Tax Code 0T Explained UK 2026/27: Why You Have It & How to Fix

Tax code 0T (zero-T) means no Personal Allowance - every penny of your income is taxed from the first pound. For most employees this is an emergency setting, not a permanent state. If you see 0T on your payslip and it's your only job, you're paying about £210/month more tax than you should at basic-rate income.

This guide explains what 0T means, why HMRC issues it, and exactly how to get a corrected code in place.

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What 0T means

The numeric part of a UK tax code (e.g. 1257 in 1257L) represents your tax-free Personal Allowance divided by 10. 0T means your Personal Allowance has been set to zero - you have no tax-free income for the year, and PAYE applies the full band rates from your first pay packet.

For 2026/27 the bands under 0T:

First £37,700 of income:    20% tax
£37,700 - £125,140:         40% tax
Above £125,140:             45% tax

Compare against the standard 1257L:

First £12,570:               0% tax (Personal Allowance)
Next £37,700:               20% tax
£50,270 - £125,140:         40% tax
Above £125,140:             45% tax

The difference for a £30,000 earner: £2,514 more tax per year under 0T.

When HMRC issues 0T

HMRC applies 0T in three situations:

1. Starter-checklist Statement C

When you start a new job and don't provide a P45 from your previous employer, your new employer asks you to complete a "Starter Checklist". The checklist has three statements:

Statement A: This is my only job. → Code 1257L cumulative.
Statement B: This is my only job, but I've had another in this tax year. → Code 1257L W1/M1.
Statement C: I have another job or pension. → Code BR (every penny taxed at basic rate).

There's no statement that produces 0T, but if you fail to complete the checklist at all, HMRC defaults to 0T as the safest assumption (treating you as if you have no available Personal Allowance).

2. Multiple high-income jobs

If you have multiple jobs and your combined income clearly exceeds the Personal Allowance, HMRC may apply 0T to the second/third employment to ensure all income gets taxed at the correct band rate from the first pound.

3. Lost contact with HMRC

If HMRC hasn't received recent records for you (e.g. you've been overseas for an extended period and just returned to UK employment), they apply 0T as a defensive default until they reconcile your record.

How to spot it on your payslip

Your payslip's "tax code" field will show literally "0T" - sometimes preceded by S (Scottish) or C (Welsh): S0T, C0T.

The tax deduction will be unusually high relative to your gross pay. For a £2,500/month gross with 0T:

Gross pay:                 £2,500.00
Tax-free this period:        £0.00 (0T = no allowance)
Taxable pay:               £2,500.00
PAYE (20%):                  £500.00
NI (8% above PT):            £116.20
Net pay:                   £1,883.80

Compare against 1257L:

Gross pay:                 £2,500.00
Tax-free this period:    £1,047.50 (1/12 of £12,570)
Taxable pay:               £1,452.50
PAYE (20%):                  £290.50
NI (8% above PT):            £116.20
Net pay:                   £2,093.30

You're £209.50/month worse off under 0T. That's £2,514 over a full tax year of an incorrect code.

How to fix it

Step 1 - Confirm 0T is wrong for your situation

0T is correct only if you genuinely have no Personal Allowance available. The most common reasons for that: significant income from another source (second job, rental income, pension) that uses up your full allowance.

If this is your only income source, 0T is probably wrong.

Step 2 - Talk to payroll

Email payroll: "My tax code is 0T this month. Can you confirm the source code from HMRC and whether a starter checklist was completed when I joined?"

If the issue is a missing or incorrect starter checklist, payroll can usually issue a fresh checklist for you to complete. Once submitted, HMRC issues a corrected P6 to your employer (typically within 4-6 weeks). Your code becomes 1257L cumulative or 1257L W1, depending on your circumstances.

Step 3 - Talk to HMRC if payroll can't fix it

If HMRC's records are wrong (they think you have a second job that you don't, or they have the wrong income estimate for you), you need to talk to them directly:

Sign in to your HMRC Personal Tax Account and review your employment record.
Update any incorrect information from the PTA.
If the PTA doesn't let you fix it, call HMRC on 0300 200 3300 with your NI number and PAYE reference to hand.

Step 4 - Reclaim the over-deduction

If 0T was applied for several pay periods, you'll have over-paid tax. Once your code is corrected to 1257L cumulative, your next pay packet usually contains an automatic refund - your employer's payroll catches up the under-allowed Personal Allowance for the year.

If the correction comes via a W1/M1 code instead of cumulative, the over-payment doesn't auto-refund. In that case:

HMRC reconciles at year-end (April-July) and issues a P800 letter with refund details.
OR you can claim the refund directly from your PTA after 6 April (current year) or after the year ends.

0T vs BR - what's the difference

Both 0T and BR involve no Personal Allowance, but BR taxes everything at the basic rate (20%) regardless of how much you earn. 0T applies the full band rates - basic, higher, additional.

For a £45,000 earner:

BR: £45,000 × 20% = £9,000 tax
0T: First £37,700 at 20% = £7,540, next £7,300 at 40% = £2,920. Total: £10,460 tax.

So 0T is worse than BR for higher earners; BR is worse than 0T for low earners (because BR applies 20% to the first £12,570 that should be tax-free, while 0T's first chunk is also 20%).

For most employees on either code, both are wrong, and the fix is the same - correct your code to 1257L cumulative.

When 0T is correct

In genuinely unusual situations, 0T can be the right code:

Two high-income jobs where your combined income exceeds £125,140 → HMRC applies 0T to the secondary employment to ensure all of it is taxed at the right rate.
Pension income exceeding your Personal Allowance that's already using up your full allowance.
You've moved abroad and your UK employer needs to default to a code that doesn't assume UK residence.

If your code is genuinely 0T because of one of these, your payslip is correct - the over-deduction will reconcile naturally at year-end.

Disclaimer

PayslipIQ provides automated educational guidance based on the figures you supply. It is not regulated tax advice. Tax-code corrections involve communication between you, your employer, and HMRC; for unusual situations or substantial back-pay claims, contact HMRC on 0300 200 3300 or use a CTA-qualified tax adviser.