Emergency Tax Explained
A temporary tax code HMRC assigns when your employer does not have enough information to tax you correctly. It often leads to overpaying tax until the correct code is issued.
What is emergency tax?
Emergency tax is not a special rate of tax. It is a temporary arrangement where HMRC assigns a default tax code because your employer cannot confirm your tax history. The two most common emergency codes are 1257L W1/M1 (week 1 or month 1 basis) and BR (basic rate, 20% on everything).
On the W1/M1 code, you get a proportional Personal Allowance each period but no carry-forward from earlier months. On BR, you lose your allowance entirely and pay 20% on all earnings.
How it works
Emergency tax usually kicks in when you start a new job without giving your employer a P45. It can also happen if you return to work after a career break, receive a company pension for the first time, or if HMRC's records are not up to date.
Once your employer submits your starter details through RTI (Real Time Information), HMRC reviews your records and issues the correct tax code. This typically takes 1 to 3 pay periods. Any tax you overpaid during the emergency period is refunded automatically through your payroll.
Check your payslip for a "W1" or "M1" suffix after your tax code. That suffix confirms you are on a non-cumulative (emergency) basis.
Real example
Lisa starts a new job in July 2025 earning £2,500 per month gross. She has not given her employer a P45, so they put her on the BR code.
| Scenario | Monthly tax |
|---|---|
| BR code (emergency, 20% on all pay) | £500 |
| Correct code 1257L | £191 |
| Overpaid per month | £309 |
If Lisa is on emergency tax for two months before her code is corrected, she will have overpaid £618. This amount is refunded in her next payslip once the cumulative 1257L code is applied.
Who does this affect?
People starting a new job are the most commonly affected group, especially if they do not have a P45 from their previous employer. New graduates entering the workforce for the first time, people returning from maternity or paternity leave with a new employer, and those starting a second job are all likely to encounter emergency tax at some point.
Pensioners receiving their first pension payment may also be placed on an emergency code if the pension provider does not have their tax details.
HMRC source
gov.uk/tax-codes/emergency-tax-codes explains what emergency tax codes look like and how to get them corrected.
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