When you start a new job without giving your employer a current-year P45, you complete a Starter Checklist (the modern replacement for form P46). The checklist asks you to pick one of three statements, and each one produces a different starter tax code. The table below sets out the three statements and the code each produces; statement C leaves the personal allowance with the original employer, which is why the new job is taxed from the first pound.
The wrong statement is one of the most common causes of overpaid PAYE - picking C when B was correct, for example, will tax all your new job's earnings at 20% from £1, generating a hefty refund position by year-end.
Worked example: Tariq leaves Employer A in February 2026 and starts at Employer B in April 2026. He doesn't have his P45 yet because Employer A has been slow. Statement A is incorrect because he has had earnings since 6 April. Statement B is the right pick: he gets 1257L M1, paying tax conservatively until either his P45 arrives or HMRC issues a coding notice based on his RTI history. Until Tariq either gets a P45 or contacts HMRC to switch to cumulative, he may overpay tax for several months - his recovery route is the year-end P800 reconciliation or a mid-year call to HMRC requesting a cumulative code.
| Statement | What it says | Resulting tax code |
|---|---|---|
| A | First job since 6 April, with no taxable benefits or pension | 1257L cumulative |
| B | Now the only job, but there has been other employment or taxable jobseekers allowance since 6 April, and no state pension | 1257L Week 1 / Month 1 |
| C | There is another job, or a state or occupational pension | BR — 20% on all of this jobs earnings |
Picking C where B was correct taxes the new job from the first pound and is one of the most common causes of overpaid PAYE.
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