The D0 M1 tax code tells your employer or pension provider to deduct 40% income tax from everything they pay you from that source, calculating each pay period on its own rather than against a running yearly total. The D0 part removes your personal allowance from this income. The M1 part means the calculation ignores what you’ve earned and paid in tax so far this year. It usually appears on a second job, a new pension, or a job you’ve just started where HMRC doesn’t yet have your full picture.
What Each Part of the Code Means
D0 is a flat instruction: tax every pound from this job or pension at the higher rate of 40%.1GOV.UK. Tax Codes – What Your Tax Code Means There is no tax-free slice built in. The 40% comes off your gross pay from the first pound.
HMRC uses D0 when it believes your £12,570 personal allowance is already being applied against a different income source, typically your main job or a pension.2GOV.UK. Income Tax Rates and Personal Allowances Without D0 on the second source, you’d effectively receive two allowances and end the year with a large underpayment.
M1 stands for “month 1” and marks the code as non-cumulative. Under a normal cumulative code, payroll software keeps a running total of everything you’ve earned and all the tax you’ve paid since 6 April, then adjusts each month’s deduction so the year-to-date figures line up.3Low Incomes Tax Reform Group. Tax Codes – What Employers Need to Know M1 switches that off. Your employer works out the tax on that single month’s pay as though it were the only month in the year, and earlier months are ignored.4GOV.UK. Emergency Tax Codes
If you’re paid weekly, the same code appears as D0 W1. The logic is identical, just applied one week at a time.1GOV.UK. Tax Codes – What Your Tax Code Means
Why HMRC Has Put You on D0 M1
The most common reason is a second income. If your main employer already uses your full personal allowance under a code like 1257L, the second job or pension has no allowance left to receive, and D0 is the result. The M1 suffix gets added when HMRC hasn’t yet been able to calculate your tax on a cumulative basis, which is common at the start of a new employment.
Other situations that produce D0 M1 include:
- You didn’t give your new employer a P45 from your previous job, so they had no year-to-date figures to work from.4GOV.UK. Emergency Tax Codes
- You’ve started drawing a workplace or private pension alongside employment, and HMRC has routed your allowance to the employment.
- You’ve begun receiving the State Pension. It’s paid without tax deducted, so HMRC collects the tax owed by reducing the allowance in another code. When this starts partway through a tax year, a non-cumulative basis is often used to avoid over-collecting.5Low Incomes Tax Reform Group. How Tax Is Collected on the State Pension
- HMRC hasn’t yet received full details from your employer and is using D0 M1 as a holding position until the information arrives.
The M1 element is almost always temporary. Once HMRC has your complete picture, it usually issues a replacement cumulative code automatically.3Low Incomes Tax Reform Group. Tax Codes – What Employers Need to Know The D0 part may stay in place permanently if you genuinely have a second income source and your allowance rightly sits elsewhere.
What the Code Does Not Change
Your tax code only controls income tax. National Insurance is always calculated on each pay period in isolation, regardless of your code, so M1 makes no difference to your NI deductions.6Low Incomes Tax Reform Group. National Insurance for Employees Student loan repayments work the same way: they’re based on your earnings in the pay period against the plan threshold, and the D0 or M1 designation doesn’t alter that calculation.
How to Check and Change Your Code
The quickest route is the “Check your Income Tax” service on GOV.UK, or the HMRC app, which use the same underlying account.7GOV.UK. Check Your Income Tax for the Current Year You sign in with a Government Gateway account, and you may need photo ID to verify your identity the first time.
Through the service you can:
- See your current code and how your personal allowance is allocated across each employment and pension.
- Update the income estimates HMRC holds for each source, which can trigger an automatic recalculation.
- Tell HMRC that a previous job has ended, which frees up your allowance for the right source.
If you’d rather call, the Income Tax helpline is 0300 200 3300. Have your National Insurance number to hand, along with your current employer PAYE references from a payslip or P60 and any P45 figures from a previous job.8GOV.UK. PAYE and Payroll for Employers
Once HMRC updates your code, it sends you a new coding notice and transmits the change to your employer electronically. It generally shows up in your pay within a few weeks, depending on when your employer next runs payroll. If the switch is from M1 to a cumulative code, the payroll software will recalculate your tax from 6 April and adjust that month’s deduction to match. If you’d been overtaxed, your first corrected payslip can look noticeably better than usual.
Getting Back Any Overpaid Tax
If D0 M1 was wrong for you, you may have paid more income tax than you owed. How you get it back depends on when the correction happens.
If HMRC fixes the code during the same tax year, the switch to a cumulative code usually sorts it out automatically. The payroll recalculates from 6 April and reduces your deductions over the remaining months until the overpayment is absorbed. No separate claim is needed.
If the tax year ends before the code is corrected, HMRC reconciles your account after 5 April and sends a P800 tax calculation letter. These are issued between June and the following March. Where the P800 shows a refund and says you can claim online, you can request a bank transfer through your Personal Tax Account and get the money within five working days. Where the letter says a cheque will be sent, it arrives within 14 days of the date on the letter.9GOV.UK. Tax Overpayments and Underpayments – If Your Tax Calculation Letter (P800) Says You’re Due a Refund
If you already know the code is wrong, don’t wait for a P800. Sorting it in-year takes minutes online and saves months of extra tax coming out of your pay.