If you’ve ever glanced at your payslip and wondered what that jumble of letters and numbers—like 1257L or BR—actually means, you’re not alone. UK tax codes can be confusing, but they play a crucial role in determining how much income tax you pay. In this guide, we’ll break down the most common tax codes used in 2025/26, explain what they mean, and help you check if yours is correct.
What Is a Tax Code?
A UK tax code is issued by HMRC and used by employers and pension providers to calculate how much tax to deduct from your income. It reflects your Personal Allowance (the amount you can earn tax-free) and any adjustments for benefits, underpayments, or multiple income sources.
| Tax Code | Meaning | Who It Applies To |
|---|---|---|
| 1257L | Standard tax code for most people | Employees with one job and no special circumstances |
| BR | Basic rate tax (20%) on all income | Second jobs or pensions with no allowance applied |
| D0 | Higher rate tax (40%) on all income | High earners with multiple income sources |
| D1 | Additional rate tax (45%) on all income | Very high earners with multiple income sources |
| K codes | Negative allowance due to benefits or unpaid tax | People with large benefits-in-kind or tax debts |
| S1257L | Scottish version of 1257L | Residents of Scotland under Scottish income tax rules |
| C1257L | Welsh version of 1257L | Residents of Wales under Welsh income tax rules |
| NT | No tax deducted | People exempt from PAYE (rare cases) |
| 1257L W1/M1/X | Emergency code used when HMRC lacks full info | New jobs or missing P45s |
How to Check Your Tax Code
You can find your tax code on:
- Your payslip
- Your P60 or P45
- Your HMRC online account
Use HMRC’s Tax Code Checker to decode your code and see if it’s correct.
Why Tax Codes Matter
An incorrect tax code can mean:
- Overpaying tax (and waiting for a refund)
- Underpaying tax (and facing a surprise bill later)
If your circumstances change—like starting a new job, receiving benefits, or retiring—your tax code should be updated. Always check your code and contact HMRC if something looks off.
Final Tips
- Review your tax code annually, especially in April when the new tax year begins.
- Flag any unexpected changes with HMRC.
- Use your online HMRC account to stay on top of updates.
Try It Yourself: Estimate Your Take-Home Pay
Now that you understand how UK tax codes work, use our simple calculator below to see how your own tax code and income affect your monthly take-home pay. Just enter your details and get a clear breakdown—no spreadsheets, no stress.
