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Free Tax Code Calculator

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Dan and Helen S

Updated April 2018

Don't get beaten by the systemIt looks like an innocuous set of digits, but your tax code has a critical impact on your finances. Every year millions of people are hit by errors, and some are due £1,000s back. Letters with your 2018/19 code were sent earlier this year. If you haven't already, check yours NOW.

This guide includes the Tax Code Calculator, updated for the 2018/19 tax year, to ensure you're on the right tax code, and how to handle underpaid and overpaid tax. It's likely millions each year still could be owed (or owe) £100s.

Thanks to Tony Tesciuba (Tesciuba Ltd) & Matthew Brown (Chartered Inst of Taxation) for feedback/suggestions. Every effort's been made to ensure accuracy, yet this guide isn't authorised, tailored tax advice (get help here). We can't take responsibility nor accept liability for damage or losses; you use the info at your own risk.

What's a tax code?

Before we start explaining what a tax code is, it's important to understand that not everyone has one.

Who has a tax code?

Full or part-time employees

Those receiving a private pension

Who doesn't?

Fully self-employed or unemployed people

Those ONLY receiving a state pension

On the face of it, a tax code is a dull and harmless series of numbers and letters – 1185L, S1185L, BR and K497 are just some examples for the current tax year.

But these hieroglyphics are used by your employer to calculate the amount of tax that should be deducted from your wages or pension before they hit your bank account.

Therefore if you pay tax through PAYE, the tax code tells your employer or pension provider what it should take – and even small errors can lead to mistakes of £100s.

So the aim here is to find your tax code and decipher what it means, to see if it's correct. Don't worry, we'll take you through it simply.

Then you can punch it into our unique tax code calculator which will give you a steer on whether you may have over- or underpaid. Finally, and most importantly, the guide will explain step-by-step what to do about it...

Tax Code Checker

Quick questions

Why are there so many tax code mistakes?

How likely am I to be on the wrong tax code?

Important! Have you changed address and not told HMRC?

People have used this guide to reclaim up to £10,600!

Since launching this guide in late 2010, we heard of a blast of successes after MoneySavers used the Tax Code Calculator and realised they were on the wrong code! We'll let some lucky forumites take over the tale. Please tell us about your tax rebate successes.

Seeing the email, I thought I'd check mine as I had my payslip handy and I was surprised to see my code was BR. Digging out older slips, I saw I'd been on basic rate tax since I started, which seemed odd.

Quick call to HMRC confirmed I should have been on L – they've refunded just under £1,500 for last year and are updating my employer, so I'll be £130 better off each month going forward! Golddustmedia

I got the MSE email, checked my tax code, rang HMRC and it told me I'd get between £5,000 and £7,000 back. Incredible!

It's all because it'd been deducting for a company car and medical insurance that I've never had in this job. Chris Kendall

I was made redundant last year so was entitled to redundancy, and as part of sorting my finances out etc. I checked my tax code via my accountant and received a whopping £10,640. Dale

I've rung HMRC and a letter is in the post. I've been on the wrong tax code and paying too much since 2005!

I've had a cheque for £3,698 dating back to 2006 and that's not including this year's return either! I'm very happy indeed and would of been none the wiser had it not been for MSE so thank you very, very much! nat21luv

Step 1. Finding your tax code

Taking on your tax code is not an appealing task for even the most dedicated MoneySavers. But it doesn't have to be that gruelling.

How do I find my tax code?

It's listed on your 'coding notice', payslips or P45s. The most important thing to remember...

Each income source (job, private pension) will have different tax codes. Check them all!

tax code checkerThe best source to find your tax code is your PAYE Coding Notice (or P2). A copy of this is sent to both you and your employer around March, just before the start of each tax year. It tells them how to deduct tax, and explain to you how this code was arrived at.

If you can't find your coding notice, then there's other places to look for your tax code...

  • Your payslip: Perhaps the easiest place to look is on your payslip, which you will receive from your employer every time you get paid (whether it's monthly or weekly).
  • Your P45: If you have dumped your payslips, (though it's always best to keep them for records) hunt down a copy of your P45. This is the form given to you by your employer when you stop working for them – and the one you give to your new employer when you change jobs.
  • Your P60: This form is a summary of your salary and the tax that's been deducted. Your employer is required to give you this at the end of each tax year.
  • HM Revenue and Customs: If you can't lay your hands on any of these, contact your tax office with your National Insurance number. After a few basic security questions, they will disclose your tax code (or codes) to you.
  • Tax code for pensions: If you're receiving a private pension, the easiest place to find your code will be on any pension advice slip or on your P60 sent once a year.

What does my code mean?

Tax codes are made up of two main elements, which determine the amount of tax your employer will take. If you work for multiple employers (or work and also draw a pension), you'll have more than one code.

Here's an example of a common tax code for the new tax year in April (similar ones for past years include 1150L and 944L). It will usually be made up of numbers and letters:


What do the numbers show?

What does the letter show?

What SHOULD your tax code be?

This is where you need to switch on your brain. The key bit to check it's correct is the number...

  • Find your personal allowance

    The first thing that HMRC does to establish your tax code is to tot up all of your tax allowances – in other words how much you can earn before you start to pay tax. In many cases this will be just your personal allowance.

  • Are there any deductions?

    Any income you haven't paid tax on at source is known as your deductions. The usual suspects are taxable employment benefits or extra income, eg, renting out a property or State Pension.

    Common taxable benefits include discounted rent or household bills, vehicle usage, medical insurance, healthcare cashplans, some travel costs, payment in vouchers and goods bought on company credit cards.

  • Use these to make the number in your tax code

    These deductions are subtracted from the total amount of tax allowances you get (probably your basic personal allowance), and what's left is the total amount of tax-free income you are permitted in each tax year.

    HMRC then removes the last digit of this number (so 1185 in the case of the 2018/19 standard £11,850 personal allowance) – and hey presto! You've established the number part of your tax code.

In the majority of cases, these numbers will be followed by a letter. And this letter will vary according to your particular circumstances.

Step 2: The Tax Code Calculator

tax code checkerTo try to help you work out whether your code's correct, we've devised an easy-to-use calculator to give a ROUGH answer (it's impossible to be exact). If it seems to be wrong, it shows it could be worth taking action to check out whether you're owed cash (or will be asked to pay back).

Have one employer (& no work perks) and earn under £100,000? Your 2018/19 code should probably be 1185L.

Before using the tax code calculator

HMRC's famous slogan that 'tax doesn't have to be taxing' is well-intentioned but is rarely true. If you don't fit the average working mould, click on the following statements for an explanation of how your situation differs – it may explain any discrepancies in the code. There's lots of extra info on the website too.

I've more than one job

I've never worked but will be starting soon

I've taken several years off work

I've not been living in the UK

I've employee benefits, for example, a company car, or healthcare insurance

I'm receiving tax credits or child benefit

I'm retiring or retired

Tax Code Calculator How much are you owed?

Once you've found your tax code (see above for how-to), enter it to find out whether it seems to fit you, or reasons why it may not.

This is just a ready reckoner. It gives you a steer as to whether you may be on the wrong code. Only regard it as an estimate, and ensure you back it up with your own research and contact with the Tax Office. We cannot accept responsibility for action taken on the back of this calculator.

Step 3: Think your tax code's wrong?

Now you understand what your tax code means, you will be able to assess whether it's likely to be correct for your earnings, age and situation. If your tax code doesn't look right, it probably isn't.

The onus is on you to get on the right tax code! We now have two possible scenarios, and one is much more fun than the other!

But, don't panic...

  • If you have overpaid tax, the money will come back to you.
  • And if you have underpaid, not only do debtors' prisons no longer exist, you probably won't have to pay it back all in one go either.

I've overpaid – how do I get my cash back?

I've underpaid – what happens now?

Please report successes/failures getting money back in the tax code calculator successes forum discussion

Step 4: Keep an eye on future codes

tax code checkerWith any luck, once you have established the right tax code, it'll all be sorted with HMRC from then on, unravelling the web of complexity surrounding tax codes and what you ultimately should be paying. Yet don't bank on it...

Small changes can change your code

Every time your circumstances change whether it's a promotion at work with a larger salary, new employee benefits, taking on another job, giving up work to have children or leaving the country and the UK tax system behind altogether, your tax code may change, so it can be worth getting in touch with HMRC to establish your new tax code.

A phone call today can save an awful lot of hassle and expense in the future...

Get free tax help

This guide is to give you general information about tax codes to help see if you're on the right track. Yet it's no substitute for personal advice if you need it – and you should always take care to ensure you're definite about any actions you're taking.

The following organisations all give help and advice and some don't charge a fee, so give them a try if you are struggling:

Tax Aid: Lots of info's available here, but TaxAid can only help those on a low income who can't resolve their own issues with HMRC.

Citizen's Advice Bureau: Visit Citizens Advice's website to get the number of your local Citizen's Advice Bureau.

Low Income Tax Reform Group: This is an initiative from the Chartered Institute of Taxation, aimed at those with low incomes who have tax problems. Visit Litrg.

Tax Help for Older People: If you're aged over 60, you can try Tax Help for Older People or call 01308 488066.

Find a tax adviser: If you can afford it and have more complex affairs. You can use the Chartered Institute of Taxation's 'Find a Tax Adviser' search.

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For all the latest deals, guides and loopholes - join the 12m who get it. Don't miss out