Tax codes explained Emergency tax codes

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If you're on an emergency tax code, talk to your employer immediately

What to do if you're on an emergency tax code

If your employer does not know what your tax code should be, you will be taxed on an 'emergency' code of 1000L (944L in 2013-14) or given a BR code.

A BR code means that you receive no tax free personal allowance, so everything you earn will be taxed at 20%. Although you can claim back overpaid tax from HMRC, it is better to get your code changed as soon as possible, so you are given the correct allowance and pay the right amount. To do this, you should give your employer your P45 (or a completed P46 if you don't have a P45 from previous employment). 

If you are put on the emergency code 1000L, you will be given a tax free allowance of £10,000, above which you will start paying tax. 

For most employees this will be correct, as it is the  basic personal allowance for those aged under 65 and assumes that you are entitled to 1/12 of the allowance each month, (or 1/52 each week if you are paid weekly). However, it does not take into account any backlog of allowance that may be due to you – for example, following a period of unemployment. For this reason your employer may have to adjust the 1000L coding in some cases. As with a BR code, you need to contact your employer straight away and give them your P45 (or complete a P46 if you don't have one), in order to make sure you get the correct tax code.

 

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