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. Emergency codes end in W1, M1 or X, for example 1257L W1 (paid weekly) or 1257L M1 (paid monthly). BR is not an emergency code: it taxes all income from that job at the basic rate and is usually used when you have more than one job or pension.
On a W1/M1 code your tax is worked out on what you are paid in that week or month only, as if you were paid that amount every week or month of the year. You get a proportional Personal Allowance each period but no carry-forward from earlier months. On BR, no allowance is given against that job and you pay 20% on all earnings from it.
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. GOV.UK says this can take up to 35 days from when you start your job. 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, and her employer taxes her on the BR code. The comparison below uses 1257L on a month 1 basis, where 1/12 of the £12,570 Personal Allowance (£1,047.50) is tax-free each month.
| Scenario | Monthly tax |
|---|---|
| BR code (20% on all pay) | £500 |
| 1257L, month 1 basis (20% of £1,452.50) | £290.50 |
| Overpaid per month | £209.50 |
If Lisa stays on BR for two months before her code is corrected, she will have paid £419 more than she would have on 1257L. Once a cumulative 1257L code is applied, her payroll works out her tax on her total pay so far in the tax year, and any overpayment is refunded through her pay.
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.
Related calculators: