Tax code change

[dillon21]

Good Afternoon

not sure I’m in the correct place but just received notification from employer  my husband as just gone back to work after shielding we are on UC he’s only doing part time but his tax cone as gone from 1250 BR to 605 T could anyone explain why this would be  nothing’s changed since before covid apRt from claiming uc
thank you  

 

[honeybee13]

Hi.

 

Site team member Slick132 is good at tax questions. Hopefully they'll be along later.

 

HB

[rapster01uk]

Is the 1250BR his code from before shielding?

 

Before shielding, the tax code would have been 1250 as this is the personal amount allowed to earn before tax. It should then have been followed by a single letter.

The BR at the end means it is an emergency tax code, and that you receive no PFA, this is usual if you have more than one source of income.  This code means that all the earnings from this income will be taxed.

 

The 605T code is a temporary code, and shows that your tax is still being reviewed.

 

The changes in codes is due to the change in circumstances, firstly he was in work, then claiming UC while shielding (unpaid I assume), and then going back to work again.

 

They should sort themselves out, but you can always sign up to HMRC and keep an eye on the codes yourselves, and query anything with them as well.

[dillon21]

Sorry it was 1250l before shielding he 

[rapster01uk]

It's not so bad then.  1250L is the standard tax code, and means he can earn £12500 pounds without paying tax, and then just pay tax on anything he earns over that amount.

 

Due to technically being out of work, and claiming UC, and now going back to work, the code is saying that he will pay tax on anything earned over £6500 pounds now, but it is under review and should change within the next 8-12 weeks, and if he has overpaid in the meantime, then it will be refunded via his paycheck.

 

The only reason for this is I am assuming that while shielding, his company did not keep him on the books.  If HMRC have got a record of him being on the books, and claiming UC, this will be them determining that he hasn't been trying to fraud the system by being paid as employed at the same time as claiming UC.  Once they clear that up, then they will correct the tax code.  So long as all his earnings and benefits all add up and they are happy then it will be back to normal.

[dillon21]

Thank you so much for explaining that to me much appreciated