Wrong Tax Code on Your Payslip? How to Check It, Fix It and Claim Back Overpaid Tax

How do I find my tax code on a payslip?

Your tax code appears on your payslip near your gross pay, deductions and net pay, usually labelled “tax code” or “tax cd”. Employers must give you an itemised payslip on or before payday.

The same code also appears on:

• your P45, if you have recently left a job
• your P60, issued after the end of the tax year
• your PAYE coding notice (form P2) from HMRC
• your HMRC personal tax account and the HMRC app

Compare the code on your latest payslip with the one HMRC holds. If they differ, your employer may not have applied a newer code yet.

What do 1257L, BR, 0T, D0, W1, M1 and X mean?

Your tax code tells your employer how much tax-free income to give you. HMRC starts with your Personal Allowance, subtracts untaxed income and adjustments such as company benefits, then replaces the final digit with a letter. A code of 1257L means £12,570 of tax-free pay across the year.

Source: HMRC, What your tax code means.

For 2026 to 2027, the Personal Allowance is £12,570. Basic rate tax of 20 per cent applies from £12,571 to £50,270, higher rate of 40 per cent from £50,271 to £125,140, and additional rate of 45 per cent above that. Scotland sets its own bands. The allowance reduces by £1 for every £2 of adjusted net income above £100,000 and reaches zero at £125,140.

What is an emergency tax code and why am I on one?

An emergency tax code ends in W1, M1, X or NONCUM. Instead of working out tax on your total income so far in the tax year, your employer taxes each week or month in isolation, as though you earn that amount in every period of the year.

This can produce the wrong deduction in either direction. If your first payment from a new employer is unusually large, or if you did not use your full allowance earlier in the year, you will normally pay too much.

Emergency codes are temporary. HMRC replaces them once it holds the correct information.

Why is my tax code wrong after changing jobs?

Your code goes wrong after a job change when your new employer does not have your previous pay and tax details. Without a P45, payroll applies an emergency code to your first payment.

Give your P45 to your new employer as soon as you receive it. If your old employer did not issue one, ask for it. Without a P45, complete the HMRC starter checklist so payroll can apply the closest available code.

HMRC updates the code once it receives details from both employers and sends the new code to you and your employer. According to GOV.UK, this can take up to 35 days from the day you start the job. If more than 35 days have passed and the code still looks wrong, contact HMRC rather than waiting.

Can I be overtaxed with two jobs or a job and a pension?

Yes. HMRC usually allocates your Personal Allowance to one main source of income and codes the second source BR, D0 or D1, so every pound from it is taxed.

Overpayment happens when the allowance sits against the wrong source. If your main job pays less than £12,570 a year, part of your allowance goes unused, while your second job or pension pays tax from the first pound. HMRC does not always spot this during the year.

Starting the State Pension or receiving company benefits such as private medical insurance or a company car will also change your code, and can put you on an emergency code until the end of that tax year.

How do I check what information HMRC holds?

Sign in to your HMRC personal tax account or the HMRC app to see your current tax code, your estimated income for the year and how your allowance is split between employers. HMRC also provides a check what your tax code means tool.  

Check three things specifically:

1. Estimated annual pay. An inflated estimate is the most common reason a code goes wrong, particularly after a bonus, overtime or a short period of higher earnings.
2. Company benefits. Confirm the listed benefits match what you actually receive, and at the correct value.
3. Deductions in the code. Look for adjustments collecting an earlier underpayment or untaxed income you no longer have.

You can correct estimated pay and benefits in the tax code service, or by contacting HMRC directly.

When is an emergency tax refund automatic, and when should I act?

During the tax year, your employer refunds the overpayment through your pay once HMRC issues a corrected cumulative code. GOV.UK states that a monthly payroll should apply the new code on your next pay or the one after, and a weekly payroll by your third pay.

After the tax year ends on 5 April, HMRC reviews your position using details from employers, pension providers and the benefits office. If the figures do not match, HMRC sends either a P800 tax calculation letter or a Simple Assessment letter, issued between June and March.

Refund timings depend on the route:

Only employees and pension recipients receive these letters. If you file a Self Assessment tax return, HMRC adjusts your bill through the return instead, so no P800 arrives. A Simple Assessment letter is issued where tax cannot be collected through your code, where you owe more than £3,000, or where tax is due on your State Pension.

If you believe you overpaid and no letter has arrived, do not wait. Use the GOV.UK check how to claim a tax refund tool to identify the correct route for your circumstances.

How far back can I claim overpaid tax?

You have four years from the end of the tax year in which the overpayment arose. The time limit for overpayment relief sits in Schedule 1AB to the Taxes Management Act 1970.

In the 2026 to 2027 tax year, the earliest open year is 2022 to 2023, and any claim for that year must reach HMRC by 5 April 2027. Once a year closes, the tax is not recoverable except in narrow circumstances.

Review all four open years together rather than the most recent one alone. A coding error that ran for several years usually produces an overpayment in each of them.

Wrong tax code checklist: what to do today

1. Find the tax code on your most recent payslip.
2. Compare it with the code shown in your HMRC personal tax account or the HMRC app.
3. Give your P45 to your new employer, or complete the HMRC starter checklist if you do not have one.
4. Correct your estimated pay and company benefits in the tax code service, or contact HMRC to report the change.
5. Keep your P45s, P60s, payslips and coding notices for all four open tax years, so you can support a backdated claim.

Which tax codes go wrong most often

Four situations account for most PAYE coding errors:

• Overlapping pay. You leave one job and start another, and both employers pay you in the same month. GOV.UK lists this as a common reason for receiving a P800.
• Company benefits coded at full-year value. A benefit given up part-way through the year continues to reduce your allowance until you tell HMRC.
• A second income coded BR against an underused allowance. Common among part-time workers and people drawing a pension alongside employment.
• An inflated pay estimate after a one-off payment. HMRC projects the higher figure across the year and reduces your allowance accordingly.

Your tax code is HMRC’s estimate of your position, not a final calculation. Correcting the underlying information is what fixes the code.