0T Tax Code: Why you have zero tax-free allowance

For the 2026/27 tax year, most workers in the UK are entitled to a tax-free Personal Allowance of £12,570. This means you shouldn't pay any Income Tax on the first £1,047 you earn each month.

However, if your payslip says 0T, HMRC has instructed your employer to give you zero allowance. From the very first pound you earn, you are losing 20% to the taxman. If you earn over the higher rate threshold, you will lose 40%.

Why has HMRC put me on a 0T code?

HMRC doesn't use the 0T code to punish you. They use it when they simply don't have enough information about your income, or when they believe you have already used up your £12,570 tax-free allowance somewhere else. This usually happens in three scenarios:

1. You just started a new job without a P45

If you start a new job and fail to hand in a P45 from your old employer, AND you fail to fill in a "New Starter Checklist", the payroll department has no idea what your tax status is. By law, if you don't provide this paperwork before the first payroll run, they are legally forced to put you on the 0T code to ensure tax is collected.

2. You have a second job

You only get one tax-free Personal Allowance. If you have two jobs at the same time, HMRC usually applies your full £12,570 allowance to your main job (using code 1257L). Your second job will then be given a BR (Basic Rate) or 0T tax code to ensure you don't get the tax-free allowance twice.

3. You earn over £100,000 a year

If your salary (or a massive bonus) pushes your earnings over £100,000, HMRC starts taking away your £12,570 Personal Allowance. For every £2 you earn over £100,000, you lose £1 of allowance. Once you hit £125,140, your entire allowance is gone, and HMRC will officially change your tax code to 0T to reflect this.

How to fix a 0T Tax Code

If this is your main or only job, and you earn less than £100,000, the 0T code is a mistake. You need to fix it immediately to get your £209 a month back.

Step 1: The fast way (if you just started)

If you are a new starter, walk directly to your HR or Payroll department and hand them a completed HMRC Starter Checklist (you can download it for free from Gov.uk). Make sure you tick "Statement B" (This is now my only job, but since 6 April I have had another job). This will allow payroll to legally switch you off 0T.

Step 2: The guaranteed way (Call HMRC)

If you've been working there for months and are stuck on 0T, your employer cannot fix it themselves—they need HMRC's permission. You must call HMRC on 0300 200 3300.

Tell the agent: "My employer has put me on a 0T tax code, but this is my only job and I am entitled to my Personal Allowance. Can you send an electronic coding notice to my employer to fix this?" HMRC will press a button, and within 48 hours, your employer's payroll software will automatically update to 1257L.

Will I get the stolen tax back?

Yes. If you fix the tax code during the current tax year (before April 5th), the PAYE system will auto-correct on your very next payslip.

Because PAYE is cumulative, the payroll software will look at the months you were on 0T, realise you were overtaxed by hundreds of pounds, and refund all the money directly into your bank account alongside your normal wages. (This will show up as a negative tax figure on your payslip).

If you don't fix it before the tax year ends in April, you will have to wait for HMRC to mail you a P800 refund cheque in the summer.

Frequently Asked Questions