A tax code is a short combination of numbers and letters that tells your employer or pension provider how much tax-free income to give you. The standard code for 2026/27 is 1257L: the 1257 stands for the £12,570 Personal Allowance and the L means you are entitled to that standard allowance. If your code is anything else, your tax will be calculated differently, and it is worth finding out why.
Note: this is general information, not tax advice. Tax codes depend on your circumstances and HMRC’s records, so check your own code and any change to it on GOV.UK or with HMRC.
What 1257L actually means
The number in a tax code is your tax-free amount for the year with the last digit dropped. Take the Personal Allowance of £12,570, remove the final zero, and you get 1257. Your employer’s payroll software turns that back into a tax-free amount and spreads it across your pay periods. On a monthly payroll that is £12,570 ÷ 12 = £1,047.50 of tax-free pay each month, and on a weekly payroll about £241.73 a week.
The letter tells the payroll how to treat that number. L is the plain case: you get the standard Personal Allowance and no adjustments. Everything above your tax-free pay is taxed in the usual bands. In England, Wales and Northern Ireland that means 20% on the first £37,700 of taxable income, 40% above that and 45% above £125,140, as set out in UK income tax explained: bands, allowance and how it's worked out.
Your code is not a tax rate and it is not your salary. Two people on very different salaries can both have 1257L, because the code only describes the allowance. A person on £25,000 and a person on £45,000 are both given the same £12,570 tax-free; what differs is how much income sits above it.
The letters you may see
Letters are added to the number to show your situation. The most common ones are:
| Code | What it means | Typical reason |
|---|---|---|
| L | Standard Personal Allowance | Most employees and pensioners |
| M | Marriage Allowance received | You receive a transfer from your spouse or civil partner |
| N | Marriage Allowance transferred | You have given part of your allowance to your partner |
| T | Other items affect your allowance | Reviewed by HMRC, for example reduced allowance on a high income |
| BR | All pay taxed at the basic rate | Often a second job or pension |
| D0 | All pay taxed at the higher rate | A further job where you are a higher-rate taxpayer |
| D1 | All pay taxed at the additional rate | A further income stream for additional-rate taxpayers |
| 0T | No Personal Allowance given | A new job with no information, or allowance fully used elsewhere |
| NT | No tax taken | Rare cases, such as certain non-residents |
| K | Negative allowance: more income to tax than allowance | Large taxable benefits or untaxed income |
Codes can also carry a prefix. S means you pay Scottish income tax rates and C means Welsh rates, so S1257L is the standard allowance for a Scottish taxpayer. Wales currently uses the same rates as England, so the prefix matters mainly for record keeping.
Emergency codes: W1, M1 and X
You sometimes see a code ending in W1, M1 or X, such as 1257L W1. This is an emergency code that applies on a non-cumulative basis. Normally tax is cumulative: each pay day, the payroll looks at your pay and allowance for the whole tax year to date, so over- or underpayments correct themselves automatically. On a W1 (week 1) or M1 (month 1) basis, each pay period is treated on its own, as if it were the first of the year. You get one period’s allowance, with no catch-up for earlier periods.
An emergency code is common when you start a new job without a P45 or when HMRC has not yet told your employer your code. You may overpay tax for a few weeks, and once HMRC sends the right code on a cumulative basis, the overpayment is usually corrected in a later payslip. If you do not see it corrected, contact HMRC. A P45 from a previous employer, or a new starter checklist, helps your new payroll pick the right code.
Why your code might not be 1257L
Several things can change the number or add a letter. Typical causes include:
- Company benefits. A company car, private medical insurance or other taxable benefits in kind are collected by reducing your allowance. A £2,400 taxable benefit takes the code from 1257L to 1017L (£12,570 minus £2,400 is £10,170).
- Underpaid tax. If HMRC finds you owed tax from a past year, it may collect up to a limit through your code. To collect £300 at the 20% basic rate, HMRC removes £1,500 of allowance, giving 1107L.
- A second job or pension. The allowance is only given once. If you have two jobs, the main one usually gets the allowance, and the second gets BR, taxing every pound at 20%.
- Marriage Allowance. This adds 10% to your allowance if you receive it, or takes 10% off if you give it.
- Higher income. If your adjusted net income is over £100,000, the Personal Allowance reduces by £1 for every £2 above that, and your code will move away from 1257L.
- A tax refund that is being clawed back, or a part-year start. Check the notice HMRC sent you.
HMRC sends a coding notice (a P2) to you and your employer when your code changes, and your personal tax account on GOV.UK shows the current code and the reason for it. You can also see it on your payslip, usually near the top.
Worked example: how a code changes your pay
Take someone on £25,000 in England with no pension or student loan. With 1257L their income tax is (£25,000 − £12,570) × 20% = £2,486, and National Insurance is £994, leaving about £21,520. This comes from the same engine as the £25,000 salary after tax in the UK guide.
Now suppose HMRC collects £300 of tax from a previous year through the code, so it becomes 1107L. The tax-free amount falls to £11,070, so taxable income is £25,000 − £11,070 = £13,930, and tax at 20% is £2,786. That is £300 more than before, and take-home falls by £300 to about £21,220 for the year, around £25 a month. National Insurance is unchanged, because it is not worked out using your tax code.
That is the key point: a code change moves your tax, not your National Insurance. If the underpayment is cleared in one year, your code will usually return to normal the next year.
Second jobs, BR codes and getting the allowance right
If you have two jobs paid through PAYE, your Personal Allowance can only be used once across both. Suppose your main job pays £25,000 on 1257L and a second job pays £5,000. If the second employer gives you BR, you pay 20% on every pound, which is £1,000. Together with £2,486 on the main job, that is £3,486 of income tax on £30,000, the same as if you had one £30,000 job. Where the first job pays less than your allowance, you may be overtaxing yourself, and you can ask HMRC to split the allowance between the jobs.
If both jobs together are above the higher-rate threshold, a D0 code may be used on the second job, taxing the second job at 40%. Each case depends on your total income, so use the HMRC tools or ask them to review your codes. Do not change the code yourself; it must come from HMRC.
Marriage Allowance: the M and N codes
Marriage Allowance lets a person who earns less than the Personal Allowance transfer part of it to a spouse or civil partner who is a basic-rate taxpayer. The transfer is 10% of the Personal Allowance, rounded: £1,260. The receiving partner gets an M code (1257L becomes 1383M, because £12,570 + £1,260 = £13,830), and the giving partner gets an N code (1131N, because £12,570 − £1,260 = £11,310).
For the receiver, this can cut the tax bill by up to £252 a year (£1,260 × 20%). Eligibility has conditions, including who may claim and the earnings of each partner, so read the GOV.UK guidance before applying. You apply through GOV.UK, not your employer.
How to check your code is right
Following a short routine takes five minutes and can save real money:
- Find your code on your payslip, P60 or in your personal tax account on GOV.UK.
- Compare it with what you expect. If it is 1257L, you are getting the standard allowance.
- If it is different, look for the HMRC notice or the benefit that explains it.
- Estimate your tax using the calculator below and compare with your payslip.
- If it still does not match, contact HMRC with your code and your last payslip or P60.
Do not try to work out an allowance from a code if it includes a K. A K code means that the sum of your benefits and other income exceeds your allowance, so the number is added to your income instead of subtracted. A K code of 100 adds £1,000 to your taxable pay. Ask HMRC to explain it if you do not understand why it is there.
Common mistakes with tax codes
- Treating the code as a tax rate. It describes an allowance, not a percentage.
- Ignoring an emergency code. A W1 or M1 code can mean you overpay for some weeks, and it should be replaced.
- Changing jobs without checking. A new employer may use BR or 0T if it lacks information. Give them a P45 or your details promptly.
- Assuming a second job gets an allowance. It usually gets BR, which taxes all of it.
- Not checking after a benefit starts. A new company car or private medical insurance should change your code. If it does not, you may face a bill later.
- Leaving a wrong code uncorrected. If you have overpaid, HMRC can refund you, and if you have underpaid, correcting it early avoids a larger catch-up.
Try the calculator
Enter your salary and region in the UK Take-Home Pay Calculator to see income tax and National Insurance at the standard code, then compare the result with your payslip to spot a code that is not 1257L.
Frequently asked questions
What does 1257L mean on a payslip?
It is the standard tax code for 2026/27. The 1257 represents the £12,570 Personal Allowance, and the L shows you receive the standard allowance. Income above that is taxed at the normal rates.
Is 1257L the same as an emergency tax code?
No. 1257L is the normal code. An emergency code usually shows 1257L W1 or M1, which means tax is worked out on a non-cumulative basis until HMRC sends the proper details.
Why has my tax code changed?
Common reasons are a new taxable benefit, underpaid tax from a previous year, a second job or pension, Marriage Allowance, or a change in your income. HMRC sends a coding notice explaining the change, and you can see the reason in your personal tax account.
What does a BR tax code mean?
BR means all income from that job is taxed at the basic rate, 20% in England, Wales and Northern Ireland, with no allowance. It is often used for a second job or a pension where the allowance is already used elsewhere.
Can I change my own tax code?
No. Your code comes from HMRC and your employer must use it. If you think it is wrong, tell HMRC through your personal tax account, by phone or by post, and ask for it to be reviewed.