ICAEW.com works better with JavaScript enabled.

TAX NEWS

Check what your tax code means with HMRC’s online tool

Article

Published: 28 Jul 2023 Update History

HMRC has released a new online tool to help taxpayers understand what their tax code means.

Tax codes are used by HMRC to tell an employer how much income tax to withhold through the PAYE system. A person’s tax code may change based on their personal circumstances. If it does, HMRC will inform the taxpayers of their new tax code by post or through their personal tax account. 

The online tool is designed to explain a taxpayer’s tax code or why their tax code may have changed.  

To check what a tax code means, a taxpayer will need their tax code and an estimate of their annual income. Depending on their individual circumstances, they may also need details of benefits provided by their employer or their state pension amount. 

Due to gaps in information received by HMRC, a person’s tax code may over or under collect tax on their income. Issues most commonly arise where an individual has multiple jobs, starts or stops receiving a taxable benefit, or moves jobs. 

The new online tool also directs taxpayers to the relevant service to change their tax code in specific instances. More generally, if a taxpayer needs to change their tax code, they can use the Check your Income Tax online service. Unless specifically authorised by the employee, employers are not able to change their employees’ tax codes.  

The tool is newly released and HMRC welcomes feedback on user experiences of the tool. There is an invitation to provide feedback when users have reached the ‘What your tax code means’ screen at the end of the tool. 

The Tax Faculty

ICAEW's Tax Faculty is recognised internationally as a leading authority and source of expertise on taxation. The faculty is the voice of tax for ICAEW, responsible for all submissions to the tax authorities. Join the Faculty for expert guidance and support enabling you to provide the best advice on tax to your clients or business.

More support on tax

ICAEW's Tax Faculty provides technical guidance and practical support on tax practice and policy. You can sign up to the Tax Faculty's free enewsletter (TAXwire) which provides weekly updates on developments in tax.

Sign up for TAXwireJoin the Tax Faculty

More from the Tax Faculty

Latest news
Making tax digital image
TAXwire

Stay up to date with the latest developments in tax by signing up to the Tax Faculty's weekly e-newsletter

Practical guidance
Cover
TAXline

Comprehensive support for Tax practitioners each month from the Tax Faculty and expert contributors.

Technical support
Tax Faculty image
Webinars

Expert advice from the Tax Faculty's technical managers on all the developments in tax policy and practice.

Open AddCPD icon

Add Verified CPD Activity

Introducing AddCPD, a new way to record your CPD activities!

Log in to start using the AddCPD tool. Available only to ICAEW members.

Add this page to your CPD activity

Step 1 of 3
Download recorded
Download not recorded

Please download the related document if you wish to add this activity to your record

What time are you claiming for this activity?
Mandatory fields

Add this page to your CPD activity

Step 2 of 3
Mandatory field

Add activity to my record

Step 3 of 3
Mandatory field

Activity added

An error has occurred
Please try again

If the problem persists please contact our helpline on +44 (0)1908 248 250