Why has my tax code changed?

HMRC changes your tax code when you need to pay a different amount of tax. That usually follows a change in your income or circumstances. The first place to look is your payslip, then the Check your Income Tax service, which shows whether your code has changed and why.

The reasons HMRC gives

GOV.UK lists these triggers:

• you start a new job
• you get taxable state benefits
• you start getting income from an additional job or pension
• your savings interest goes above your Personal Savings Allowance
• your weekly State Pension amount changes
• your employer tells HMRC you have started or stopped getting benefits from your job
• you claim Marriage Allowance
• you claim expenses that get tax relief
• you pay the High Income Child Benefit Charge through your wages or pension
• you need to repay the Winter Fuel Payment or Pension Age Winter Heating Payment
• you were on the wrong tax code and owe tax

A new employer without your earlier income details may also put you on an emergency code until HMRC catches up.

Reading the new code

Compare the digits first. If the number has dropped from 1257, HMRC has taken something off your allowance, such as a company benefit, untaxed income or underpaid tax. See tax codes explained for what each letter means. If the letters have changed, the cause is different. W1, M1 or X means an emergency code, BR, D0 or D1 means all pay is taxed at one rate (usual for a second income), and M or N means Marriage Allowance. The 1257L guide shows how an ordinary number is built.

Common cases for public sector staff

Changing employer is the obvious one, for example a move between NHS trusts or from a school to a council. If the new payroll did not receive your P45 in time, you may be on an emergency code for a while. Employer benefits such as a car or private medical cover can lower your code. Taking on bank shifts or a second post can produce a BR code on the second pay. Taxable interest above your allowance, or a claim for job expenses, can also move the number.

If your pay stayed the same but the code changed in April, the employer may simply have updated it for the new tax year. Employers normally do that at the start of each year.

Checking the figures

Sign in to the Check your Income Tax online service or use the HMRC app. HMRC says that is the quickest way to see your employment, pension, estimated taxable income, company benefit and expenses details. If anything is wrong or missing, update it there. If you left a job without getting a P45, ask the old employer for one, since it can help update your details. How to check your tax code lists the other places to look, and a personal tax account shows past codes.

How long a correction takes

If HMRC needs to change your code, it should tell you and your employer within 15 working days. If you are paid monthly, expect the new code on your next or following payslip. If you are paid weekly, it should appear on your third payslip. If your payslip still shows the old code, ask your employer whether they have received the new one.

If you have started a new job and cannot use the online service, wait 35 days for HMRC to get your income details before contacting it.

If you have paid too much or too little

Once the code is corrected and HMRC has your full income details, it works out the difference. An overpayment is normally refunded through your pay, using the new code. For an underpayment, HMRC estimates what you owe and adjusts your code to collect it over one or more tax years where possible. Underpaid tax and code adjustments shows how that appears on a payslip.

Staying informed

HMRC says it will usually contact you to explain how it worked out a changed code, and it may do so by Tax Code Notice letter. If you check your code online or in the HMRC app, you can sign up for paperless notifications and HMRC will email you when the code changes. Looking at your code in the online service also lets you see codes from previous tax years, which helps when you want to know exactly when a change took effect.