When your payslip shows a tax code of BR, every pound you earn from that job is taxed at 20 per cent. There is no personal allowance applied to this income. It looks harsh, but it is often correct — and sometimes completely wrong.
What BR stands for
BR means Basic Rate. HMRC uses it when the full personal allowance has already been used somewhere else, so this income is taxed at the basic rate from the first pound. It is the common code for a second job, a second pension, or some short-term contracts.
When BR is right for you
BR is correct if you have a main job that already uses your full personal allowance, and this is a second source of income. For example, if you earn £30,000 in your main job and £6,000 in a weekend role, the main job uses the £12,570 allowance and the weekend role gets a BR code.
In that situation, 20 per cent tax on every pound of the second income is exactly what should happen. You can check the combined figures with our UK salary calculator.
When BR is wrong
BR is sometimes applied in error, particularly:
- New job, no P45: if your new employer did not get a P45, they might default to BR while HMRC sorts out the correct code.
- Only job: if this is your only income, you should be on 1257L, not BR. Being on BR here means you have lost the personal allowance and could be paying hundreds of pounds too much tax.
- Pension income: if the pension is your only income, a BR code can cost you your allowance unless HMRC is told otherwise.
How to fix a wrong BR code
Go to your Personal Tax Account and check what HMRC has recorded. If they only show one job, you can ask HMRC to update the code to 1257L. If they show two jobs but the wrong one has the allowance, you can choose which income should receive the allowance.
Use our tax code calculator to see how much tax should be coming out of your pay. If the figure is much higher than expected, that is often a sign that a BR code is in the wrong place.
When to claim a refund
If you have overpaid tax because of a BR code, HMRC usually issues a refund automatically after the tax year ends. You can also claim sooner through your Personal Tax Account. Keep your payslips and P45 so you can check the figures HMRC used.
The bottom line
A BR code is not a mistake in itself. It is just shorthand for "no allowance on this income." If that matches your situation, leave it alone. If it does not, the sooner you correct it, the sooner the extra tax stops.