Martin Lewis explains what an ‘X’ on your pay slip could mean – and why it might be costing you money
- Martin Lewis and his team of experts offered advice on emergency tax codes
- They said to watch out for a letter at the end of your code, such as an ‘X’ or ‘M1’
- People are often placed on emergency tax codes when they start a new job
Finance expert Martin Lewis has urged those with an ‘X’ on their pay slip to check they are on the right tax code – as the mistake could be costing them hundreds.
He addressed the matter on his ITV Money Show Live, after a viewer queried whether she might be entitled to a tax rebate as she believes she was overtaxed by £800.
Tina said: ‘I’m on a 16 hour contract and last month I did lots of overtime. I was put on the basic rate temporarily and overtaxed by more than £800.
‘My tax code is now back to 1257L, but I’m short £500, worrying about money. Will I get a tax rebate?’ vcvvf cc
Finance expert Martin Lewis has urged those with an ‘X’ on their pay slip to check they are on the right tax code – as the mistake could be costing them hundreds
Martin passed the question to tax expert Rebecca Benneyworth, who explained the matter depends on whether Tina was on a ‘Month One’ tax code, or not.
This ‘Month One’ tax code is often referred to as an Emergency Code.
Rebecca said: ‘If she is, she needs to sort that with HMRC, either by phoning them or by going into her personal tax account through the HMRC app.’
The expert said those who believe they might have been placed on an emergency tax code should check for an ‘X’ on their pay slip – at the end of your tax code.
For example, if your tax code is 1257L – it would read 1257LX instead.
He addressed the matter on his ITV Money Show Live, after a viewer queried whether she might be entitled to a tax rebate as she believes she was overtaxed by £800
Those on emergency tax codes could also see 1257W1 or 1257M1 on their pay slips. Stock image
Those on emergency tax codes could also see 1257W1 or 1257M1 on their pay slips.
This typically happens when HMRC doesn’t have enough information about a person’s tax situation. It occurs most often when a person starts a new job.
Rebecca said if Tina is on Month One, the money ‘should come back in her next pay packet’. However, she said: ‘If it doesn’t, speak to your employer.’
Those on emergency tax often pay higher rates than they would normally – and should receive a rebate if they have paid more than is necessary.
Martin urged those who suspect they have overpaid to contact HMRC.
He said: ‘Millions of people are on the wrong tax code. Some are overpaying and are therefore due thousands of pounds back. Some are underpaying and are therefore going to get a shock as they’re asked for more money.
‘So it’s really important because it is your responsibility… to check your tax code.’
Source: Read Full Article