Inland Revenue Tax Codes

Everyone that works in the UK is given a tax code. Your tax code determines how much tax your employer deducts from your pay and consequently how much pay you tax home.

Your tax code is dertmined by your allowances, deductions and benefits such as company cars. If you company does not know what tax code to put you on you may be placed on an emergency tax code and as a result overpay tax.

Your tax code is normally made up of some number and a letter. If you take the number within your tax code and multiple this by 10, you can calculate your tax free allowance. This is the amoutn that you can earn before paying any tax.

The Letter in your Tax Code

The letter in your tax code corresponds to how your allowance should be adjusted following any changes announced by the Inland Revenue or the chancellor. Below is a list of some of the common letter within tax codes and what they mean:

Letter in Tax Code Meaning
L For people entitled to the basic Personal Allowance – 647L for the 2010-11 tax year.
P For people aged 65 to 74 and eligible for the full Personal Allowance
Y For people aged 75 or over and eligible for the full Personal Allowance
T If the Inland Revenue need to review any other items in your tax code, for example the income-related reduction to the Personal Allowance.

Tax code ‘0T’ means your allowances have been used up or reduced to nil and your income is taxed at the relevant tax rates.

K This tax code is used when your total allowances are less than your total ‘deductions’.

Sometimes you may not be given a normal tax code, one that does not have a number. This could be because you have two jobs or your employer was not given a P45.

Tax Code Meaning
BR This tax code is used when all your income is taxed at the basic rate and you are not given any tax allowances. If you are on this tax code you can often end up overpaying tax if it is your only job.
D0 This tax code is used when all your income is taxed at the higher rate of tax – currently 40 per cent .
NT This tax code is given when no tax is to be taken from your income or pension

29 comments

  1. lorraine Telford says:

    if i had a job earning £1800 a year and i chose to do a second job with an income off £200 a month would i have to pay higher tax on my first job at all . its just my husband cant work as he is disabled and we cant afford the rent every week so i need a second income really but dont want to do it if its going to cost me in tax as that will just be a loss not a gain . thank you if you could let me know please how this would affect me .

  2. jillian brazier says:

    i am a pensioner anual salary is 5414.62 my tax code is223t i have a state pension only

  3. joanne barrow says:

    iam i entitled to a tax rebate on a lease car after twelve months of having the car?

  4. J Kelly says:

    I have just left the military and my only income is my military pension. I have just been put on Tax code D0, this doesn’t seem correct as it’s the high tax bracket.
    What tax code should I be on?

  5. roy says:

    please explain my tax code 72T

  6. roy says:

    please explain my tax code 72T

  7. margaret Mcarthur says:

    I’m on OT Tax Code 74yrs old What should i be on

  8. dd says:

    how much do you have to earn before you atre taxed

  9. how much can you earn before you are tax says:

    How much can you earn before you are taxed

  10. james says:

    my tax code is MSL how much percent is taken from my wages every week

  11. Marc young says:

    My ax code is 647L W and I am wondering what the W is for

  12. audrey tate says:

    my date of birth is wrong on my p60 from dumfries and galloway college what do i di to change that

  13. guru says:

    what the meaning of tax code call nt

  14. David Beale says:

    I have two small pensions one from a former employer and one from the Prudential I have been given dfferent tax codes for these why?

  15. Linda Booth says:

    I have 2 tax codes, why?
    1. BT Pension
    2. present employment

  16. Steven Greig says:

    My tax code is O653L or 0653L (begins with zero). I have been unable to track down this tax code on-line anywhere. Any information you can give would be appreciated.

    Thank you.

  17. Loretta says:

    I have paid a BR tax code for three months is it worth claiming as I have now left this employment and my new tax code is 416L

  18. m mayor says:

    why is it that only married women over 65 pay the higher rate of tax and not the 10% on the first £2000

  19. alan o,connor says:

    as a retired man of 72 how much income can I have before tax

  20. Kay Simpson says:

    Hi I have just been informed by my employers that my tax code will be changing to K31 what does this mean and why?
    Than you Kay Simpson

  21. sam says:

    hi i have recently finished a higher education course at the end of june but started getting taxed in may and my tax code has changed to 27T what does it mean as i seem to b getting taxed nearly £130 a month on a £450 wage

  22. Liam McAulay says:

    I have paid BR rate tax on my last 3 jobs do I get the money back?

    • TaxFix says:

      Liam McAulay: If you have been on a BR (or emergency tax code) you may have overpaid tax. Was this for the current tax year or previous years? If it was for previous years you can make a claim now, if not you will need to wait until the end of the current tax year.

  23. Donna Blair says:

    I have a second job what is the percentage of tax i pay on this second job

  24. Anonymous says:

    ia m on the right tax code? 649L cumul. I am on an anual salary of 29.464

  25. Scotham says:

    I have tried to telephone the local tax office and can never get through to them. They keep you on hold on an 0845 number. I have written to them and have received no reply on my query about a tax code!

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