Answers · UK 2025/26

What is a BR tax code and why have I been given one?

A BR tax code means all your income from that job or pension is taxed at the Basic Rate (20%), with no Personal Allowance applied at all. It is most commonly used for a second job or pension, on the assumption your full tax-free allowance has already been used against your main income.

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Full answer

"BR" stands for Basic Rate, and it is one of the simplest tax codes HMRC issues, though it often causes confusion because it can result in noticeably more tax being deducted than expected. Unlike a standard code such as 1257L, which gives you £12,570 of tax-free Personal Allowance before any tax is charged, a BR code applies the 20% basic rate to every pound of income from that source, right from the first pound, with no tax-free portion at all. BR codes are most commonly applied to a second job or a second pension, on the assumption that your Personal Allowance has already been fully used against your main source of income -- an assumption that is correct for many people, but not for everyone. If your main job actually pays less than £12,570 a year, some of your Personal Allowance may be going unused there while your second job is taxed at 20% from the first pound, meaning you are overpaying tax overall and could ask HMRC to split your Personal Allowance more appropriately between your two sources of income. A BR code is also sometimes used temporarily when you start a new job without a P45 and your employer does not have enough information to apply an emergency 1257L code instead, though this is less common than the second-job scenario. If you think a BR code is wrong for your circumstances, you can update your employment details through your personal tax account or contact HMRC directly, and any overpaid tax from earlier in the year will usually be refunded automatically once your code is corrected, since PAYE codes are generally applied cumulatively.