D0 and D1 tax codes explained

D0 and D1 are tax codes that tax every pound from one job or pension at a single flat rate, with no tax-free allowance. D0 means the higher rate of 40 per cent and D1 means the additional rate of 45 per cent. HMRC uses them almost always for a second job or a second pension, when your main income has already used up your allowance and your basic rate band (D0), or everything up to £125,140 (D1). The tax they collect is what your total income would owe anyway.

The flat-rate codes

Code	Rate on all pay from that job	Where it applies
BR	20% (basic)	England, NI
D0	40% (higher)	England, NI
D1	45% (additional)	England, NI
CBR, CD0, CD1	20%, 40%, 45%	Wales
SBR, SD0, SD1, SD2, SD3	20%, 21%, 42%, 45%, 48%	Scotland

Wales uses the C prefix, and for 2026/27 its rates match England’s. Scotland’s codes follow its own bands: SD0 is the intermediate rate (21 per cent), SD1 the higher rate (42 per cent), SD2 the advanced rate (45 per cent) and SD3 the top rate (48 per cent).

Why HMRC gives a second job D0

Your tax-free allowance and your basic rate band can only be used once. HMRC normally puts the whole £12,570 allowance on your main job, so the main job’s code is 1257L and any second job gets a code with no allowance.

If your main job pays less than £50,270, the second job is usually given BR, which taxes it all at 20 per cent; see the BR tax code. If your main job pays more than £50,270, the basic rate band has already been used there, so any extra income is higher rate income. That is when the second job gets D0. If the main job pays more than £125,140, extra income is taxed at 45 per cent, so the second job gets D1.

In Scotland the thresholds differ. SD1 appears when your main income passes the start of the Scottish higher rate at £43,663, and SD2 when it passes £75,000.

A worked example

Say you are a band 8a manager in England on £57,528 and you also work as an examiner, paid £4,000 a year through a separate payroll. Your main job uses your allowance and your whole basic rate band, and the top part of it is already taxed at 40 per cent. On a D0 code the examining payroll takes 40 per cent of every payment, so £1,600 over the year.

If the second employer had used BR instead, it would have taken £800 and you would owe the other £800 later. If it had used 1257L, it would have taken nothing and HMRC would have to collect £1,600 afterwards.

Pension contributions in the main job can change this. Contributions to the NHS Pension Scheme come off before tax, so a band 8a salary of £57,528 gives taxable pay of about £51,372 after the 10.7 per cent contribution. Only around £1,100 of that main-job pay is above £50,270. If your taxable pay in the main job were below £50,270, HMRC could split your basic rate band and give the second job a code that taxes part of it at 20 per cent. This is worth checking in your HMRC personal tax account, because the estimates there drive the code.

National Insurance is separate

D0 and D1 are income tax codes only. National Insurance is worked out for each job separately, so the second job has its own Primary Threshold of £242 a week (£1,048 a month). If the second job pays less than that in a pay period, you pay no employee NI on it. Above the threshold, 8 per cent applies in that job even if your main job has already passed the upper earnings limit; any excess is dealt with by HMRC after the year ends. National Insurance when you have two jobs covers this.

When D0 or D1 is wrong

The code depends on HMRC’s estimate of your income, so check:

• whether the codes are on the right jobs (the main allowance should be on the job that pays most)
• whether HMRC still has an old, higher salary on record for your main job
• whether a pension or bonus counted in the estimate has stopped or will not recur.

If your total income will be lower than HMRC thinks, update the estimate in your personal tax account or the HMRC app. HMRC then issues new codes, and payroll refunds any excess through the cumulative calculation. For NHS staff with bank shifts on a separate payroll, tax on NHS bank shifts explains which code to expect, and tax when you have two jobs covers splitting the allowance in more detail.