Understanding Your Tax Code
Your tax code is used by your employer or pension provider to work out how much Income Tax to take from your pay or pension. The most common tax code for the 2025/2026 tax year is 1257L.
- 1257L: This is the standard tax code for most people who have one job or pension. It means you have a Personal Allowance of £12,570.
- BR: All your income from this job or pension is taxed at the basic rate of 20%.
- D0: All your income from this job or pension is taxed at the higher rate of 40%.
- K Codes: (e.g., K475) This means you have income that is not being taxed another way and it's worth more than your tax-free allowance.