See below helpful information about the current financial year PAYE tax and NI bandings.
PAYE and National Insurance Bandings
For information on the current rates and earnings thresholds for PAYE and NICs, please visit the HMRC links below:
- England, Wales and Northern Ireland - https://www.gov.uk/income-tax-rates
- Scotland - https://www.gov.uk/scottish-income-tax
- National Insurance - https://www.gov.uk/national-insurance
Tax code
Your tax code is used by NASA Umbrella to determine how much PAYE Income Tax needs to be deducted from each payslip.
The standard tax code for this financial year is 1257L.
The amount of annual gross pay that is tax free is determined by the number in your tax code. For example, if your tax code is 1257L then you can earn £12,570 tax free in the 2024-2025 financial year.
Where possible you should try to obtain your P45 from your most recent employer each time you start a new employment.
A second and important part of your tax code is the basis which will determine how NASA Umbrella deduct the PAYE Income tax.
Tax codes will only have two different formats:
Cumulative – this means that NASA Umbrella are aware of your full earnings for the financial year and will be able to charge PAYE Income Tax according to your earnings at each stage of the year. This type of tax code will ensure that your tax is always up to date and will notice any large gaps in employment – resulting in a potential tax refund in the next available payslip.
This tax code will be shown as ‘1257L’ on your payslips (or any other number if your annual tax-free allowance is different)
Week1Month1 – this means that NASA Umbrella are not aware of your full earnings for the financial year and will only be able to charge PAYE Income Tax based on your weekly or monthly earnings. This tax code will not detect any potential tax refunds.
This tax code will be shown as ‘1257L X’ on your payslips (or any other number if your annual tax-free allowance is different)
Extra tax codes to mention (England & Wales):
BR – This stands for ‘Basic Rate’ and flat 20% PAYE Income Tax deductions will be made on your taxable pay each payslip
D0 – This stands for ‘Higher Rate’ and flat 40% PAYE Income Tax deductions will be made on your taxable pay each payslip
D1 - This stands for ‘Additional Rate’ and flat 45% PAYE Income Tax deductions will be made on your taxable pay each payslip
0T – This means that you will have no tax-free allowance and PAYE Income Tax deductions will be at 20% and possibly 40%/45% respectively (if your earnings are high enough)
K – This means that you will have no tax-free allowance and HMRC have used extra calculations to determine that further tax is owed (this could be for a number of reasons that HMRC will be able to advise on)
Note: Your tax-free allowance is reduced by £1 for every £2 that your adjusted taxable income is above £100,000. This means your allowance is zero if your taxable income is £125k or above (if on the standard 1257L tax code).
HMRC may make adjustments to your tax code during, or at the end of the financial year, if they expect you to surpass the £100k earnings threshold.
Not sure about your tax code?
If you think your tax code may be incorrect, it is always best to contact HMRC directly. They are then able to check their systems, provide you with their reasoning and if required they can send us an updated tax code for you electronically. We usually receive tax code amendments within 7 days of HMRC confirming the change to you. The details you will need are as follows:
- Phone: 0300 200 3300
- NASA Umbrella Employer Reference: 034/RA30677 + Your National Insurance number