Emergency tax refund estimator
A month-1 emergency code can take too much tax from your first payslips at a new job. This estimates how much you have overpaid and how the refund reaches you.
Why the emergency code over-taxes you
PAYE normally spreads your £12,570 personal allowance evenly across the year, about £1,047 a month. When you are on a cumulative code, any allowance you did not use in earlier months is given back the moment you start being paid. A month-1 emergency code does not do that. It treats each payslip in isolation, so the allowance from the months before you started work simply goes unused while the code stays in place.
That is why starting a job partway through the year is the classic case. If you began work in the autumn after a gap, you had several months of allowance sitting idle, and the emergency code taxes you as though you had been earning at that rate all along. The tool compares the tax an emergency code takes with the tax you actually owe on what you have earned, and the difference is what should come back.
Worked example
Suppose you start in October on £3,000 a month. Across the 6 months to the end of the tax year you earn £18,000. The emergency code takes £391 a month, £2,343 in total. The correct tax on £18,000 for the year is only £1,086, because you get the full personal allowance. The gap of £1,257 is refunded once you are moved onto a normal code, or after the tax year through a P800.
Common questions
What is an emergency tax code?
An emergency code, such as 1257L followed by M1, W1 or X, taxes each pay packet on its own rather than across the whole year. It is used when your employer does not have full details, for example when you start without a P45. It gives you the personal allowance, but only one month at a time.
Why do I overpay on an emergency code?
A month-1 code does not hand back the allowance you built up in the months before you started. If you were not paid earlier in the tax year, that unused allowance is lost while you stay on the emergency code, so more tax comes out than you really owe.
How much emergency tax will I get back?
In the example, starting in October on £3,000 a month, you overpay about £1,257. The figure depends on how many months of unused allowance you had before starting and your pay level.
When is the refund paid?
Once HMRC puts you on a normal cumulative code, usually within a month or two of getting your details, the overpaid tax is repaid automatically through your pay. If it is not corrected by the end of the tax year, HMRC works it out and sends a P800 tax calculation, then a refund.
Do I need to claim it?
Usually not. Most emergency-tax overpayments correct themselves through PAYE. If the tax year has ended and you have not had a refund, you can check and claim through your Personal Tax Account on gov.uk.