0T Tax Code: What It Means and How to Get Your Allowance Back

What Does the 0T Tax Code Mean?

A 0T tax code gives you no tax-free Personal Allowance on that job or pension. Your income is taxed from the first pound at the normal rates — 20% on the basic-rate band, then 40% and 45% — rather than getting the first £12,570 tax-free as you would on 1257L in 2026/27.

0T is correct if your allowance has genuinely been used up elsewhere or you have lost it because of high income. It is often wrong when it has been used simply because your employer or HMRC did not have enough information about you.

Why You Might Be on 0T

• You started a job without a P45 and did not complete a starter checklist. If your employer has no information about your circumstances, it must use 0T on a non-cumulative basis until HMRC sends a code.
• Your Personal Allowance is used by another job or pension. HMRC may use 0T (rather than BR) on a second source where it wants tax charged across the full range of rates.
• Your income is above £125,140. The Personal Allowance is withdrawn by £1 for every £2 of adjusted net income over £100,000, so at £125,140 it is gone entirely. In that case 0T can be correct on your main job.
• HMRC has reduced your allowance to nothing to collect tax on benefits in kind, untaxed income or underpaid tax from a previous year. If the reductions are larger than the allowance you would normally see a K code instead.

0T vs 0T W1 or 0T M1

The suffix matters:

• 0T (cumulative) — tax is worked out on your total pay since 6 April. You still get no allowance, but if your code is later corrected, the overpaid tax for the year is refunded through payroll.
• 0T W1 or 0T M1 (non-cumulative) — each week's or month's pay is taxed on its own. This is an emergency basis. Payroll cannot refund the year's overpayment until HMRC replaces it with a cumulative code.

New starters without a P45 or starter checklist usually get 0T on a non-cumulative basis. That is the most expensive position to be in, so it is worth acting quickly.

Worked Example

Tom starts a new job paying £3,000 a month and does not fill in the starter checklist. His employer uses 0T M1.

• On 0T M1, the full £3,000 is taxed with no allowance: roughly £600 a month in Income Tax.
• On 1257L, about £1,047 of each month's pay would be tax-free, so tax would be about £390 a month.

He overpays about £210 a month until HMRC issues a correct code. Because M1 is non-cumulative, he does not get the overpayment back until his employer receives a cumulative code — which is why fixing the underlying record matters more than waiting. (Illustrative figures; National Insurance is unaffected by the code.)

How to Fix a 0T Code

1. Give your employer your P45 from your previous job, or complete the starter checklist if you have not already.
2. Check your personal tax account or the HMRC app to see which job or pension HMRC has allocated your allowance to, and close any jobs that have ended.
3. Correct your estimated income if HMRC thinks you will earn more than £100,000 when you will not — an inflated estimate can lead HMRC to reduce or remove your allowance.
4. Contact HMRC by phone if you cannot make the change online.

When a correct cumulative code arrives, overpaid tax for the current year is normally refunded through payroll. Overpayments in earlier years are usually picked up by HMRC after the year ends and refunded through a P800 — see our guide on how to claim a tax refund.

0T for High Earners

If your income is above £125,140, 0T on your main employment is usually right. Between £100,000 and £125,140 the allowance taper produces an effective marginal Income Tax rate of 60%, because you pay 40% tax while also losing allowance. Personal pension contributions and Gift Aid reduce your adjusted net income and can restore some or all of the allowance. This is one of the most valuable planning areas for London professionals — our tax planning team can model the options, and our income tax calculator shows the taper in action.

0T on Pensions and Lump Sums

Pension providers often apply 0T or another emergency code to the first taxable payment from a pension pot, because they have no tax code from HMRC for you yet. With a large one-off withdrawal, the result can be a substantial over-deduction, because the provider treats the payment as though it will be repeated every month.

If you are not taking further payments in the same tax year, you do not have to wait for HMRC to reconcile your tax after 5 April. You can claim the overpaid tax back during the year using the form HMRC provides for flexible pension payments. If you are taking regular payments, the provider will normally receive a cumulative code from HMRC and any overpayment is refunded through later payments.

0T vs K Codes

Both 0T and K codes mean you have no tax-free allowance on that source of income, but they are different:

• 0T means your allowance is zero. Every pound of income is taxable at normal rates, but nothing extra is added.
• K codes go further: HMRC adds an amount to your taxable pay because the deductions from your allowance — for example benefits in kind or State Pension — are larger than the allowance itself. A K code can collect more tax than 0T, subject to the rule that no more than half of your pay in a period can be taken as tax.

If you have moved from a K code to 0T, or the other way round, the usual reason is that a benefit in kind has started or ended, or HMRC's estimate of your untaxed income has changed. Check the reasons shown in your personal tax account.

What Happens at the End of the Tax Year

Once the tax year ends, HMRC compares the tax deducted with the tax due on your total income. If 0T led to an overpayment that was not refunded through payroll — for example because you left the job while still on 0T M1 — you should receive a P800 calculation. If you are in Self Assessment, the overpayment is picked up through your return instead. Either way, keep your P45s, P60s and final payslips, because those are what you need to check HMRC's figures.

A Note on Scottish and Welsh Taxpayers

If you live in Scotland your code will read S0T, and if you live in Wales C0T. The meaning is the same — no Personal Allowance — but Scottish taxpayers pay Scottish rates on the income.

Frequently Asked Questions

Is 0T the same as emergency tax?

0T W1 or 0T M1 is an emergency, non-cumulative code. 0T without a suffix is cumulative and can be a deliberate code rather than an emergency one.

Will I get the tax back automatically?

Usually yes, once the correct code is in place — through payroll for the current year, or by a P800 after the year ends. It does not happen until HMRC has the right information, so update your details.

What is the difference between 0T and BR?

Both give no allowance. BR taxes everything at 20%; 0T applies the normal bands, so higher-rate tax can apply once your pay from that source passes the basic-rate band.

Can 0T appear on my pension?

Yes, typically when you first draw a pension or take a lump sum and the provider has no code from HMRC yet.

Get Your Tax Code Sorted

See our hub guide to tax codes explained for all the other codes. If you are losing money to a 0T code, or you are a high earner caught in the £100,000–£125,140 trap, our tax advisers can help. Contact us for a free consultation.