Am I Paying the Right Tax on My Salary
To check if you are on the correct PAYE (Pay As You Earn) tax code in the UK, follow these steps:
1. Check your payslip
- Every payslip from your employer will show your tax code.
- Look for a section called “Tax Code” or something similar, usually near your earnings and deductions.
2. Look at your P45 or P60
- Your P45 (if you leave a job) or P60 (annual summary of your earnings and tax paid) will also show your PAYE tax code.
3. Check your Personal Tax Account online
You can check your tax code by logging into your personal tax account with HMRC (Her Majesty’s Revenue and Customs):
- Go to the [HMRC website](https://www.gov.uk/personal-tax-account) and sign in or create an account.
- Once logged in, you can see your current tax code and review your tax details.
4. Understanding your tax code
- Most common tax codes:
- 1257L: This is the most common tax code for the 2023/24 tax year. It means you're entitled to the standard tax-free personal allowance of £12,570.
- K codes: These codes are used when you have taxable income that wasn’t taxed before, and it exceeds your Personal Allowance.
- BR: Stands for “Basic Rate” and means you are taxed at the basic rate of 20% on all of your income (typically for second jobs).
- D0: Means you're taxed at 40% (higher rate) on all of your income (usually for second jobs).
5. Compare with your circumstances
- Personal Allowance: For the 2024/25 tax year, if your annual income is below £100,000, you should be entitled to a full Personal Allowance of £12,570.
- Multiple jobs or pensions: If you have multiple sources of income, your tax code might split your allowances across them.
6. Contact HMRC if unsure
- If you think your tax code is wrong, or you don’t understand it, contact HMRC directly. They can adjust your tax code if needed.
This should help ensure you're on the right PAYE code and paying the correct amount of tax.
1. Check your payslip
- Every payslip from your employer will show your tax code.
- Look for a section called “Tax Code” or something similar, usually near your earnings and deductions.
2. Look at your P45 or P60
- Your P45 (if you leave a job) or P60 (annual summary of your earnings and tax paid) will also show your PAYE tax code.
3. Check your Personal Tax Account online
You can check your tax code by logging into your personal tax account with HMRC (Her Majesty’s Revenue and Customs):
- Go to the [HMRC website](https://www.gov.uk/personal-tax-account) and sign in or create an account.
- Once logged in, you can see your current tax code and review your tax details.
4. Understanding your tax code
- Most common tax codes:
- 1257L: This is the most common tax code for the 2023/24 tax year. It means you're entitled to the standard tax-free personal allowance of £12,570.
- K codes: These codes are used when you have taxable income that wasn’t taxed before, and it exceeds your Personal Allowance.
- BR: Stands for “Basic Rate” and means you are taxed at the basic rate of 20% on all of your income (typically for second jobs).
- D0: Means you're taxed at 40% (higher rate) on all of your income (usually for second jobs).
5. Compare with your circumstances
- Personal Allowance: For the 2024/25 tax year, if your annual income is below £100,000, you should be entitled to a full Personal Allowance of £12,570.
- Multiple jobs or pensions: If you have multiple sources of income, your tax code might split your allowances across them.
6. Contact HMRC if unsure
- If you think your tax code is wrong, or you don’t understand it, contact HMRC directly. They can adjust your tax code if needed.
This should help ensure you're on the right PAYE code and paying the correct amount of tax.