What the letters and numbers in your tax code are telling you

Three weeks into a new job, Sarah opened her first payslip and found more tax deducted than she had expected. Next to her name was a short string she had never paid attention to: 1257L M1. Her previous employer had not yet sent her P45, and that small “M1” told the whole story. She was on an emergency code, and payroll was taxing each month as if it stood alone.

A tax code is HMRC’s instruction to an employer about how much tax-free income to give you from that job. Each job has its own code, and it can change during the year.

Where to find your code

GOV.UK lists several places: your payslip, the HMRC app, a Tax Code Notice letter if HMRC sent one, and the online service for checking Income Tax for the current year. Signing up for paperless notifications means HMRC emails you when your code changes.

What the numbers mean

HMRC starts with the Personal Allowance, which is £12,570 in 2026/27. It adds any extra allowances or reliefs, takes away income it needs to tax through your pay, such as a company car benefit, and then removes the last digit. GOV.UK describes 1257L as the code currently used for most people with one job.

Codes assume nothing else is being adjusted. A real code can differ because of benefits in kind, expenses, underpaid tax from earlier years or other items. Illustrative only.

The everyday letters

• L means you get the standard tax-free Personal Allowance.
• M means you have received a 10% transfer of your husband’s, wife’s or civil partner’s Personal Allowance under the Marriage Allowance. N means you have transferred 10% of yours to them. Our main guide sets out who can use the Marriage Allowance and what it is worth.
• T means your code includes other calculations to work out your Personal Allowance. One situation where the allowance needs extra working is income above £100,000, explained in why the Personal Allowance starts to vanish above £100,000.

A larger number with an L usually means an extra allowance has been added. The Blind Person’s Allowance is one example that many eligible people have never asked for.

Codes that give no allowance at all

These are common for a second job, where the main job already uses the allowance.

• 0T: your Personal Allowance has been used up, or you have started a new job and the employer does not have the details needed to give you a code.
• BR: all income from this job is taxed at the basic rate.
• D0: all income from this job is taxed at the higher rate.
• D1: all income from this job is taxed at the additional rate.
• NT: no tax is taken from this income.

A tax code is HMRC’s instruction to an employer about how much tax-free income to give you from that job.

S and C at the front

A code that starts with S, such as S1257L, means you are taxed at Scottish rates. Scottish versions of the flat-rate codes are SBR (basic rate), SD0 (intermediate rate), SD1 (higher rate), SD2 (advanced rate) and SD3 (top rate), plus S0T. A code starting with C means Welsh rates apply, with C0T, CBR, CD0 and CD1 following the same pattern as the codes used in England. GOV.UK says you pay Scottish Income Tax if you live in Scotland, so the prefix follows your home, and it is worth checking after a move across a border.

K codes and the 50% limit

A K at the start means you have income you are not paying tax on that is more than your Personal Allowance. GOV.UK gives examples: tax owed from a previous year being collected through your wages, company benefits such as a company car, and savings interest above your Personal Savings Allowance, covered in when interest on savings starts to be taxed.

There is a safeguard. GOV.UK says employers cannot take more than half of your pre-tax wages when using a K code. Even so, a K code is worth understanding rather than ignoring, because it means HMRC is collecting something through your pay.

Emergency codes ending W1, M1 or X

Emergency codes are temporary. They tax each payday as if your pay were the same every period, so the amount can be wrong. 1257L W1 is used for weekly pay, 1257L M1 for monthly pay and 1257L X when pay dates vary; payslips sometimes show “NONCUM” instead. They usually appear when a new employer lacks your previous pay details, for example after starting without a P45, or when company benefits begin.

How reliefs reach you through your code

When you claim tax relief for job expenses during the year, GOV.UK says HMRC will usually adjust your tax code so you pay less tax; for earlier years it may adjust the code or send a refund. That is how claims for work uniforms and tools and, where it still applies, working from home usually show up. Higher-rate taxpayers can also ask HMRC to change their code to give them extra relief on Gift Aid donations. People who file a Self Assessment return claim through the return instead.

Who this matters for, and what to check

• Anyone who has changed job, taken a second job or started a company benefit this year.
• Married couples and civil partners using the Marriage Allowance: one code should end in M and the other in N.
• Anyone whose code starts with K, or whose code changed without an obvious reason.
• People who moved between England, Scotland and Wales and whose prefix may not have followed them.

Checking your code and updating your income details in the HMRC app or your personal tax account is free. Firms that offer to check codes for a cut of any refund add nothing the official service does not already do.

A short code worth reading once a year

A few characters carry the allowance you get, any transfer between partners, which country’s rates apply and whether the code is temporary. Reading it each April, and after any change of job, is usually enough to catch a mistake while it is still easy to put right.