Tax Code Changes Explained

Your tax code tells your employer how much tax to take off your pay. Leaving service almost always changes it, and the change is often wrong at first.

The usual cause is starting a civilian job without a record of your previous income reaching HMRC yet. That puts you on an emergency code, which taxes you as though the pay for that period is what you earn every period — normally meaning you pay too much.

Emergency codes end in W1, M1 or X, so 1257L W1 or S875L M1. Some payslips show NONCUM instead. Any of those is worth acting on.

A military pension alongside a salary can also shift your code, because HMRC has to split your personal allowance across two sources of income.

Who is eligible?

This isn't something you apply for — it happens to you. Anyone starting a new job, drawing a pension, or claiming certain benefits can see their code change.

What you can do is check it. Your code is on every payslip, and comparing it against what HMRC thinks your income is takes a few minutes.

Give your new employer the P45 from your service and HMRC will normally correct the code once it has details from both employers, which takes up to 35 days.

If an emergency code has taken too much, you can reclaim it. Overpaid tax isn't lost.

What benefits does this provide?

  • Know the emergency codes on sight: They end in W1, M1 or X — for example 1257L W1 or S875L M1 — and some payslips show NONCUM instead. Any of these means you are being taxed as though your pay for that period is what you earn every period, which usually means overpaying.
  • Your P45 is what fixes it: Give the P45 from your service to your new employer. HMRC normally updates the code once it has details from both employers, which takes up to 35 days.
  • Overpaid tax comes back: If an emergency code has taken too much, you can reclaim it — you do not lose it by having been on the wrong code.

Tax Code Changes provide several benefits to military service leavers and veterans:

  • Tax Relief: Adjustments in tax codes can lead to reduced tax liabilities, allowing veterans to keep more of their income.
  • Simplified Tax Filing: Updated tax codes can simplify the filing process, making it easier for veterans to understand and comply with tax regulations.
  • Eligibility for Tax Credits: Veterans may become eligible for specific tax credits, such as the Earned Income Tax Credit (EITC), which can provide significant financial relief.
  • Deductions for Service-Related Expenses: Certain tax code changes allow for deductions related to service, such as moving expenses for a new job or education costs.
  • Retirement Benefits: Adjustments can enhance the tax treatment of retirement benefits, ensuring veterans receive the maximum possible benefit from their pensions and savings plans.
  • Healthcare Savings: Tax code changes may also provide benefits related to healthcare savings accounts, making it easier to manage medical expenses.

How do I apply?

  • Check Your Current Tax Code: Review your latest payslip or P60 to find your current tax code.
  • Identify the Need for Change: Determine why you need a tax code change, such as a change in employment status, benefits, or allowances.
  • Gather Necessary Information: Collect relevant documents, including your National Insurance number, details of your income, and any benefits or allowances.
  • Contact HMRC: Reach out to HM Revenue and Customs (HMRC) via their online services, phone, or post. Use the online Personal Tax Account for a quicker response.
  • Submit Your Request: Provide all required information and explain why you believe your tax code should be changed.
  • Wait for Confirmation: HMRC will review your request and send you a new tax code if approved. This may take a few weeks.
  • Update Your Employer: Inform your employer of the new tax code to ensure your payroll is updated accordingly.

Common questions

Why has my tax code changed after leaving the armed forces?

Starting a job without a record of your previous income puts you on an emergency code. These end in W1, M1 or X, and some payslips show NONCUM instead.

What is an emergency tax code?

A code that taxes you as though the pay for that period is what you earn every period, rather than across the full year. It usually means paying too much.

How do you claim back overpaid tax after leaving service?

Give your new employer the P45 from your service. HMRC normally corrects the code once it has details from both employers, which takes up to 35 days, and any overpayment can be reclaimed.

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Last reviewed 26 August 2026 by Brittany Belt, Co-founder and COO