The numbers represent how much you earn tax free, which is just the private allowance that is about as £12,570.
The letters relate to a taxpayer’s situation and the way it alters the private allowance. Tax codes start with an “S” in Scotland and a “C” in Wales.
The next letters in a tax code all signify various things:
L – Basic personal allowance for somebody born after April 5, 1948
0T – No personal allowance
BR – All income from this source is taxed at the fundamental rate
DO – All income from this source is taxed at the upper rate
D1 – All income from this source is taxed at the extra rate
K – Total deductions exceed their allowances
M – Marriage Allowance receiving 10 percent of their spouse or civil partners’ personal allowance
N – Marriage Allowance providing 10 percent of their unused personal allowance to their spouse or civil partner
NT – No tax is due on this income
C – Paying income tax in Wales
S – Paying Scottish rate of Income Tax in Scotland
T – Tax office must review the tax code or to maintain personal details confidential
W1 or M1 – Emergency tax codes for week one or month one depending on when an individual gets paid.
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