Tax Codes Guide 2026/27

UK Tax Codes Explained

1257L, BR, 0T, K and emergency codes - what they mean and how to fix them.

Updated March 2026 · 10 min read · Money Meister · 15 min read

Your tax code is a tiny string of characters - usually something like 1257L - sitting quietly on your payslip every month. Most people ignore it completely. That is a costly mistake.

The wrong tax code can mean you overpay income tax for an entire year without realising it. HMRC estimates that millions of UK workers are on incorrect codes at any given time - overpaying hundreds or even thousands of pounds. The good news is that checking your code takes two minutes, fixing it takes five, and HMRC will refund everything you've overpaid.

This guide covers every type of UK tax code: how to decode the number and letter, what BR, D0, 0T, K and emergency codes mean, how Scottish and Welsh codes differ, common reasons your code might be wrong, and the exact steps to correct it. Use our UK tax calculator to enter your code and see how it affects your take-home pay.

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How to Read Any UK Tax Code

The vast majority of UK tax codes follow a simple two-part pattern: a number followed by a letter. Once you understand those two parts, you can decode almost any code you'll encounter.

Part 1: The Number - Your Personal Allowance

Take the number and multiply by 10. The result is your personal allowance - the amount of income you earn completely free of tax each year.

1257L → 1257 x 10 = £12,570 personal allowance

Everything you earn above £12,570 is taxed at the standard income tax rates.

For higher earners: if your income exceeds £100,000, HMRC reduces your personal allowance by £1 for every £2 above that threshold. At £125,140 the allowance reaches zero. This is why some people have a code like 500L (£5,000 allowance) or 0T (no allowance at all). Read our guide on the 60% tax trap if your income is approaching £100,000.

Part 2: The Letter - How to Apply the Allowance

The letter suffix tells HMRC and your employer which rules to apply on top of the number. Here are all the standard letters:

Letter	What it means
L	Standard personal allowance - the most common letter for most employees
M	Marriage Allowance - you've received 10% of your partner's personal allowance (adds ~£1,260 to your allowance)
N	Marriage Allowance - you've transferred 10% of your personal allowance to your partner
T	HMRC needs to review your tax code - often used when the personal allowance is being tapered above £100k
S	Scottish taxpayer - prefix (e.g. S1257L) indicating Scottish income tax rates apply
C	Welsh taxpayer - prefix (e.g. C1257L) indicating Welsh income tax rates apply

Special Flat-Rate Tax Codes

Some codes don't follow the number-letter pattern at all. Instead, they apply a fixed percentage to your entire income - often used for second jobs, pensions, or emergency situations. If you see any of these on your main job payslip, check with HMRC immediately.

Code	Tax rate applied	When you'll see it
BR	20% on all income	Second job or pension; no personal allowance. Common when you start work without a P45.
D0	40% on all income	Second income source when you're already a higher-rate taxpayer on your main job.
D1	45% on all income	Second income source for additional-rate (£125,140+) taxpayers.
NT	0% - no tax at all	Very rare. Used for non-UK residents, certain pension arrangements, or HMRC-agreed situations.

BR on your main job? This is a very common error. If BR appears on your only job and you have no other income, you're paying 20% tax on every single pound - including the first £12,570 that should be tax-free. At a £30,000 salary, that's over £2,500 you're overpaying. Contact HMRC or log into your Personal Tax Account immediately.

Emergency Tax Codes: 0T, W1 and M1

Emergency tax codes are temporary codes HMRC applies when they don't have enough information about your income - most often when you start a new job. They almost always result in you overpaying tax, which is refunded once HMRC resolves the situation.

0T - Zero Personal Allowance

The 0T code gives you absolutely no personal allowance. Tax is calculated on every pound of income using standard rate bands - 20%, 40%, 45% - from pound one. It's applied when HMRC has no starter information, when you've used up your allowance against other income, or when starting a new job without completing a starter checklist.

W1 and M1 - Non-Cumulative Basis

The W1 (Week 1) and M1 (Month 1) suffixes are added to another code, for example 1257L W1 or 0T M1. They instruct your employer to calculate tax on each pay period independently, as if it were the first week or month of the tax year - rather than cumulatively. This prevents large under- or overpayments when HMRC is mid-process on your records. These are temporary and generally resolve within a few payroll cycles once HMRC receives your employer's full submissions.

If you've been on an emergency code for more than two payslips, don't wait for it to self-correct. Use your HMRC Personal Tax Account to check your current tax code and trigger a correction.

K Codes - Negative Personal Allowance

K codes work in the opposite direction to standard codes. A code like K475 means HMRC adds £4,750 (475 x 10) to your taxable income before calculating tax - rather than deducting a personal allowance.

K codes arise when the value of untaxed benefits or income exceeds your personal allowance. Common causes include:

High-value company car or fuel benefit (often worth £5,000-£20,000+)
State pension or other state benefits that exceed your personal allowance
Underpaid tax from a previous year being collected through PAYE
Outstanding tax from a late self-assessment return

The 50% cap - an important protection

By law, your employer can never deduct more than 50% of your gross pay in income tax as a result of a K code. If the K code would cause deductions above 50%, HMRC carries the remainder forward to future months. You can review your K code breakdown in detail through your HMRC coding notice.

Scottish and Welsh Tax Codes

If you live in Scotland, your tax code will have an S prefix (e.g. S1257L). Scottish income tax operates five separate bands, compared to three for the rest of the UK:

Band	Income (2026/27)	Rate
Starter	£12,571 - £14,876	19%
Basic	£14,877 - £26,561	20%
Intermediate	£26,562 - £43,662	21%
Higher	£43,663 - £75,000	42%
Advanced	£75,001 - £125,140	45%
Top	Over £125,140	48%

Welsh taxpayers use a C prefix (e.g. C1257L). Welsh rates mirror the rest of the UK's standard rates but are technically set by the Welsh Government. If you've recently moved to or from either nation, update your address with HMRC to ensure the correct prefix is applied.

Tax Codes When You Have Multiple Jobs

Your personal allowance can only be applied to one income source at a time. If you have two jobs or a job and a pension, HMRC allocates your entire personal allowance to whichever is your primary income source. Your second income is then taxed from the first pound.

How it works in practice

Job 1:

Usually gets your full personal allowance via your standard code (e.g. 1257L). Tax is calculated normally - 0% on the first £12,570, then 20% above that.

Job 2:

Receives a BR, D0, or D1 code depending on your total income from Job 1. If Job 1 keeps you in the basic rate band, Job 2 gets BR (20% flat). If you're already a higher-rate taxpayer, Job 2 gets D0 (40% flat).

In some cases, especially if your second job pays very little, you can ask HMRC to split your personal allowance between employers - for example, 900L on Job 1 and 357L on Job 2. This reduces over-withholding but requires you to contact HMRC directly. See your options at gov.uk/tax-codes. You can also use our tax calculator to model different code combinations.

Most Common Reasons Your Tax Code Is Wrong

HMRC builds your tax code from the information it holds about you. If that information is incomplete, out of date, or based on incorrect estimates, your code will be wrong. Here are the most frequent culprits:

Starting a new job without a P45

Without your P45, HMRC doesn't know how much you've earned in the tax year. You'll typically be placed on an emergency code (0T or 0T W1/M1) until your new employer submits a starter declaration.

Benefits in kind not updated

Company cars, private medical insurance, or interest-free loans are treated as taxable benefits. If your employer changes your benefit package and doesn't inform HMRC promptly, your code becomes inaccurate.

Income from multiple sources

If you receive income from a rental property, freelance work, or a pension alongside your salary, HMRC may adjust your PAYE code to collect the additional tax - sometimes incorrectly if their income estimates are off.

Marriage Allowance not applied

If one partner earns below the personal allowance, they can transfer 10% of their allowance to the higher earner. This must be actively claimed - HMRC won't apply it automatically.

Moving to or from Scotland/Wales

Changing your address is essential. HMRC applies S or C prefixes based on your registered address. If you've moved and haven't updated HMRC, you could be paying the wrong regional rates.

Underpaid tax collected via code

If you owed tax from a previous year (via self-assessment or an end-of-year reconciliation), HMRC may collect it by reducing your personal allowance. The deduction should appear on your P2 coding notice.

How to Check and Fix Your Tax Code

HMRC gives you two main routes to check and correct your tax code. The online route is faster and available 24/7.

Option 1: HMRC Personal Tax Account (recommended)

Go to gov.uk/check-income-tax-current-year
Sign in with your Government Gateway account (create one free if you don't have one)
View your current tax code and the reason HMRC has applied it
Update your income details, employment status, or benefits in kind directly on the portal
HMRC automatically issues an updated P2 coding notice and contacts your employer within a few days

Option 2: Call HMRC

Call the HMRC Income Tax helpline on 0300 200 3300 (Monday-Friday, 8am-6pm). Have your National Insurance number and most recent payslip to hand.

Note: wait times can be long. The online portal is almost always quicker unless you have a complex situation requiring a discussion.

Overpaid tax is automatically refunded. Once your code is corrected, your employer's payroll system will recalculate what you owe for the rest of the tax year and reduce future deductions accordingly. If you've overpaid tax for an entire year, HMRC issues a P800 letter after April 5 and either sends a cheque or credits the amount to your bank. You can also claim a refund proactively through your Personal Tax Account.

Tax Codes If You're Self-Employed

If you're self-employed, you don't pay tax through PAYE and therefore don't receive a PAYE tax code in the traditional sense. Instead, you pay income tax and National Insurance through self-assessment - filing an annual return and making two payments on account each year.

However, if you're self-employed and also have an employed income (for example, a part-time PAYE job alongside freelance work), HMRC may adjust your PAYE tax code to collect the self-assessment tax owed through your payslip. This will reduce the number on your code, effectively lowering your personal allowance and collecting additional tax each month - a system called Dynamic Coding.

Self-Employed Tax Calculator →Self Assessment Guide →

Complete UK Tax Code Reference (2026/27)

Code	Meaning	Action needed?
1257L	Standard personal allowance of £12,570. Most employees in England and Northern Ireland.	None - this is correct for most people
S1257L	Standard allowance but Scottish income tax rates apply.	Check if you're registered in Scotland
C1257L	Standard allowance but Welsh income tax rates apply.	Check if you're registered in Wales
1257M	You've received Marriage Allowance from your partner (allowance boosted by ~£1,260).	Confirm you've registered Marriage Allowance
1257N	You've transferred Marriage Allowance to your partner (your allowance is reduced).	Confirm you've registered Marriage Allowance
BR	All income taxed at 20% basic rate. No personal allowance applied.	Check - may be correct for a second job; wrong for your main job
D0	All income taxed at 40% higher rate. No personal allowance.	Usually correct for a second job if you're a higher-rate taxpayer
D1	All income taxed at 45% additional rate.	Correct if you earn over £125,140 and this is a secondary income
NT	No tax deducted. Very rare - only for specific HMRC-approved situations.	Should only be present with specific HMRC instruction
0T	Zero personal allowance. Standard rate bands apply from £0. Emergency code.	Usually temporary - update via Personal Tax Account
K [number]	Negative allowance. The number x 10 is added to taxable income (e.g. K475 = +£4,750).	Review coding notice to understand what's driving it
W1 or M1 suffix	Non-cumulative basis - tax calculated per period, not across the year.	Temporary - should auto-resolve; chase HMRC if persistent

For the official and always-current reference, see gov.uk/tax-codes/what-your-tax-code-means.

Related tools & guides

Now you understand your tax code - put it to use.

UK Tax Calculator →Enter your tax code and salary to see exact take-home pay Bonus Tax Calculator →See how your tax code affects what you keep from a bonus Understanding Your Payslip →Decode every line of your payslip - NI, pension and more Self Assessment Guide →Who needs to file, deadlines, and how to reduce your bill

Frequently Asked Questions

What does 1257L mean on my payslip?

1257L is the most common UK tax code. Multiply 1257 x 10 to get £12,570 - your personal allowance for 2026/27 (the amount you can earn completely tax-free). The 'L' suffix means you receive the standard personal allowance with no adjustments. If you're on 1257L and everything in your financial life is straightforward, you're almost certainly paying exactly the right amount of tax.

How do I read a UK tax code?

Most tax codes follow a simple pattern: a number followed by a letter. Multiply the number by 10 and you get your personal allowance - the income you earn before any tax applies. The letter tells HMRC how to apply that allowance: L = standard personal allowance, M = Marriage Allowance received (10% transferred from partner), N = Marriage Allowance transferred to partner, T = HMRC needs to review your code. If your code is BR, D0, D1, 0T, NT, or starts with K - those don't follow the number-letter format and each has a specific meaning.

What does the BR tax code mean?

BR (Basic Rate) means every pound you earn from that source is taxed at a flat 20% with no personal allowance applied. It's commonly used on second jobs, pensions, or when you start a new job without handing over your P45. If BR appears on your main and only job, contact HMRC urgently - you're almost certainly overpaying tax. On a secondary income source, BR is often correct: your personal allowance is already being used against your primary income.

My tax code is wrong - what do I do?

You can correct a wrong tax code yourself through your HMRC Personal Tax Account at tax.service.gov.uk. Log in, go to 'Check your Income Tax', and you'll see your current coding notice. You can report changes to your income, benefits in kind, or allowances which automatically triggers a new code. HMRC will send the updated code directly to your employer. Any tax you've overpaid is refunded through PAYE - typically within a few weeks. You can also call HMRC on 0300 200 3300.

What is an emergency tax code?

Emergency tax codes (most commonly 0T, 0T W1, or 0T M1) are applied when HMRC lacks enough information about your income - usually when starting a new job without a P45. They give you zero personal allowance, taxing every pound at standard rates, which typically means you overpay. Once your employer submits your starter checklist and HMRC has your records, your code is corrected and any overpaid tax is refunded automatically through your payslip.

What does W1 or M1 on my tax code mean?

W1 (Week 1 basis) or M1 (Month 1 basis) are emergency suffixes added to a code like 1257L W1 or 0T M1. They mean your tax is calculated on just that single pay period as if it were the start of a new tax year - not cumulatively across the whole year. This prevents underpayments when switching jobs mid-year but can cause over or underpayment depending on your circumstances. These suffixes are temporary and should be resolved once HMRC has your full income history.

What does a K tax code mean?

K codes (for example K475) represent a negative personal allowance - the opposite of a standard code. HMRC adds the K number multiplied by 10 to your taxable income rather than deducting it as an allowance. K codes arise when untaxed income (such as state benefits, significant company car benefits, or accumulated underpaid tax from prior years) exceeds your personal allowance. Importantly, there is a legal cap: your employer can never deduct more than 50% of your gross pay in income tax as a result of a K code.

Do Scottish and Welsh taxpayers have different tax codes?

Yes. Scottish taxpayers have an 'S' prefix (e.g. S1257L) and are subject to Scottish income tax rates, which include more bands than the rest of the UK - including a 19% starter rate on the lowest band and a 21% intermediate rate. Welsh taxpayers have a 'C' prefix (e.g. C1257L) and pay Welsh income tax rates. If you've recently moved to or from Scotland or Wales, update HMRC with your new address to ensure you receive the correct prefix and rate band.

Official source: GOV.UK - tax codes explained. Rates and thresholds based on 2025-26 UK tax year. Always check HMRC for the latest figures.