underpaid or overpaid tax from previous years. The full calculation appears on your annual P2 tax code notice, which you can also view at any time in your Personal Tax Account.

The standard code: 1257L

If you're an employee with one job, no taxable benefits, and no unpaid tax from previous years, your code is almost certainly 1257L. This has been the default UK tax code since the 2021/22 tax year, and the Personal Allowance has been frozen at £12,570 ever since — currently scheduled to remain frozen until April 2031.

Here's what each part means:

• 1257 — your tax-free Personal Allowance is £12,570 per year (multiply the number by 10).
• L — you're entitled to the standard, full Personal Allowance and your code applies cumulatively across the tax year.

Cumulative means your tax is calculated on your year-to-date pay rather than each pay period in isolation. If you earn nothing in April but £30,000 in May, the cumulative code knows to give you four months of unused allowance against May's tax bill — so you don't get hit with a huge deduction.

To see what 1257L actually delivers as take-home pay at different salaries, our salary calculator shows exact figures for every band.

What each letter suffix means

The letter at the end of your code modifies how the allowance is applied. Here's every common letter and what it tells you:

BR, D0, D1, 0T — codes with no Personal Allowance

Some codes ignore the Personal Allowance altogether. They're typically used when HMRC knows your allowance is already being used elsewhere — for example, against a different job or pension.

BR — Basic Rate

All income from this source is taxed at 20%, with no Personal Allowance applied. BR codes are most often used for second jobs, where your main income already uses up your full £12,570 allowance. They're also occasionally used on small pensions if you have a separate main job.

D0 — Higher Rate

All income is taxed at 40%. Used when you have multiple income sources and your other income already exceeds the higher-rate threshold (£50,270 in 2026/27). If you're earning above this in your main job and take on a second income source, HMRC may apply D0 to the second one.

D1 — Additional Rate

All income is taxed at 45%. Same logic as D0 but for very high earners — anyone whose other income is already above £125,140.

0T — No Allowance, normal bands

This one is more nuanced. 0T applies the standard tax bands but ignores your Personal Allowance entirely. So you'd pay 20% on your first £37,700 of pay (the basic rate band), 40% above that, and so on — but with no tax-free portion at all. 0T is often applied in unusual situations like emergency leaver pay or a redundancy payment without a P45.

K codes — when HMRC adds to your taxable pay

K codes work in reverse. Instead of subtracting tax-free pay from your salary, your employer adds a deemed extra amount to your pay before calculating tax. The number after the K is the additional taxable amount, divided by ten — so a code of K475 means £4,750 is added to your taxable pay each year.

K codes typically arise when:

• The taxable value of your benefits in kind (company car, fuel, medical insurance, accommodation) exceeds your Personal Allowance
• You owe tax from a previous year that HMRC is collecting through PAYE
• You receive untaxed income — like rental property income or state pension — that exceeds your allowance
• Your full Personal Allowance has been transferred via Marriage Allowance and you also have other adjustments

There is one safety net for K codes: by law, your employer cannot deduct more than 50% of your gross pay in any single pay period because of a K code. If your code would otherwise produce a higher deduction, the balance is carried forward to future pay periods.

If you're surprised by a K code, log into your Personal Tax Account to see exactly what's driving it. If a benefit has been removed (e.g. you returned the company car) and your code hasn't updated, that's a quick fix HMRC will action.

Emergency tax codes (W1, M1, X)

An emergency code is a temporary measure used when HMRC doesn't yet have full information about your income — typically when you've started a new job and haven't given the employer a P45. They look like a normal code with one of three suffixes added: 1257L W1, 1257L M1, or 1257L X.

The suffix is what matters here. It tells your employer to apply the allowance non-cumulatively — treating each pay period as if it were the first of the tax year. That means you get exactly 1/52nd of your allowance against weekly pay (W1), 1/12th against monthly pay (M1), or pro rata against any other frequency (X).

The practical impact: if you started your new job in October but only got paid in November (so you've effectively had seven months of unused allowance), an emergency code wouldn't refund that unused portion. A cumulative code would. The result is usually that emergency codes over-deduct tax in the first few months of a new job.

The fix is automatic: HMRC normally moves you to a cumulative code as soon as they receive your year-to-date earnings information from your previous employer (the P45) or from your new employer's first FPS submission. You'll then get an automatic refund of any over-paid tax in your next pay packet.

Scottish (S) and Welsh (C) prefixes

If you live in Scotland or Wales as your main residence, your tax code is prefixed with S or C respectively. The rest of the code works the same way — so a Scottish taxpayer with a standard allowance has code S1257L, and a Welsh equivalent is C1257L.

The prefix tells your employer to apply the devolved tax rates rather than the rest-of-UK rates. Scotland has six income tax bands (Starter 19%, Basic 20%, Intermediate 21%, Higher 42%, Advanced 45%, Top 48%) and the band thresholds for 2026/27 were raised at the bottom (Starter and Basic rate bands grew by 40% and 14% respectively per the January 2026 Scottish Budget). Wales currently uses the same rates as England and Northern Ireland — but the prefix is in place in case Welsh rates ever diverge.

Your prefix is determined by where you live, not where your employer is based. If you move between Scotland and the rest of the UK, you should update your address with HMRC and your code will be adjusted automatically — usually within a single pay cycle.

NT — the rare "no tax" code

NT stands for No Tax. It's exactly what it sounds like: no income tax should be deducted from this pay source. NT codes are uncommon, but they exist for specific situations:

• Certain overseas employees who are taxed in another country under a double-taxation agreement
• Some self-employed individuals who run payments through PAYE but settle their tax via Self Assessment
• Specific employment types like seafarers' earnings deduction cases

If you've been given an NT code and aren't sure why, contact HMRC. National Insurance is still deducted as normal — NT only affects income tax.

How to check your tax code is right

The fastest, free check takes about three minutes:

1. Log in to your Personal Tax Account at gov.uk (you'll need a Government Gateway ID — free to set up)
2. Click "Check your Income Tax for the current year"
3. Review your tax code and the breakdown of how it was calculated

Compare what HMRC has on file against reality:

• Is your job title and salary right?
• Are any taxable benefits listed (company car, fuel, medical insurance) accurate? Have you returned the car? Cancelled the medical insurance?
• Is your address correct? (This determines whether you get a Scottish/Welsh prefix.)
• Are there any "estimated other income" entries that don't reflect your situation?
• Is HMRC trying to recover tax from a previous year? Was that genuinely under-paid?

You can also see your code on your latest payslip and on any P2 tax code notice HMRC has posted to you (usually around February-March each year, before the new tax year starts).

How to fix a wrong tax code

If something is wrong, the route to fix it depends on what the issue is:

Wrong benefits (e.g. company car you no longer have)

Update via your Personal Tax Account → "Update or remove company benefits". HMRC reissues your code within a few days and the change shows up in your next pay cycle.

Multiple jobs incorrectly handled

If your second job is being taxed at BR but it shouldn't be (e.g. your main job's salary is well below the Personal Allowance), call HMRC's tax helpline on 0300 200 3300 and ask them to split your allowance between the two jobs.

Emergency code that hasn't been resolved

Most emergency codes self-resolve once HMRC receives your year-to-date data. If you're still on an emergency code more than 2-3 months into a new job, give HMRC a call — they can apply the cumulative code manually.

K code you don't understand

Log in to your Personal Tax Account and click into the K code breakdown. If it shows benefits or untaxed income that aren't yours, contact HMRC with evidence (e.g. proof you returned a company car, or that an old rental property has been sold).

Common questions