Second Job Tax Code 2026/27: Why You're Taxed at Basic Rate From the First Pound
Your second job usually comes with a BR tax code, meaning every pound is taxed at 20% with no Personal Allowance applied — even if you're not actually a higher earner overall. Here's how it works and when to ask HMRC to fix it.
Why BR Codes Exist
Every UK taxpayer has one Personal Allowance (£12,570 for 2026/27) — it isn't multiplied by the number of jobs you hold. HMRC's default system assigns your full Personal Allowance to whichever job it identifies as your main employment (usually your first or highest-paying job), via a standard tax code like 1257L. Any additional job then typically receives a BR (Basic Rate) tax code, meaning:
| Feature | Main job (1257L) | Second job (BR) |
|---|---|---|
| Personal Allowance applied | Full £12,570 | None |
| Tax rate on income | 0% up to £12,570, then 20%/40%/45% as normal | Flat 20% on all income |
| Purpose | Reflects the standard tax bands | Assumes Personal Allowance already used elsewhere |
This isn't a penalty for having two jobs — it's simply how the single Personal Allowance is defaulted across multiple employments where HMRC doesn't have more specific instructions.
Does This Mean You're Overpaying?
Often, no — or only marginally. Because your Personal Allowance is being used in full against job one, and job two is taxed at a flat 20% (which is also the basic rate that would apply to most income in that range anyway), the combined tax paid across both jobs frequently lands close to what you'd owe if the same total income were earned in a single job — provided your combined income stays within the basic-rate band overall.
Example: Job one pays £18,000/year, job two pays £8,000/year, total £26,000.
| Job | Code | Tax paid |
|---|---|---|
| Job one (£18,000) | 1257L | Tax on £18,000 − £12,570 = £5,430 at 20% = £1,086 |
| Job two (£8,000) | BR | Tax on full £8,000 at 20% = £1,600 |
| Total tax paid | — | £2,686 |
Compare to a single job paying £26,000: tax on £26,000 − £12,570 = £13,430 at 20% = £2,686 — identical. In this case the split allocation, despite looking odd on two separate payslips, produces exactly the right total.
When It Genuinely Goes Wrong
The default allocation can produce a meaningfully wrong result in specific situations:
| Scenario | What happens |
|---|---|
| Job one (allocated the Personal Allowance) pays very little, e.g., a few hours a week | Most of the £12,570 allowance goes unused against job one, while job two is still taxed at flat 20% with no allowance — you may be overpaying overall |
| Job one is actually the smaller job, job two the larger one, but HMRC's system has them reversed | The allowance may be sitting against the "wrong" (smaller) job |
| Combined income is genuinely below the Personal Allowance overall (e.g., two small part-time jobs totalling under £12,570) | Job two's flat 20% BR tax means you overpay, since your total income wouldn't actually be taxed at all if earned in a single job |
In these cases, the BR code on job two is deducting tax that, viewed across your whole income, you don't actually owe — until reconciled.
Asking HMRC to Reallocate
If your situation looks like one of the mismatches above, you can contact HMRC (via your personal tax account online, by phone, or by post) and ask them to:
- Confirm which job should hold the Personal Allowance (usually your genuinely larger/main job), and
- Split the allowance differently if it suits your circumstances better — for example, applying a portion of the £12,570 to each job rather than all to one.
HMRC will issue updated tax codes to both employers, adjusting future deductions. Over- or under-payments from earlier in the tax year are typically reconciled automatically at year end (or sooner via a P800 calculation), but proactively fixing the code going forward avoids the issue continuing to compound through the rest of the tax year.
The National Insurance Wrinkle
Unlike income tax and the Personal Allowance, National Insurance thresholds are applied separately to each job by each employer — they aren't automatically combined. This means someone with two moderate-paying jobs can sometimes pay less total employee NI than someone earning the identical combined amount in a single job, because each individual job's earnings partially fall under the NI primary threshold (£12,570 for 2026/27) separately.
Unlike income tax, this isn't automatically reconciled through the tax code system — if you believe you've overpaid NI due to holding multiple jobs across a tax year, you may need to make a specific claim to HMRC for a refund of excess NI, rather than expecting it to correct itself automatically.
Quick Checklist for Anyone Starting a Second Job
- Check the tax code shown on your second job's first payslip — BR is normal and expected by default.
- Estimate your combined annual income from both jobs to judge whether the default allocation looks broadly right.
- If your main/larger job isn't the one holding the Personal Allowance, or your combined income is low enough that BR is clearly over-taxing you, contact HMRC to review and adjust the codes.
- Keep an eye on National Insurance separately, since it isn't automatically reconciled across multiple jobs the way income tax is.
Frequently asked questions
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