BrassTax news

BR no more: changes to emergency code

From 6 April there will be changes to the "emergency code" which employers are required to use where no "real" code is available. Perhaps the most common use of the "emergency code" is where a new employee cannot provide a P45 and has other employment; but it is also relevant where payments are made after the employment has ended and P45 has been issued.

At present employers must use code "BR", which requires tax to be deducted at the basic rate. From 6 April the appropriate code will be "0T", which requires tax to be deducted at basic and higher rates where appropriate. The extent to which this will make a difference to the tax deducted will depend both on the size of the payment and the time in the tax year when the payment is made – payments made early in the tax year, when only a relatively small proportion of the basic rate band is available to be taken into account under code 0T will be most affected.

For further advice on this or other PAYE matters please contact help@bkltax.co.uk or call us on 0208 922 9317.