A 0T tax code means no tax-free personal allowance, so every pound is taxed. Here's when 0T is right, when it's wrong, and how to fix it in 2026.
Seeing 0T on your payslip is unsettling, because it almost always means more tax is coming out than you expected. The good news is that 0T is usually a temporary admin issue, not a permanent loss, and once you understand what it does you can get it corrected quickly. Here is what a 0T tax code means, when it is correct, and how to fix it if it is not.
A 0T tax code means you get no tax-free personal allowance, so every pound you earn from that job is taxed straight away at the normal rates.
In the 2026/27 tax year, most people have the code 1257L, which gives a personal allowance of £12,570 a year, the slice of pay you keep before income tax starts. A 0T code strips that slice away entirely. The “0” stands for zero allowance, and the “T” tells your employer that HMRC may review the code.
With a normal code, your tax-free allowance is spread evenly across the year, so roughly the first £1,047 of your monthly pay is tax-free. With 0T, none of it is. You are taxed from the very first pound, across the same bands everyone else uses: 20% on the basic-rate band, 40% on the higher-rate band, and 45% on the additional-rate band.
A worked example shows the cost. Say you earn £30,000 a year, paid monthly.
On the correct code (1257L), you pay income tax only on the amount above your allowance. That is £30,000 minus £12,570, which is £17,430, taxed at 20%. Your income tax for the year is about £3,486, roughly £290 a month.
On a 0T code, you lose the allowance, so the whole £30,000 is taxed. At 20% that is £6,000 for the year, about £500 a month.
That is a difference of around £2,514 over a year, or roughly £209 a month, on the same salary. The 0T code has not changed what you actually owe in the end, but it takes the extra now and leaves you to reclaim it later.
People often mix up 0T and BR, and the difference matters. A BR code taxes all of your income from that job at the basic 20% rate, full stop. A 0T code removes your allowance and then applies the full set of bands, so if you earn enough, parts of your pay can be taxed at 40% or 45%. For a higher earner, 0T usually takes more than BR. If you want the wider picture, our guide to tax code 1257L explains the normal code that 0T replaces.
A 0T code can run in two ways. A plain 0T is cumulative, meaning it looks at your pay across the whole year so far. You may also see 0T W1 or 0T M1, which is non-cumulative, meaning each week or month is taxed in isolation without reference to what came before. Non-cumulative codes are common right after a job change, and they often sort themselves out once HMRC has your full picture.
Sometimes 0T is genuinely correct, and there is nothing to fix.
It is right when your personal allowance is already being used somewhere else. If you have two jobs or a job and a pension, HMRC usually gives your whole allowance to one of them. The second source can correctly sit on 0T or BR, because you have no allowance left to apply there.
It is also right if you earn a high income. The personal allowance is reduced by £1 for every £2 you earn above £100,000, and it disappears completely once your income reaches £125,140. Above that level, a 0T code reflects the fact that you have no allowance left.
For most people who suddenly land on 0T, it is a temporary error, and the usual cause is a job change.
If you start a new job and do not give your new employer a P45 from your last one, and you do not complete HMRC’s starter checklist, your employer has no information about your allowance. To avoid undertaxing you, payroll applies an emergency or 0T code until HMRC steps in. It is the safe default, neither a penalty nor a sign you did anything wrong, but it does cost you money in the short term.
It can also be wrong if your circumstances changed, for example a second job ended, and HMRC has not yet moved your allowance back to your main job.
The fix is usually straightforward.
First, give your employer the right information. If you have a P45 from a previous job in this tax year, hand it to payroll. If you do not, complete HMRC’s starter checklist, which tells your employer enough to apply a proper code.
Second, check your code with HMRC directly. Sign in to your personal tax account or the HMRC app and look at your current tax code at gov.uk/check-income-tax-current-year. If the 0T looks wrong, you can tell HMRC there, and they will issue an updated code to your employer.
Third, expect the money back. Once the correct code is applied, any tax you overpaid is normally refunded through your next payslip. If the year ends on 5 April before it is corrected, HMRC reconciles your tax afterwards and sends a refund, usually with a P800 calculation. Our guide on how to verify your tax code walks through the checks step by step.
The mechanics of 0T have not changed for 2026/27. The personal allowance is still frozen at £12,570, the £100,000 taper still removes it at £1 for every £2, and it is still gone at £125,140. So 0T means the same thing it always has.
What has shifted is how you find out about it. HMRC has moved to a digital-first approach, so code changes increasingly arrive through the HMRC app and your online tax account rather than a posted letter. That makes 0T easier to miss if you do not check your payslip, and easier to fix quickly if you do.
If you have a second job or a pension alongside your main income, 0T is one of a small family of codes that all skip the personal allowance, and it helps to know how they differ so you can tell whether yours is right.
BR taxes everything from that source at the basic 20% rate. D0 taxes it all at the higher 40% rate, and D1 taxes it all at the additional 45% rate. These flat codes are typically used on a second job or pension, where your main job already uses your allowance and HMRC knows roughly which band your extra income falls into. 0T sits slightly apart, because instead of a single flat rate it removes the allowance and then applies the full set of bands in order.
For most second-job holders earning modest amounts, BR is the code you would expect to see, and a 0T on a low-paid second job can actually overtax you compared with BR. That is worth checking. If you earn well into the higher-rate band across your jobs combined, D0 may be the accurate code instead. None of these are penalties, they are HMRC’s way of collecting the right tax across more than one income, but they do go wrong when your circumstances change, so it pays to glance at the code on every payslip.
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A 0T tax code means you get no tax-free personal allowance, so all of your pay is taxed at the normal rates of 20%, 40% and 45% depending on how much you earn. It is different from BR, which taxes everything at the basic 20% rate only.
The most common reason is starting a new job without giving your employer a P45 and without completing HMRC's starter checklist. It can also happen if your personal allowance is being used against another job or pension, or if you earn more than £125,140, where the personal allowance is reduced to nil.
Yes. Once HMRC issues your correct code, any overpaid tax is usually refunded automatically through your pay. If it is not corrected before the tax year ends on 5 April, HMRC reconciles it after year end and sends a refund, often via a P800 calculation.
BR taxes all of your income from that job at the basic 20% rate. 0T also removes your personal allowance, but it then applies the full set of tax bands, so higher earnings can be taxed at 40% or 45%. For a higher earner, 0T usually takes more than BR.
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A note on financial advice: NetPay UK calculates take-home pay based on official HMRC tax rules. This article reflects rules in force at the time of publication (5 June 2026). Tax rules change. For complex situations, consult a qualified UK accountant or visit gov.uk/income-tax.
