Will I start next tax year with a K code if I’m on one right now?

[peteza]

I wonder if that title is specific enough for the fussy bot.
I changed employers in Sept last year, HMRC kept overestimating my income thinking I was working the old job as well (despite having received my P45) Eventually arrived at a tax code they later decided was too low. Ended up on a K code and clobbered for tax for the rest of the year. (there was no bonus or other income that resulted in underpayment, I’ve truthfully stated my correct gross salary) It is what it is but I don’t want to start the new tax year with a K code. My understanding is that the K code is to ensure I pay correct tax in the current year without impacting next tax year.
Will I start next tax year with a normal tax code? Or do I have to do something to ensure this.
Please feel free to explain stuff like I’m 5, I absolutely hate our tax system and barely understand it even tho I’m gen X age group.
Thank you!

 

[soulier32]

@peteza

My understanding is that the K code is to ensure I pay correct tax in the current year without impacting next tax year.

The K code simply means your entire tax free allowance has been wiped off the code and has gone into 'negative'. Has nothing to with next year's code.

However, generally when it comes to ANY tax code reduction for when they estimate you've not paid enough tax for the current tax year, it'll try to sort it out this year rather than letting it carrying on into the next. The later in the tax year this happens, the smaller timeframe they have to collect it so the hit to the tax code is greater (eg; £1K spread over 3 months instead of 12)

For next year, go here https://www.gov.uk/personal-tax-account and ensure your estimated income and any employment benefits you may have are correct.

They generally do start setting out next year's codes before April so keep an eye out in your tax account and you should have notice of what tax code you'll be on in April.

 

[peteza]

@soulier32 !thanks

 

[peteza]

@soulier32 Ah now thats a confusing one for me, when I entered the info for my current employment HMRC told me to put in a figure I’d earn for the current tax year. Because its a part year that figure isn’t going to be correct for the new tax year. Do I keep an eye out for that new code then enter a full year taxable income? I don’t want to change the current year taxable income figure as my tax code might change again.
Maybe I should just start a new job on 6 April haha

 

[carrico]

@peteza The K code is a negative tax code that is used to reclaim underpaid tax that exceeds what can be reclaimed through the removal of personal allowance (eg if you already have a reduced or zero PA).

Assuming the payments taken this year are enough to reclaim the underpayment then yes, you will return to your standard tax code from april