UK Tax Code Meanings — 2025/26 Explained
Your tax code is printed on your payslip and P60. It determines how much income tax your employer deducts. Getting it wrong can mean you overpay or underpay tax for months. Here’s what every code means and what to do if yours looks incorrect.
How to Read a Tax Code
A standard code like 1257L has two parts: the number (1257) multiplied by 10 gives your tax-free allowance (£12,570), and the letter (L) tells HMRC how to adjust it.
Tax Code Letter Suffixes
| Letter | Meaning |
|---|---|
| L | Standard Personal Allowance — the most common code (1257L) |
| M | You’ve received Marriage Allowance transfer from your partner (£1,260 extra) |
| N | You’ve transferred Marriage Allowance to your partner (£1,260 less) |
| T | HMRC needs to review your code — includes other calculations |
| K | Your deductions (company car, benefits) exceed your allowance — tax is added to your pay for calculation |
| BR | All income taxed at 20% — typically a second job where allowance is used elsewhere |
| D0 | All income taxed at 40% — second job for higher-rate taxpayers |
| D1 | All income taxed at 45% — additional-rate second job |
| NT | No tax deducted — rare, used for specific HMRC-approved situations |
| 0T | No allowance given — often used as an emergency code or when P45 is missing |
| S | Scottish tax rates apply (e.g., S1257L) |
| C | Welsh tax rates apply (e.g., C1257L) |
Scottish Tax Codes (S Prefix) — 2025/26 Bands
If you live in Scotland, your code starts with S. Scotland sets its own income tax rates which differ from the rest of the UK:
| Band | Taxable Income | Rate |
|---|---|---|
| Personal Allowance | Up to £12,570 | 0% |
| Starter rate | £12,571 – £14,876 | 19% |
| Basic rate | £14,877 – £26,561 | 20% |
| Intermediate rate | £26,562 – £43,662 | 21% |
| Higher rate | £43,663 – £75,000 | 42% |
| Advanced rate | £75,001 – £125,140 | 45% |
| Top rate | Over £125,140 | 48% |
Welsh Tax Codes (C Prefix)
Welsh residents get a C prefix (e.g.,C1257L). Currently, Welsh rates are identical to England and Northern Ireland, but the Welsh Government has the power to change them independently.
Emergency Tax Codes
When HMRC doesn’t have enough information about you — typically when you start a new job without a P45 — they may apply an emergency tax code. Common emergency codes for 2025/26:
- 1257L W1 or 1257L M1 — week 1 / month 1 basis (non-cumulative)
- 0T W1 or 0T M1 — no allowance on non-cumulative basis
- BR — everything taxed at basic rate
Emergency codes are temporary. Once HMRC receives your details, they’ll issue the correct code and your employer will adjust future payslips (and refund any overpayment).
Marriage Allowance Codes
If one partner earns below £12,570 and the other is a basic-rate taxpayer, the lower earner can transfer £1,260 of their Personal Allowance. This saves the higher earner up to£252 per year.
- M code — you received the transfer (your allowance increases to £13,830)
- N code — you gave the transfer (your allowance decreases to £11,310)
Common Scenarios
| Situation | Likely Code | Why |
|---|---|---|
| One job, no benefits | 1257L | Standard allowance |
| Started new job, no P45 | 1257L M1 or 0T | Emergency code until HMRC catches up |
| Second job | BR or D0 | Allowance used on main job |
| Company car / benefits | Lower number or K code | Allowance reduced by benefit value |
| Earning over £100k | Lower number (e.g., 628L) | Allowance tapered |
| Living in Scotland | S1257L | Scottish rates apply |
What to Do If Your Tax Code Is Wrong
- Check your code on your latest payslip or P2 notice from HMRC
- Log in to your Personal Tax Account on GOV.UK
- If the code is wrong, update your details online or call HMRC on 0300 200 3300
- HMRC will issue a new code to your employer — any overpaid tax will be refunded through your wages
Last updated for the 2025/26 tax year (6 April 2025 – 5 April 2026).