HMRC will provide new tax codes at the start of every new tax year if the Personal Allowance has changed, if someone has had a change of circumstances, including perhaps had a pay rise, and even to those who are taking their pensions for the first time.
It’s important to check that your tax code is correct, as any mistake early in the year could mean paying too much or too little tax going forwards. Either way, the sooner you get this sorted out, the better, as you don’t want to be owed money by HMRC, and you certainly don’t want to owe unpaid tax.
How can I check my tax code?
There are various ways you can check your tax code, including speaking to your employer or your HR department, if your company has one. You can also look online to see what all the elements of the tax code mean and identify whether you think these have been applied correctly to you.
For example, 1257L is the code that most people will have if they have a job or a pension. This represents the £12,570 Personal Allowance that each person has – unless it is eroded away for those who are in the highest tax bracket. The ‘L’ denotes that you are entitled to the full tax-free Personal Allowance.
The numbers in the tax code indicate the amount of Personal Allowance you have, while the letters represent a variety of things. You can find a full list on Gov.uk. But if you would prefer to get an expert to check it for you, then get in touch with your accountant.
Let us help you
If you need any assistance checking your tax code, please get in touch and we will be happy to offer you the help and guidance you need.
