Pillar Guide / Updated June 2026
UK Second Job and Multiple Employment Tax: How PAYE, Allowance and NI Work 2026/27
Taking a second job does not magically increase your tax rate -- but the way PAYE splits your income across two payrolls confuses thousands of people every year. The most common worry, "my second job is taxed at 20% with no allowance", is usually correct, but not always. This 2026/27 guide explains how your personal allowance is allocated, what BR, D0 and D1 codes mean for a second job, how National Insurance is charged separately by each employer, and how to make sure you neither overpay nor underpay.
Key second-job tax facts -- 2026/27
- Personal allowance: GBP 12,570 total across all jobs, not per job
- Typical second-job code: BR (20% on all earnings)
- Higher earners: D0 (40%) or D1 (45%) on the second job
- National Insurance: 8% then 2%, assessed per job separately
- Allowance split: available if main job pays under GBP 12,570
- Self-employed second income: via Self Assessment, not PAYE
A Second Job Is Not Taxed More
The single most important point is that a second job does not attract a higher tax rate just for being a second job. You are taxed on your combined income at the normal bands -- 20% up to GBP 37,700 of taxable income, 40% above the GBP 50,270 higher-rate threshold, and 45% above GBP 125,140. The reason a second job often looks heavily taxed is that your tax-free personal allowance of GBP 12,570 has usually already been given to your main job, so none is left for the second.
The challenge is administrative: each employer runs its own PAYE and only sees the pay it gives you. HMRC coordinates this by assigning a tax code to each job. Get the codes right and your total tax is exactly correct.
How Your Allowance Is Allocated
You have one personal allowance of GBP 12,570 for the year, shared across all your income -- not GBP 12,570 per job. HMRC decides which job is your "main" employment and normally gives that job the full allowance via a 1257L code. The second job then gets a code with no allowance, because using allowance twice would leave you underpaying.
This default works well when your main job pays more than GBP 12,570. It only causes a problem when your main job pays less, leaving unused allowance that the rigid default does not pass to the second job.
BR, D0 and D1 Second-Job Codes
The code on your second job depends on which band your main income reaches:
- BR: all second-job income taxed at 20%. Correct when your main job uses the allowance but stays within the basic band.
- D0: all second-job income taxed at 40%. Correct when your main salary is above the GBP 50,270 higher-rate threshold.
- D1: all second-job income taxed at 45%. Correct when your main income exceeds GBP 125,140.
If your second job is on BR but your main salary is GBP 60,000, you would be underpaying because the second job should be at 40% -- so HMRC may move it to D0.
Splitting Your Allowance
If your main job pays less than GBP 12,570, the spare allowance is being wasted on a BR second job. You can ask HMRC to split your allowance across both employments. For example, with a GBP 9,000 main job you might keep GBP 9,000 of allowance there (code 900L) and move GBP 3,570 to the second job (code 357L), so part of the second job is tax free too. Request this through your Personal Tax Account or by contacting HMRC.
National Insurance Across Jobs
National Insurance is not pooled across employers. Each job assesses NI separately: 8% on earnings between GBP 12,570 and GBP 50,270 a year that exceed the per-period threshold in that job, then 2% above. Because the threshold applies per job, two jobs each below GBP 50,270 could both charge 8%, even though a single job paying the same combined amount would partly fall into the 2% band.
There is an annual maximum amount of employee NI across all jobs. If you pay more than the maximum because of multiple employments, you can apply to HMRC for a refund after the tax year ends.
Second Income from Self-Employment
A side income from self-employment is handled completely differently from a second PAYE job. It is not taxed through any employer code; instead you report the profit on a Self Assessment return and pay income tax plus Class 4 NI -- 6% on profits between GBP 12,570 and GBP 50,270, then 2%. Your allowance is set against employment income first, with any remainder reducing the self-employed profit.
Worked Examples
Example 1 -- main job GBP 30,000, second job GBP 6,000, second on BR.
- Main job 1257L: GBP 30,000 - GBP 12,570 = GBP 17,430 taxed at 20% = GBP 3,486.
- Second job BR: GBP 6,000 taxed at 20% = GBP 1,200.
- Total tax GBP 4,686. Combined taxable income GBP 36,000 - GBP 12,570 = GBP 23,430 at 20% = GBP 4,686 -- the codes are correct.
Example 2 -- main job GBP 9,000, second job GBP 9,000, second on BR (wasted allowance).
- Main job 1257L: GBP 9,000 is under GBP 12,570, so no tax -- but GBP 3,570 of allowance is wasted.
- Second job BR: GBP 9,000 taxed at 20% = GBP 1,800.
- Correct position: combined GBP 18,000 - GBP 12,570 = GBP 5,430 at 20% = GBP 1,086.
- Overpaid by GBP 714 until the allowance is split -- which HMRC then refunds.
Use a take-home pay calculator to model both jobs together and confirm the codes add up.
Avoiding Overpayment
A few simple checks keep your multiple-employment tax correct:
- Tell HMRC which job is your main employment.
- Make sure the allowance across all codes totals GBP 12,570 -- no more, no less than you can use.
- Request an allowance split if your main job pays under GBP 12,570.
- Watch for being on an emergency code that wrongly gives allowance twice.
- Claim an NI refund after year end if multiple jobs pushed you over the annual maximum.
This guide is general information, not financial advice. Check your codes in your Personal Tax Account and see gov.uk for your circumstances.