Tax code 0T — no personal allowance, full UK bands apply
If your payslip shows tax code 0T, HMRC has told this PAYE source to apply no personal allowance but to use the full UK band ladder — 20% basic, 40% higher and 45% additional — against your gross pay. It is commonly issued when HMRC does not yet have enough information about you, when you start a new job without a P45, or when your income has tipped above the £125,140 threshold where the personal allowance fully tapers away.
What this code means
Per gov.uk's coding guidance, the “0” in 0T means zero personal allowance, and the “T” flags that the code includes a calculation HMRC wants to keep under review (often the income-related taper). Unlike code BR, which fixes every pound at 20%, 0T applies the standard 2026/27 band ladder in full. The first £37,700 of taxable pay is at the basic rate (20%), pay from £37,701 to £112,570 is at the higher rate (40%), and anything above £112,570 of taxable pay is at the additional rate (45%). Because there is no allowance, the band thresholds effectively start from £0 of gross pay on this source.
0T is therefore the harshest of the “no allowance” codes when applied to a high salary, because it can pull pay into the 40% and 45% bands on a single source. It is correct in specific scenarios but very often wrong when applied to a standard main job — usually because paperwork has not caught up.
- 0 × £10 = £0 of personal allowance. No tax-free pay against this source.
- Suffix T — HMRC wants to keep the calculation under review (frequently linked to the £100,000 + taper or other variable items).
- Full band ladder. Distinct from BR (20% only), D0 (40% only) or D1 (45% only).
Who gets tax code 0T
Per HMRC, 0T appears in a handful of distinct scenarios. The most common reasons quoted on coding notices (form P2) are below. Your own P2 will spell out which one applies.
- No P45 and no starter checklist at a new job
- Per gov.uk, if you start a new job and your employer has neither a P45 from your last role nor a completed starter checklist, payroll must default to 0T on a non-cumulative (W1/M1) basis. HMRC has no information about year-to-date pay or whether the personal allowance is available, so it withholds tax using the full band ladder until evidence arrives.
- Income above £125,140 — allowance fully tapered
- For 2026/27 the personal allowance tapers by £1 for every £2 of adjusted net income above £100,000, and reaches zero at £125,140. HMRC will issue 0T when your projected income removes the allowance entirely. The result is real and correct, not a clerical error.
- Second PAYE source above the basic-rate band
- If you have two jobs and HMRC believes the basic-rate band is already used by the main job, the second job may move from BR to 0T so that the 40% (and 45%) bands apply automatically. 0T behaves like BR/D0/D1 stacked together on a single source.
- After a tax-code error HMRC needs to neutralise quickly
- When HMRC discovers that an earlier code gave too much allowance — for example after closing a duplicate employment — it may issue 0T as a holding code to stop further under-deduction, then issue a permanent code once the year-to-date position is reset.
- Pension drawdown without a P45
- Pension providers commonly apply 0T (Month 1) to a first drawdown payment if no P45 has been supplied. The same logic applies — no record of allowance, so withhold defensively until HMRC reconciles.
Worked example — £30,000 gross on 0T vs 1257L
Same £30,000 salary in England, Wales or Northern Ireland for 2026/27, compared on 0T and 1257L:
| Step | 1257L | 0T |
|---|---|---|
| Gross pay | £30,000 | £30,000 |
| Personal allowance | £12,570 | £0 |
| Taxable pay | £17,430 | £30,000 |
| PAYE at 20% | £3,486 | £6,000 |
| Extra PAYE on 0T vs 1257L | — | £2,514 / year (≈£209.50 / month) |
That £2,514 is the value of the £12,570 allowance at the 20% basic rate. On a higher salary the gap widens fast — at £60,000, 0T pulls pay above £37,700 into the 40% band immediately, whereas 1257L on £60,000 keeps far more in the basic-rate band.
Common mistakes & red flags
- 0T on your only job under £100,000. Almost certainly wrong. Provide a P45 or starter checklist and HMRC will normally swap to 1257L.
- 0T W1/M1 for months on end. A holding code should resolve within a couple of pay periods. If it has not, chase HMRC and payroll.
- 0T on a one-off bonus. Final pay or large bonuses paid after a P45 has been issued are often coded 0T — gov.uk requires this for irregular post-employment payments.
- 0T on a pension lump sum. Common, then reconciled later — often produces a P800 refund.
What to ask payroll
- “Why was 0T applied — was it a missing P45 / starter checklist?”
- “Is this 0T cumulative or W1/M1?”
- “Can you process my P45 now if you have it?”
- “What HMRC coding notice triggered 0T — and when?”
- “If HMRC re-issues a cumulative code, will the refund process through payroll?”
How to fix it
- Hand over your P45 (or complete the starter checklist). Tick “this is now my only or main job” if true.
- Check your HMRC personal tax account. Sign in at gov.uk and review your current code and the P2 reason.
- Tell HMRC about a change. Use the online service or call PAYE on 0300 200 3300.
- Watch the next payslip. Once a cumulative 1257L (or similar) reaches payroll, the overpaid PAYE refunds in the next pay run.
Frequently asked questions
- What does tax code 0T mean?
- Per gov.uk, tax code 0T means no personal allowance is available against this PAYE source, but the standard tax bands still apply: 20% on the first £37,700 of taxable pay, 40% up to £125,140, and 45% above that. Unlike BR (flat 20%), 0T can therefore charge higher and additional rates on a single income source.
- Why have I been given tax code 0T?
- The most common reasons are: (1) you started a new job without providing a P45 or completing the starter checklist; (2) your income has tipped over £125,140 and the personal allowance has fully tapered away; (3) HMRC has no record yet of your new income source and is applying 0T as a holding code; or (4) you have a second PAYE source where HMRC suspects the basic-rate band has already been used up.
- Is 0T the same as BR?
- No. Both give zero personal allowance, but BR fixes the rate at 20% on every pound. 0T applies the full UK band ladder — so pay above £37,700 will be taxed at 40%, and above £125,140 at 45%. On a high salary, 0T can produce much more tax than BR.
- How much tax does 0T imply on £30,000?
- On 0T, all £30,000 is taxable. The first £37,700 of taxable pay falls in the basic-rate band, so PAYE is £30,000 × 20% = £6,000 a year. Compared with 1257L at the same salary (£3,486), that is £2,514 more PAYE — exactly the value of the lost £12,570 allowance at 20%.
- How do I fix tax code 0T?
- If 0T is on your only or main job and you do not earn over £125,140, it is usually wrong. Provide your employer with a P45 from the previous job or complete a starter checklist confirming this is your only / main job. Sign in to your HMRC personal tax account to confirm the code, or call HMRC PAYE on 0300 200 3300. HMRC will normally re-issue 1257L cumulative.
Related reading
- Tax code BR — flat 20% no allowance
Sibling of 0T but capped at the basic rate.
- Tax code 1257L — full allowance
The normal code 0T should usually be replaced with.
- Tax code M1 — emergency Month-1 basis
Often paired with 0T after job changes.
- Every UK tax code, explained one page at a time
The full tax-code index hub.
- Wrong tax code checker
Run a guided check on the current code.
Last reviewed
Last reviewed:
Next review:
Reviewed each tax year and sooner if HMRC changes 0T / starter-checklist rules.
Educational guidance only — not regulated tax, financial or payroll advice. Always verify with HMRC or your payroll team before acting. To run a real check, the wrong-tax-code checker is the place to begin.