What to do if your tax code is wrong?
Tax codes are used by HM Revenue & Customs (HMRC) to calculate how much Income Tax should be deducted from your salary or pension. Most of the time, your tax code is correct and reflects your personal allowance and income. However, sometimes errors can occur. An incorrect tax code can lead to underpaying or overpaying tax, which can cause unnecessary stress and financial complications. If you’ve noticed something unusual or have been informed that your tax code is wrong, it’s essential to act quickly and resolve the issue. In this article, we’ll guide you through the steps you need to take, answer common concerns, and explain how tax codes work. How do you know if your tax code is wrong? The first sign that your tax code is incorrect is usually a change in your take-home pay. If you notice that your salary has dropped without reason, it might be due to an incorrect tax code. For example, if you’re being taxed on more income than you should be, or you’re on an emergency tax code, th...