What is an emergency tax code?
An emergency tax code is only meant to be a temporary measure, but it could see you losing a big chunk of your income. Here's what you need to look out for.
If you're on an emergency tax code it will show on your payslip, looking like one of these (in 2020/21):
- 1250 W1
- 1250 M1
- 1250 X
What makes these codes different is that they're “non-cumulative”. Basically, this means that they don't take any other circumstances or tax you've paid into consideration, so you'll be taxed on everything you earn above whatever Personal Allowance you qualify for.
If you spot one of these codes (specifically the letters at the end, as the numbers change whenever the Personal Allowance threshold does) and don't know why, get in touch with RIFT for help.