KIRSTY APP - Tax Codes

You and your tax - THE TAX CODE

The following illustration is of a notice of coding.

Letter

L

Reason for use: For those eligible for the basic Personal Allowance - 810L for the 2015-13 tax year. It is also used for 'emergency' tax codes (read more in the section 'If you're on an emergency tax code')

P

Reason for use: For people aged 65 to 74 and eligible for the full Personal Allowance

Y

Reason for use: For people aged 75 or over and eligible for the full Personal Allowance

T

Reason for use: If there are any other items we need to review in your tax code, for example the income-related reduction to the Personal Allowance (read more in the section 'Effect on your tax code if your income is above £100,000').

K

Reason for use: When your total allowances are less than your total 'deductions' - read more in the section 'How the 'K code' works'

If the two figures are the same, you'll be paying the right amount of tax. If they are not, get in touch with your tax office.

To be quite sure you are not paying too much tax, fill in your tax form and check your tax code to your own satisfaction. You may save yourself money, and even if you don't, at least you'll be satisfied that your tax is being handled correctly.


Next:

Saving Tax

/wealth/borrowing/tax/saving-tax.html... see: Saving Tax