BR Tax Code Meaning (2026/27) — Why You're Being Taxed 20% on Everything

A BR (Basic Rate) tax code means you receive £0 tax-free Personal Allowance on this job or pension, and 100% of your gross pay is taxed at a flat 20% from the first pound earned. On a £45,000 salary, a BR code deducts £9,000/year (£750/month) in Income Tax—costing you £209.50/month (£2,514/year) more than the standard 1257L code.

Gross Salary Scenario (2026/27)	Monthly Tax on BR (20% Flat)	Monthly Tax on Standard 1257L
£20,000 Gross Salary	£333.33 / mo (£4,000/yr)	£123.83 / mo (£1,486/yr) — £209.50/mo extra on BR
£30,000 Gross Salary	£500.00 / mo (£6,000/yr)	£290.50 / mo (£3,486/yr) — £209.50/mo extra on BR
£45,000 Gross Salary	£750.00 / mo (£9,000/yr)	£540.50 / mo (£6,486/yr) — £209.50/mo extra on BR

Frequently Asked Questions (2026/27 & 2027/28 UK Rules)

Why has HMRC put me on a BR tax code?

HMRC usually assigns a BR tax code when you start a second job or draw a pension while your primary employer is already using your full £12,570 Personal Allowance, or when you start a new job without providing a P45 or Starter Checklist.

How do I get a refund if I was wrongly put on a BR tax code?

Log into the HMRC app or call HMRC on 0300 200 3300 to confirm your previous job has ended. Once HMRC issues a cumulative 1257L code to your employer, any overpaid tax from earlier months in the current tax year is automatically refunded in your next payslip.

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