The M1 tax code is a UK PAYE emergency tax code that applies Income Tax on a non-cumulative “Month 1” basis when HM Revenue & Customs (HMRC) lacks complete employment details.
Employers use the M1 tax code when a worker starts a new job without a P45, re-enters employment, or experiences a change in income source.
An M1 code, commonly shown as 1257L M1, allocates only one month of the annual Personal Allowance (£12,570 for the 2025 tax year) to each pay period rather than using year-to-date earnings.
This calculation method often increases short-term tax deductions under the PAYE system compared with a cumulative tax code.
HMRC automatically corrects the tax position once accurate information is received, issuing a cumulative code and refunding any overpaid Income Tax through payroll or directly to the taxpayer.
Cracking the Code on Your UK Payslip
Few things cause a sudden knot of anxiety quite like spotting an unfamiliar code on your payslip, particularly one associated with tax.
In the United Kingdom’s Pay As You Earn (PAYE) system, tax codes are the essential mechanism by which your employer determines how much Income Tax to deduct. For most people, the standard code is a simple three- or four-digit number followed by a letter, such as 1257L.
However, if you have recently started a new job or had a significant change in your circumstances, you may find your tax code ending in the sequence M1.
This is known as the M1 tax code, and while the sight of it can be alarming, especially if your take-home pay seems smaller than expected, it is rarely a cause for panic.
The M1 tax code is not a punishment or a fine; it is an interim measure used by HMRC to ensure you pay some tax while your full employment and tax history details are confirmed.
This article will demystify the M1 tax code, explain exactly what does M1 mean on my tax code?, detail why it impacts your pay, and provide clear, actionable steps on how to get rid of M1 tax code and secure any refund due.
We will also address the crucial question: Do you pay more tax on M1? and examine how long do you stay on the M1 tax code?
By the end of this comprehensive guide, you will be equipped with the expert knowledge to understand and resolve this common UK tax puzzle.
What M1 Tax Code Means? Why You Have It & How to Fix It?
The M1 tax code is a variant of the UK’s temporary, non-cumulative emergency tax codes. Its purpose is to act as a placeholder for the tax calculation when HMRC is missing critical information about an individual’s tax situation, ensuring the taxpayer pays some tax rather than none, which would result in a large, unexpected bill later on.
The full tax code is typically a combination of numbers (representing your tax-free allowance) and letters, for instance, 1257L. The addition of M1 is what changes the basis on which that code is calculated.
What Does “M1” Mean on a UK Payslip?
The “M1” suffix stands for Month 1.
This simple notation dictates a fundamental change in how your tax is calculated under the PAYE system. Most tax codes operate on a cumulative basis, meaning that when your tax is calculated each month:
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It considers your total income and tax paid since the start of the tax year (6th April).
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It uses your full annual Personal Allowance (£12,570 for most people, for instance) and calculates how much of that allowance should have been used up to the current month.
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It then adjusts your current month’s tax to make sure you are precisely on track to pay the correct amount of tax for the entire year, factoring in any under- or over-deductions from previous months.
The M1 suffix overrides this. When you are on an M1 tax code, your tax is calculated on a non-cumulative or ‘Month 1’ basis.
Is M1 a Tax Code or an Emergency Tax Indicator?
Technically, the M1 is an indicator that transforms your standard tax code into an emergency tax code.
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Tax Code: The main part (e.g., $1257L$) is your tax code, indicating your annual tax-free allowance.
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M1 Indicator: This suffix indicates that the code is being applied on an emergency, Month 1 basis.
Along with ‘W1’ (Week 1, for weekly paid employees) and ‘X’ (for codes where the pay period is variable), the M1 flag is one of the most common signs of an emergency tax situation.
It signals to the payroll system that the calculation must be strictly non-cumulative. You can find more details on how tax codes work on the official GOV.UK website: Tax codes: Overview – GOV.UK.
How the M1 Tax Code Works
To truly understand why the M1 tax code can dramatically alter your take-home pay, one must grasp the critical difference between cumulative and non-cumulative tax calculation.
Month 1 Basis Explained (Non-Cumulative Tax)
Under the Month 1 or non-cumulative basis, your employer or pension provider calculates your tax for the current pay period in isolation.
Crucially, the calculation only uses:
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Your income for that single month (or week).
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One-twelfth (or one fifty-second) of your annual tax-free Personal Allowance, and one-twelfth of each tax band threshold.
It completely ignores any:
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Income earned in previous months of the current tax year.
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Tax paid in previous months of the current tax year.
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Unused portion of your Personal Allowance from previous months.
For example, if the tax year started in April, and you are paid in December (Month 9), a normal cumulative code would apply 9/12 of your total annual Personal Allowance.
An M1 code will only apply 1/12 of your allowance for that one month, acting as if December is the first month of the tax year.
How M1 Affects Your Personal Allowance
The effect of the Month 1 basis on your Personal Allowance is the key reason for the commonly high tax deductions.
Let’s use the standard Personal Allowance of £12,570.
The monthly allowance is £12,570 / 12 = £1,047.50.
| Tax Code Basis | Month 1 (M1) Calculation | Cumulative Calculation (Example: Month 6) |
| Personal Allowance Applied | Only £1,047.50 (1 month’s worth) | £6,285 (6 months’ worth:£1,047.50 x 6) |
| Previous Income/Tax | Ignored | Accounted for and adjusted |
| Impact on Tax | Higher deduction in the short term, especially if under-utilised allowance existed | Accurate, year-to-date deduction |
The non-cumulative nature means that if you started the tax year without work, or on a low income, your unused tax-free allowance from those early months is not carried forward to offset your current, higher pay.
Difference Between M1 and Normal Cumulative Tax Codes
| Feature | M1 (Month 1/Non-Cumulative) | Normal (Cumulative) |
| Calculation Basis | Calculates tax based only on the current pay period’s income. | Calculates tax based on total year-to-date income and tax paid. |
| Allowance | Applies 1/12 (monthly) or 1/52 (weekly) of annual allowances/bands. | Applies the appropriate year-to-date proportion of annual allowances/bands. |
| Refunds/Adjustments | Ignores previous over/underpayments. | Automatically adjusts tax in the current period to correct previous over/underpayments. |
| Typical Impact | Often leads to overpayment of tax until corrected. | Designed to ensure the correct total tax is paid by the end of the year. |
You can read more articles on different taxe codes in the UK:
1263L Tax Code: Really a Hidden Gem in your Paycheck
1257L Tax Code: What Does it Mean in Your Paycheck?
D0 Tax Code:HRMC’s Premium Rates Impact on You
500T Tax Code: Guide for UK Tax Payers in 2025
SA302: What is it and How to Get One on 2025?
Why Have I Been Given the M1 Tax Code?
The M1 tax code is triggered when HMRC or your new employer’s payroll system lacks the complete, up-to-date information needed to calculate your tax on the standard cumulative basis. It’s the default safe-guard, designed to prevent underpayment.
Starting a New Job Without a P45
This is the single most common reason for receiving an M1 tax code. Your P45 is the legal document provided by your previous employer that shows your earnings and the tax you have paid in the current tax year.
When you start a new job without a P45, your new employer must ask you to complete a Starter Checklist.
If you indicate you have had another job since the last 6th April (the start of the tax year) but have not provided your P45, the payroll system is instructed to use an emergency tax code like M1 until HMRC can reconcile your records.
Changing Jobs or Multiple Employments
If you have changed jobs mid-year, even with a P45, a delay in HMRC processing the data can sometimes result in the M1 tax code being temporarily applied.
Furthermore, if you take on a second job, your primary code will likely apply to the main income, and the second income will be taxed differently, possibly with a BR or 0T code, but in some cases, a new employer may default to M1 if they don’t have enough information.
Employer Payroll Errors
While less common, an administrative error by your employer’s payroll department can also result in the M1 code being used.
This could be due to a mistake in entering your details from your P45 or starter form, or using the wrong payroll notification from HMRC.
HMRC Missing or Delayed Information
Sometimes, the delay is simply due to the sheer volume of data HMRC handles. When an employer submits your P45 or starter information,
HMRC must link this to your existing tax record and issue a new, cumulative tax code (a process called a P6 notice). If this process is delayed, your employer will default to the emergency M1 tax code to ensure tax is paid.
How M1 Tax Code Affects Your Take-Home Pay
The critical impact of the M1 tax code is its non-cumulative nature, which almost invariably leads to a higher tax deduction in the short term.
Do You Pay More Tax on M1?
Yes, you often pay significantly more tax initially when on an M1 tax code.
It’s important to clarify: you do not pay a higher tax rate (the 20%, 40%, or 45% bands remain the same); you pay more tax because your full tax-free allowance and tax bands are not being applied on a year-to-date basis.
By only giving you 1/12 of your Personal Allowance each month, the M1 basis ensures that the bulk of your income above that small threshold is immediately taxed at the basic rate (20%) or higher, regardless of how much tax-free allowance you have accrued and unused in previous months.
Example: M1 Tax Code Salary Calculation
Let’s illustrate with an example, using the standard UK tax year Personal Allowance of $\text{£}12,570$. This gives a monthly tax-free allowance of £1,047.50. The basic rate tax band is £37,700 (so tax at 20\% up to an annual salary of £50,270.
| Scenario | Calculation Basis | Monthly Income | Tax-Free Allowance Used | Taxable Income | Tax Deducted (Approx) |
| Normal Code (e.g., Month 6) | Cumulative (Applies 6 months’ allowance) | £3,333 (£40k salary) | £6,285 / 6 months = £1,047.50 of new allowance applied, but previous tax is adjusted | Varies greatly based on year-to-date figures | £450 |
| M1 Tax Code (Month 6) | Non-Cumulative (Month 1) | £3,333 (£40k salary) | Only £1,047.50 (1 month’s allowance) | £3,333 – £1,047.50 = £2,285.50 | £457.10 (£2,285.50 / 20%) |
| High Salary Example ($\text{£}60\text{k}$) | M1 Tax Code (Month 6) | £5,000 | Only £1,047.50 (1 month’s allowance) | £5,000 – £1,047.50 = £3,952.50 | £790.50 (£3,952.50 x 20%) |
Note: The M1 calculation will also apply the monthly thresholds for the basic and higher rate bands, meaning a higher earner could quickly hit the monthly higher rate threshold, leading to even greater deductions.
Why Bonuses and Overtime Are Heavily Taxed Under M1
The non-cumulative approach is particularly punitive when an individual receives a large, one-off payment such as a bonus or significant overtime while on the M1 tax code.
Because the calculation only uses a single month’s worth of the tax band thresholds (e.g., basic rate tax for a month), a large lump sum can push a huge portion of that income into the higher 40% or even 45% tax bands for that month only.
Under a normal cumulative code, this large payment would be averaged across the year for tax purposes. Under the M1 tax code, it is taxed heavily in isolation.
Is the M1 Tax Code Temporary or Permanent?
The M1 tax code is, by definition, an emergency tax M1 measure and is strictly temporary. It is not designed to be a permanent tax code.
When HMRC Automatically Updates Your Tax Code
In the majority of cases, the M1 code is resolved automatically by HMRC within the first few pay periods.
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Your employer submits your payroll data (including the Starter Checklist information) to HMRC.
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HMRC (the HMRC M1 tax code authority) matches this data to your National Insurance number and your previous tax record.
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HMRC then issues a new, corrected cumulative tax code (e.g., 1257L) to your employer via a P6 notification.
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Your employer must apply this new code in the next available pay run.
This process often takes 30 to 45 days.
How Long M1 Usually Stays Active
For most people who start a new job and provide a Starter Checklist or P45 promptly, the M1 code will only be active for one or two pay months.
If you are paid weekly, it may be for four to eight weeks. If you are still seeing the M1 or W1/X suffix on your payslip after three months, you should take action.
Signs Your Tax Code Needs Manual Correction
If the M1 code persists, it suggests a hitch in the automated system. Signs that your tax code needs manual correction include:
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M1 or W1/X remains on your payslip after 90 days.
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You receive a P60 at the end of the tax year with an M1/W1/X code on it (indicating the problem was never solved).
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Your tax code changes, but the new code is still clearly wrong (e.g., 0T or BR).
Will I Get a Tax Refund If I’m on M1?
Yes, almost certainly. Since the M1 tax code usually leads to over-deduction, one of the biggest reassurances for people on an M1 tax code UK is the knowledge that the overpaid amount will be returned. This is the tax code M1 refund.
When HMRC Issues Automatic Refunds
When HMRC successfully updates your tax code from M1 to a normal, cumulative code (e.g., 1257L), the payroll system immediately switches back to the cumulative method.
The cumulative system will then look at your year-to-date earnings and year-to-date tax paid. Seeing that your tax paid is disproportionately high compared to your year-to-date liability, the payroll system will perform an automatic adjustment.
This often means your next payslip will show a large negative tax deduction, effectively giving you a tax refund alongside your normal pay for that month.
End-of-Year Tax Reconciliation Explained
If, for any reason, the M1 code is not corrected during the tax year, HMRC will perform an end-of-year reconciliation process (P800 form) after the tax year ends on 5th April.
They match all the data provided by your employer(s) against your personal record. If they find you have overpaid tax due to the M1 emergency code, they will automatically calculate the refund amount and notify you.
How Refunds Are Paid (Payroll vs Bank Transfer)
There are generally two ways you receive your M1 tax refund:
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Via Payroll (P6 Update): The most common and fastest method. When your code is corrected mid-year, the overpaid amount is added to your next payslip, resulting in a significantly higher net pay for that period.
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Via Bank Transfer (P800): If the M1 code is not corrected during the tax year, or if you are no longer employed when the refund is due, HMRC will send you a P800 tax calculation. You will then be able to claim your refund online directly into your bank account. Check the GOV.UK website for the service to check if you can claim a tax refund.
How to Remove or Fix the M1 Tax Code
If your M1 tax code has persisted beyond the initial two-month period, you need to take proactive steps to fix it. This is the essential part of how to get rid of M1 tax code.
Check Your Tax Code Using HMRC Online Account
Your first step should always be to verify your tax code directly with the authority.
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Sign in to your Personal Tax Account on the GOV.UK website. You can sign in or set up your account here..
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Check the tax code listed for your current employment.
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The online service will often provide a breakdown of how the code was calculated, allowing you to spot missing or incorrect information.
Provide Missing Employment Details to HMRC
If your HMRC record is incomplete, you may need to provide the missing details.
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If you have your P45: You must give this to your new employer immediately. They are the ones who use the data and submit it to HMRC.
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If you do not have your P45: Ensure you completed the Starter Checklist truthfully and accurately when you began your new job. You can update your employment details directly via the Personal Tax Account if necessary.
What to Tell Your Employer or Payroll Team
Your employer cannot change your tax code themselves without instruction from HMRC, but they can (and should) chase HMRC on your behalf if they haven’t received an updated P6 notification.
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Notify your payroll department that you are still on the M1 tax code.
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Ask them to check that they have correctly submitted all your starter information (P45 or Starter Checklist) to HMRC.
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Ask them if they have received a new P6 coding notice from HMRC.
When to Contact HMRC Directly
If the issue is not resolved after your employer has checked their submissions, you must contact HMRC directly.
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HMRC Income Tax Helpline: Call 0300 200 3300 (Lines open Monday to Friday, 8am to 6pm).
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Be prepared: Have your National Insurance number, payslips showing the M1 code, and your employer’s details ready before you call.
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Explain that you are on the temporary non-cumulative tax code (M1) and ask them to review your PAYE record and issue a corrected, cumulative tax code (P6 notice) to your employer.
M1 vs Emergency Tax Codes (Comparison Table)
The M1 code is one of several emergency tax codes. Understanding its place is key.
M1 vs 1257L
| Feature | Code with M1 (e.g., 1257L M1) | Standard Code (e.g., 1257L) |
| Calculation | Non-Cumulative (Month 1) | Cumulative (Year-to-Date) |
| Personal Allowance | Applied on a monthly-only basis. | Applied on a year-to-date basis, factoring in all previous pay. |
| Status | Temporary Emergency Measure. | Permanent, standard code. |
| Implication | Likely to result in overpayment of tax initially. | Designed to ensure correct tax is paid across the year. |
M1 vs BR Tax Code
The BR (Basic Rate) tax code means that all income from that source is taxed at the basic rate (20%) with no Personal Allowance applied. This is often used for a second job.
| Feature | M1 (e.g., 1257L M1) | BR Tax Code |
| Allowance | Receives $1/12$ of Personal Allowance each month. | Receives zero Personal Allowance. |
| Tax Rate | Applies basic, higher, or additional rates based on monthly income. | All income is taxed at 20% (Basic Rate) regardless of amount. |
| Usage | Temporary, pending information (new job). | Standard for secondary employment where allowance is used elsewhere. |
M1 vs 0T Tax Code
The 0T tax code means you have no Personal Allowance applied, and your entire income is taxed at the applicable tax rates (basic, higher, additional).
| Feature | M1 (e.g., 1257L M1) | 0T Tax Code |
| Allowance | Receives 1/12 of Personal Allowance each month. | Receives zero Personal Allowance. |
| Tax Rate | Taxed based on $1/12$ of the tax bands. | Taxed based on the full tax bands starting from $\text{£}0$. |
| Usage | Temporary, pending sufficient information. | Used when your full Personal Allowance has been used up or cancelled by other untaxed income or benefits. |
Common Myths About the M1 Tax Code
Due to its nature as an ’emergency’ measure, the M1 tax code is subject to much anxiety and misinformation.
“M1 Means I’m on Emergency Tax Forever”
Myth. The M1 tax code meaning is Month 1, indicating a temporary calculation basis. It is a transitional code used by HMRC until they can confidently assign you a correct, cumulative tax code. It is designed to be a short-term fix, usually lasting one to three months.
“HMRC Has Fined Me”
Myth. The higher deduction is not a fine or a penalty. It is a consequence of the non-cumulative calculation which removes the benefit of unused tax-free allowance from previous months. All overpaid tax is held by HMRC and will be returned to you.
“I’ll Never Get the Extra Tax Back”
Myth. This is the most damaging piece of misinformation. Any tax overpaid while you were on the M1 tax code is not lost. It is a non-cumulative tax code which leads to over-collection, and the cumulative PAYE system is designed to correct this. As explained above, the refund will be paid either through a large adjustment on a subsequent payslip or directly from HMRC at the end of the tax year via a P800.
How to Avoid the M1 Tax Code in the Future
To prevent being placed under an M1 tax code, follow these best practices:
- Always submit your P45 from your previous employer when starting a new job.
- If you don’t have a P45, complete the Starter Checklist thoroughly and correctly.
- Inform your new employer if you’ve had another job or received taxable benefits during the same tax year.
- Regularly check your payslip for your tax code and any unusual deductions.
Frequently Asked Questions About M1 Tax Code
Is M1 the Same as Emergency Tax?
Yes. The M1 (or W1/X) suffix indicates that your current tax code is being applied on an emergency, non-cumulative basis. While it is technically a tax code (e.g., 1257L, M1), the M1 element is the emergency indicator.
Can I Stay on M1 All Year?
While it is not supposed to happen, it is possible to remain on the M1 tax code all year if HMRC does not receive and process the correct information.
If this occurs, you will have paid too much tax across the year and will be due a refund via the end-of-year P800 reconciliation process, which typically happens after the tax year ends on 5th April.
Does M1 Affect Universal Credit or Pensions?
The M1 tax code primarily affects your Income Tax deduction. Your net pay (take-home pay) is one of the factors used in calculating benefits like Universal Credit.
Since the M1 code temporarily reduces your net pay, it could potentially affect your Universal Credit award, though the complex nature of the calculation means professional advice should be sought.
Should I Worry If My Tax Code Has M1?
No, you should not worry, but you should take action. It is a common, temporary issue. Worrying is counterproductive; being proactive is essential. The money is not lost, it is simply being held until your records are sorted.
The Bottom Line
While seeing M1 tax code on your payslip may be alarming, it’s not a long-term concern if handled promptly. Think of it as a safety net used by HMRC to prevent tax evasion or large underpayments in uncertain employment situations.
However, prolonged application of this code can lead to temporary overpayment, so it’s crucial to monitor your payslips and act swiftly.
Understanding the logic behind the M1 tax code transforms it from a scary enigma into a solvable puzzle. Take the required action, and your tax code (and your wallet) will soon be corrected.
If you would like to see an example of what an emergency tax code is and why you may have one, you can watch this video: What is an emergency tax code? This video from the search results is relevant because it explains the concept of emergency tax codes, of which the M1 tax code is a common variant.
The content provided on TaxCalculatorsUK, including our blog and articles, is for general informational purposes only and does not constitute financial, accounting, or legal advice.
You can also visit HMRC’s official website for more in-depth information about the topic.
