HMRC Tax Codes
What letters in your tax code mean
The L Code: The most common letter which means you're under 65 and eligible for basic tax-free personal allowance.
The M Code: You're married and 10% of your partner's personal allowance was transferred to you.
The N Code: You're married and transferred 10% of your personal allowance to your spouse using your marriage allowance.
The S Code: You're using the Scottish rate of income tax.
The Y Code: You were born before 6 April 1938 and get a higher personal allowance.
The T Code: Your tax code includes other calculations to work out your personal allowance.
The 0T Code: Your personal allowance has been used up, you don't have a form p45 or your new employer doesn't have enough information to work out your tax code.
The R Code: All your income from this job or pension is taxed at the basic rate (if this is your second job, for instance).
The D0 Code: All your income from this job or pension is taxed at the higher rate.
The D1 Code: All your income from this job or pension is taxed at the additional rate.
The NT Code: You don't pay tax on this income.
There are a few more codes for special circumstances. K, for example, means your tax-free allowance has been reduced so much that it's in the red. That's like owing tax on money you haven't even earned! Another instance where your tax code might change, is if you've claimed a tax refund. When you claim a tax refund HMRC might assume that your expenses will be the same the following year. In that case, they might change your code so you don't pay too much tax. However, this can cause problems if your expenses or circumstances change. Always talk to RIFT if your code is altered and you don't know why. We can check for you and get it fixed if it's wrong. Generally, though, the letter in the list above are the main ones to know about.