Second Job tax - how does tax work with two jobs in the UK?

RIFT Roundup: The Essentials

• You normally have one Personal Allowance across all your income. The standard allowance is £12,570 for 2026/27.

• Two PAYE jobs will normally have separate tax codes.

• BR, D0 and D1 can be used on additional employments, but the appropriate code depends on your total expected income.

• Self-employed side-hustle income has different reporting rules.

• National Insurance is normally calculated separately for jobs with different employers.

• Student loan deductions are also normally calculated separately by each employer.

Taking on a second job can increase your income, but it can also change the rate of tax you pay.

The important point is that HMRC looks at your total taxable income across the tax year. You don’t receive a new Personal Allowance for every job.

Here’s how second-job tax works in the 2026/27 tax year.

Do you get a second Personal Allowance for a second job?

No.

The standard Personal Allowance for 2026/27 is £12,570, assuming you’re entitled to the full amount.

You only receive one Personal Allowance for the tax year, regardless of how many jobs, pensions or other sources of income you have.

HMRC will usually allocate the allowance to your main employment, often the job paying you the most.

Your other job may then have a tax code that deducts Income Tax from the first pound paid by that employer.

If your main job uses less than your full Personal Allowance, HMRC can sometimes allocate some of the unused allowance to another job.

What tax codes are used for second jobs?

For taxpayers in England, Wales and Northern Ireland, common codes for an additional employment include:

• BR: all income from that employment is taxed at the basic rate of 20%

• D0: all income from that employment is taxed at the higher rate of 40%

• D1: all income from that employment is taxed at the additional rate of 45%

A 0T code can also appear in some circumstances, including where no Personal Allowance is available to that employment.

These codes do not mean the second job itself has independently crossed a tax threshold. HMRC uses information about your expected total income when deciding which code should apply.

Scottish taxpayers have different Income Tax bands and tax codes.

What are the Income Tax rates for 2026/27?

For employment income in England, Wales and Northern Ireland, someone entitled to the full £12,570 Personal Allowance will normally pay:

• 0% on the first £12,570

• 20% on taxable income within the basic-rate band

• 40% on taxable income within the higher-rate band

• 45% on taxable income above the additional-rate threshold

The basic-rate band covers the first £37,700 of taxable income after allowances. With the full Personal Allowance, this means the higher rate generally begins once total income exceeds £50,270.

The Personal Allowance starts to reduce once adjusted net income exceeds £100,000 and can fall to zero.

Scottish employment income uses six rates in 2026/27, ranging from 19% to 48%, so Scottish taxpayers should use the Scottish bands when checking the effect of another job.

Example: £30,000 main job and £8,000 second job

Assume you live in England, Wales or Northern Ireland, have no other taxable income and receive the full Personal Allowance.

Your total employment income is:

£30,000 + £8,000 = £38,000.

After the £12,570 Personal Allowance, taxable income is £25,430.

That is entirely within the 20% basic-rate band.

If your Personal Allowance is allocated to your main job, your second employer may therefore use a BR code and deduct £1,600 of Income Tax from the £8,000 second-job salary.

The actual PAYE position depends on the codes HMRC issues and your circumstances.

Example: £45,000 main job and £15,000 second job

Again, assume you live in England, Wales or Northern Ireland and receive the full Personal Allowance.

Total income is:

£45,000 + £15,000 = £60,000.

After the £12,570 Personal Allowance, taxable income is £47,430.

The first £37,700 falls within the basic-rate band and the remaining £9,730 falls within the higher-rate band.

If the Personal Allowance is fully allocated against the £45,000 main job, that main job uses £32,430 of the basic-rate band.

This leaves £5,270 of the basic-rate band for the second job.

Of the £15,000 second-job salary:

• £5,270 would fall at 20%

• £9,730 would fall at 40%

This is why simply saying “a second job is taxed at 20%” can be misleading.

Do you need to tell HMRC when you get a second PAYE job?

If both jobs are PAYE employments, your employers report pay and tax information to HMRC through payroll.

When you start the second job and do not have a P45 because you’re keeping your first job, your new employer will normally ask you to complete a Starter Checklist.

You should indicate that you already have another job.

HMRC can then issue tax codes based on the information it holds.

It’s still worth checking both codes through your Personal Tax Account or HMRC app. Payroll reporting does not guarantee that HMRC’s estimate of your annual income is immediately perfect.

What if your second income is self-employed?

Self-employed work is handled differently from a second PAYE job.

If your gross trading income is £1,000 or less in a tax year, the trading allowance may mean you do not need to tell HMRC about that income, subject to the detailed rules and exceptions.

If gross trading income is more than £1,000, you will normally need to tell HMRC and may need to register for Self Assessment.

Examples can include:

• freelance work

• delivery work carried on as self-employment

• paid content creation

• a small trade or business

• regularly buying or making goods to sell for profit

Selling your own unwanted personal belongings does not automatically make you a trader.

Rental income also has its own tax rules and a separate property allowance, so it should not automatically be treated as trading income.

Do you pay National Insurance on both jobs?

National Insurance is separate from Income Tax.

Where you work for different employers, Class 1 National Insurance is normally calculated separately for each job.

For most employees in 2026/27, the standard employee rates are:

• 8% on weekly earnings between £242 and £967

• 2% on earnings above £967 a week

Because the calculation is generally carried out separately for each employer, it is possible to pay National Insurance in both jobs.

Higher earners with multiple employments may sometimes be able to apply to defer some Class 1 contributions to avoid paying above the annual maximum.

What happens to student loan repayments with two jobs?

Each separate employer normally looks only at the earnings it pays you.

It does not combine your salary with earnings from another employer when calculating payroll student loan deductions.

This means someone with two jobs could earn more than their repayment threshold overall while neither individual job triggers the same deductions that would have applied if all the income came from one employer.

If you complete a Self Assessment return, relevant income is brought together and this can result in an additional student loan or postgraduate loan repayment.

Can a second job cause you to underpay or overpay tax?

Yes.

Common causes include:

• an incorrect tax code

• HMRC holding an outdated estimate of one job’s income

• both jobs receiving too much Personal Allowance

• a BR or D0 code being used when your expected total income changes

• stopping one job without HMRC’s records being updated promptly

HMRC checks PAYE records after the end of the tax year and may issue a P800 calculation where someone has paid too much or too little tax.

Checking your tax codes during the year can help catch problems earlier.

Does a second job affect benefits?

Extra earnings can affect means-tested benefits such as Universal Credit.

The effect depends on your household circumstances, earnings and the specific benefit rules. If you receive benefits, check the current DWP guidance or speak to the relevant benefits service before relying on a particular calculation.

Second job tax FAQs

Is a second job always taxed at 20%?

No. The rate depends on your total taxable income and where you live in the UK. A second employment might be taxed using a BR, D0, D1 or another code.

Why is my second job on a BR code?

BR normally means all pay from that job is being taxed at 20%. It is commonly used where your Personal Allowance has been allocated elsewhere and HMRC expects the extra income to remain within the basic-rate band.

Can HMRC split my Personal Allowance between two jobs?

Yes, in appropriate circumstances. This can be useful where one job does not use the full allowance.

Do I have to complete Self Assessment just because I have two jobs?

Usually no, if both are straightforward PAYE employments. Self Assessment may be required for other reasons, including certain self-employment, property income, capital gains or other untaxed income.

What should I do if my tax code looks wrong?

Check your employment and estimated-income details through HMRC’s online services. You can update incorrect information or contact HMRC if the code does not reflect your circumstances.