What is an NT tax code and why have I got it?
Last reviewed January 2023
| Quick answer: | An NT tax code means that you aren't paying income tax at all on your earnings. |
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Last reviewed January 2023
| Quick answer: | An NT tax code means that you aren't paying income tax at all on your earnings. |
There are actually quite a few reasons why you might get an NT tax code. For example:
Keep in mind that having an NT tax code only lets you off the hook for Income Tax. You could still have to pay National Insurance Contributions (NICs) out of your earnings.
With a normal tax code like 1257L, you get a tax-free Personal Allowance before you start paying tax at the basic rate. An NT tax code is very different, though, since it basically tells your employer not to take any Income Tax out of your pay at all!
As we mentioned above, this still doesn’t mean you won’t have to cough up your normal National Insurance payments, though. In fact, you wouldn’t even want it to, since your NICs entitle you to key things like the State Pension.
Most of the time, HMRC will alter your tax code for you as your circumstances change. However, there are times when you might end up on the wrong tax code – and when that happens you need to get it fixed fast. It’s your responsibility to get the problem sorted, and things can get very tricky if you don’t.
Getting an NT tax code might seem like a great deal – as long as it’s not a mistake. Remember, paying less tax than you owe is usually even worse than paying too much. When HMRC catches on, you can quickly find yourself getting stung with fines and penalties – or even a criminal record!
If you think your tax code’s wrong, you need to contact HMRC to make sure they have the information they need to put it right. If you’re claiming a tax rebate with RIFT, of course, we’ll check your tax code for you as part of the service. If you’re ever given the wrong code, we’ll get it corrected for you.
Find out more about how to change your tax code
Being on the wrong tax code can easily leave you paying the wrong amount of Income Tax on your earnings. For example, this can happen when:
Any of these situations can mean you’re paying too much Income Tax and might be able to claim a tax refund. Get in touch with RIFT to find out more about tax rebates, and to see how the UK’s leading experts can get back everything you’re owed.
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