What does your tax code actually mean? Type in your code and salary to decode your tax-free allowance and see exactly how much Income Tax HMRC expects you to pay for 2026/27.
England, Wales & Northern Ireland · 2026/27
Your tax code tells your employer or pension provider how much tax-free income you get before Income Tax starts. Most codes are made of numbers and a letter. The number is your annual tax-free allowance with the last digit removed — so the standard code 1257L means £12,570 of tax-free pay, the full Personal Allowance for 2026/27.
The letter then describes your situation. It can boost or reduce your allowance, or set a flat rate of tax on the whole job. Getting your code wrong is one of the most common reasons people over- or under-pay tax, so it pays to understand what yours is telling you.
| Code | Meaning |
|---|---|
| L | Standard Personal Allowance (1257L = £12,570 tax-free) |
| M | Marriage Allowance — received 10% of a partner's allowance (+£1,260) |
| N | Marriage Allowance — transferred 10% to a partner (−£1,260) |
| BR | All income taxed at the basic 20% rate, no allowance |
| D0 | All income taxed at the higher 40% rate |
| D1 | All income taxed at the additional 45% rate |
| 0T | No allowance; banded at 20% / 40% / 45% |
| K | Deductions exceed your allowance — extra income is added to your pay |
With code 1257L, the first £12,570 is tax-free and the rest of a £40,000 salary sits in the 20% band.
A K code works in reverse. It is used when untaxed income or taxable benefits — like a company car, medical insurance, or the State Pension — are larger than your Personal Allowance. Instead of giving you tax-free pay, HMRC adds the K number (times ten) to your taxable income. So K475 adds £4,750 to what you're taxed on. To protect you, no more than 50% of your pay can be taken in tax under a K code in any pay period.
It means you get the standard £12,570 Personal Allowance for 2026/27. The number is your allowance with the last digit dropped (1257 = £12,570), and L means the basic allowance with no adjustments.
They set a flat tax rate with no allowance: BR taxes everything at 20%, D0 at 40% and D1 at 45%. They're common on a second job or pension where your main income already uses your allowance.
A K code applies when untaxed income or benefits exceed your allowance. The K number is added to your taxable pay rather than subtracted, so you're taxed on more than the job pays. No more than 50% of your pay can be taken under a K code.
They relate to Marriage Allowance. M means you've received 10% of a partner's allowance (+£1,260); N means you've transferred yours away (−£1,260).