What is an emergency tax code?

Definition of emergency tax code

An emergency tax code is a type of tax code that HMRC can attribute to an employee when it does not have enough information about the employee to assign them to the correct tax code.

Being assigned to an emergency tax code sometimes results in the employee having to pay a higher rate of tax than they might otherwise have to pay.

Disclaimer: The content included in this glossary is based on our understanding of tax law at the time of publication. It may be subject to change and may not be applicable to your circumstances, so should not be relied upon. You are responsible for complying with tax law and should seek independent advice if you require further information about the content included in this glossary. If you don't have an accountant, take a look at our directory to find a FreeAgent Practice Partner based in your local area.

Frequently Asked Questions

Why might HMRC assign an employee to an emergency tax code?

HMRC assigns employees to an emergency tax code when it doesn’t know enough about them to apply the correct tax code. This happens most commonly when an employee:

  • starts a new job
  • returns to paid employment after being self-employed
  • starts receiving company benefits or the State Pension

How long does an emergency tax code stay in place?

Emergency tax is usually a temporary measure. HMRC will automatically correct an employee’s tax code after it receives the information it requires. This usually happens when the new employer sends the employee’s P45 to HMRC.

If an employee is overcharged any tax as a result of being placed on an emergency tax code, HMRC usually provides a rebate for the overcharged amount. If you’re an employee and believe you’re being charged the wrong amount of tax, you should speak to your employer or contact HMRC to resolve the situation.

How can I find out if I’m on an emergency tax code?

You’ll be able to see if you’re on an emergency tax code by looking at your most recent payslip. You can find more information about which emergency tax codes to look out for on HMRC’s website.

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