Millions of workers urged to check key code on special payment slips arriving in DAYS – check if you're overpaying

Scottish Sun

19-05-2025

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MILLIONS of workers have been urged to check a key code on a special payment slip revealing if they're overpaying tax.
The warning has been issued to employees who should receive their P60s before the end of the month.
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The wrong tax code on your P60 means you could be overpaying tax to HMRC
P60s are issued to workers at the end of every tax year with the final deadline for bosses to send them May 31.
They are sent out either electronically or in paper form.
However, one key detail on the P60 could tell you you're paying the wrong amount of tax - your "final tax code".
If it turns out you are on the wrong code, it means you could be overpaying tax and are owed money from HMRC.
Bear in mind though, you may also be underpaying tax and have to pay HMRC any shortfall.
Sarah Coles, personal finance expert at Hargreaves Lansdown, said: "It isn't always easy to get to grips with your P60, but the thing to look for is the final tax code.
"If it's wrong, you could end up over-paying or under-paying your tax – either of which is a pain in the neck."
Your tax code could be wrong for any number of reasons, including if you have multiple jobs and your employer doesn't know your personal allowance has been used up from earnings elsewhere.
You may also be on the wrong code if you've changed jobs and your employer hasn't received the right documentation from a previous employer.
Or, someone in the HR department might simply have made a clerical error meaning you're on the wrong code.
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How to check your tax code
A tax code is normally a five-digit mixture of letters and numbers. The most common tax code for the current tax year is 1257L.
This tax code is used for most people with one job and no untaxed income, unpaid tax or taxable benefits (like a company car).
You can check your tax code on your online personal tax account, via payslips, or on the HMRC app.
You can also, if you've received one, check your code on a "Tax Code Notice" letter from HMRC.
You'll need your Government Gateway ID and password to log in to your online personal tax account.
If you don't have this you can use your National Insurance number or postcode and two of the following:
a valid UK passport
a UK photocard driving licence issued by the DVLA (or DVA in Northern Ireland)
a payslip from the last three months or a P60 from your employer for the last tax year
details of a tax credit claim if you have made one
details from a Self Assessment tax return (in the last two years) if you made one
information held on your credit record if you have one (such as loans, credit cards or mortgages)
You can also use MoneySavingExpert.com's free tax code calculator which can give you a steer as to whether you're on the right one.
How to report a wrong tax code
If, after checking, you think you're on the wrong tax code, you can contact HMRC to tell them via phone on 0300 200 3300.
This is usually the quickest way to get a response.
Or, you can send a letter to the following address: Pay as You Earn and Self Assessment, HM Revenue and Customs, BX9 1AS, United Kingdom.
If you are on the wrong tax code and have been paying too much, HMRC will change it so you pay the correct amount moving forwards.
They should also reimburse any tax you've already overpaid.
If you've been underpaying tax, you will usually have to pay the money back over 12 months.
But, only if you are earning enough over the personal tax allowance (£12,570) to cover the underpayment and owe less than £3,000.
HMRC might get in touch with you to tell you you're owed a tax rebate too - they'll do this via a P800 letter or a simple assessment letter in the post.
But again, a P800 might tell you if you've not paid enough tax and have to pay it back.
A P800 letter will tell you if you can claim online through the Government's website, in which case you'll need your Government Gateway ID and password.
If you claim the money online it will be sent to your bank account within five days.
You can also claim your refund through the HMRC app.
If your P800 letter states you will be paid your tax rebate via cheque in the post, you should receive it within 14 days of the date on your letter.
If you're owed tax from more than one year, you'll get a single cheque for the entire amount.
There are time limits in place to reclaim any overpaid tax, which is currently four years from the end of the tax year in which you are trying to claim.
So, if you're in any doubt you've overpaid tax, you should contact HMRC as early as possible.
What your tax code means
Your tax code is a combination of letters and numbers.
The number will normally dictate the level of your tax-free allowance. So if your allowance is £11,000 the first four digits of your code will be 1100.
The letters have different meanings - here is a guide: L - You're entitled to the standard tax-free personal allowance
- You're entitled to the standard tax-free personal allowance M - Marriage Allowance: you've received a transfer of 10 per cent of your partner's personal allowance (£1,260)
- Marriage Allowance: you've received a transfer of 10 per cent of your partner's personal allowance (£1,260) N - Marriage Allowance: you've transferred 10 per cent of your personal allowance to your partner
- Marriage Allowance: you've transferred 10 per cent of your personal allowance to your partner S - Your income or pension is taxed using the rates in Scotland
- Your income or pension is taxed using the rates in Scotland T - Your tax code includes other calculations to work out your personal allowance, for example, it's been reduced because your estimated annual income is more than £100,000
- Your tax code includes other calculations to work out your personal allowance, for example, it's been reduced because your estimated annual income is more than £100,000 0T - Your personal allowance (which is currently £12,570) has been used up, or you've started a new job and your employer doesn't have the details they need to give you a tax code
- Your personal allowance (which is currently £12,570) has been used up, or you've started a new job and your employer doesn't have the details they need to give you a tax code BR - All your income from this job or pension is taxed at the basic rate (usually used if you've got more than one job or pension)
- All your income from this job or pension is taxed at the basic rate (usually used if you've got more than one job or pension) D0 - All your income from this job or pension is taxed at the higher rate (usually used if you've got more than one job or pension)
- All your income from this job or pension is taxed at the higher rate (usually used if you've got more than one job or pension) D1 - All your income from this job or pension is taxed at the additional rate (usually used if you've got more than one job or pension)
- All your income from this job or pension is taxed at the additional rate (usually used if you've got more than one job or pension) NT - You're not paying any tax on this income
- You're not paying any tax on this income Tax codes starting with K mean you have income that isn't being taxed another way and it's worth more than your tax-free allowance
If your tax code begins with 'W1', 'M1' or 'X' you've been placed on an emergency tax code and may need to update your details.
If you change jobs, take on an additional role or have another change in circumstances it is also worth checking your details and making sure you are on the correct code.
It could be that HMRC has not received information about your change of circumstances and therefore will not update anything.
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