How to Handle Tax When You Change Jobs Mid Tax Year (2026/27)

P45 parts 2 and 3, the starter checklist statements, why a Week 1 / Month 1 code over-taxes a gap month, and how HMRC corrects it - with a worked example.

2026/27 tax year

Employment & Career
Employee
UK-wide

Summary

Give your new employer Parts 2 and 3 of your P45 and keep Part 1A; if you have no P45, fill in HMRC's starter checklist instead, and fill it in anyway if you have a student loan.
The starter checklist statement sets your first tax code: A gives the Personal Allowance on a cumulative basis, B gives it on a Week 1 / Month 1 basis, C gives code BR.
A Week 1 / Month 1 code taxes each pay packet on its own, so any allowance you did not use in a gap month or an earlier low-paid month is ignored until the code goes cumulative.
HMRC usually updates the code automatically once it has details from both employers, which can take up to 35 days from your start date; if it still has not changed after 35 days, contact HMRC.
Once the code is cumulative, the payslip that first uses it refunds the overpayment (GOV.UK: the next or following payslip if monthly, the third if weekly); after the tax year ends, HMRC sends a P800 between June and March and an online refund claim is paid in 5 working days.

This guide is general information, not advice.

This is for an employee who leaves one PAYE job and starts another part-way through the 2026/27 tax year, with or without a gap. It covers the paperwork in the order it happens, what the new employer does with it, and why the first payslip at the new job so often carries the wrong tax.

By the end you will know which P45 parts to hand over, which starter checklist statement fits, when HMRC fixes an emergency code on its own, and what a cumulative code does to a gap month once it lands.

Before you start

Your P45 from the employer you are leaving. GOV.UK says it shows your leaving date, your total pay and tax from 6 April until the date you left, and your tax code (per GOV.UK: P45).
Your National Insurance number and your start date at the new job. The starter checklist asks for both.
Your student loan plan type (Plan 1, 2, 4 or 5, and Postgraduate Loan) if you have one. The checklist says to check it at gov.uk/sign-in-to-manage-your-student-loan-balance.
A Government Gateway login for the Check your Income Tax service or the HMRC app.
Dates of any Jobseeker’s Allowance, Employment and Support Allowance or Incapacity Benefit received since 6 April; they decide the statement.

Step-by-step

Get your P45 and split it. Your old employer gives you the P45 when you stop working for them. GOV.UK’s instruction is exact: “If you have a paper P45, you only need to give your new employer Parts 2 and 3. Keep Part 1a” (per GOV.UK: P45). If you have lost it, or the old employer says it was sent and it never arrived, the same page says you cannot get a replacement. Go to step 2.
If there is no P45, complete the starter checklist. Use the starter checklist (updated 2 March 2026) or the online version at tax.service.gov.uk, then “Email, post or give the starter checklist to your new employer”. Do not send it to HMRC. The employer side of the guidance adds that they should ask for the checklist if your last job ended before 6 April, because a P45 from a previous tax year is not used (per GOV.UK: get employee information).
Choose the right statement. The checklist routes you by question: another job now, or a State, workplace or private pension, means statement C; payments since 6 April from another job that has ended, or from JSA, ESA or Incapacity Benefit, means statement B; neither means statement A. The employer instructions on the form then say: “Statement A – use the current personal allowance; Statement B – use the current personal allowance on a ‘week 1/month 1’ basis; Statement C – use tax code BR” (per HMRC starter checklist PDF). If no statement is signed, the employer uses 0T on a Week 1 / Month 1 basis (per PAYE61030). What 0T and BR cost you is in Emergency tax: what to do.
Fill in the student loan section even if you have a P45. HMRC’s checklist says: “You should also fill in this form if you have a student loan (whether or not you’ve a P45)”. Tick one plan type only and, if it applies, the Postgraduate Loan box as well. GOV.UK’s repayment guidance also tells you to check your employer has you on the correct repayment plan (per GOV.UK: how you repay).
Hand a late P45 over anyway. If the P45 arrives after your first payday, give it to the new employer. The checklist tells employers that a P45 given after the first Full Payment Submission means using the code shown in Parts 2 and 3.
Check the code HMRC issues. Sign in to the Check your Income Tax service and look at your employment, estimated taxable income and benefit details. If the code is wrong and you cannot use the service, contact HMRC. GOV.UK says that if the code needs to change, HMRC will tell you and your employer the new code within 15 working days (per GOV.UK: if you think your tax code is wrong).
Expect auto-enrolment to start again. A new employer must enrol you in a workplace pension if you are a worker aged between 22 and State Pension age, earn at least £10,000 a year and ordinarily work in the UK. GOV.UK says the employer can delay enrolling you by up to 3 months, and longer in some cases where it uses a defined benefit or hybrid scheme (per GOV.UK: joining a workplace pension). The test is applied by each employer, so an old opt-out does not carry.

Deadlines and what happens next

Cumulative versus Week 1 / Month 1. A code ending W1, M1 or X works out tax on “what you’re paid in that week or month only”, so “you get taxed as if you’re paid that amount every week or month of the year” (per GOV.UK: emergency tax codes). A cumulative code instead compares your pay since 6 April with the allowance you have earned since 6 April and taxes the difference. That is why a month with two pay packets, or a gap month with none, goes wrong under W1 / M1: the new employer sees one pay figure and one month’s allowance, and nothing else.

When HMRC acts on its own. GOV.UK says HMRC will usually update your code automatically once it has details from both your old and new employer, and that this can take up to 35 days from when you start the job. Giving the new employer your P45 speeds this up. If you started more than 35 days ago and your code still ends W1, M1 or X, that is the point at which GOV.UK tells you to contact HMRC rather than wait.

How the refund arrives in-year. Once the employer applies a cumulative code, the payslip that first uses it recalculates the year to date and repays the excess through your wages: GOV.UK says the next or following pay if you are paid monthly, the third pay if weekly (per GOV.UK: if you’ve paid too much or too little tax). There is no claim to make.

After the tax year. If you were still on a non-cumulative code at 5 April, HMRC reconciles your PAYE and sends a P800 tax calculation letter “between June and March of the following tax year” (per GOV.UK: tax overpayments and underpayments). If it says you are due a refund, claim it online with the P800 reference and your National Insurance number: 5 working days for a bank transfer, 6 weeks for a cheque you request, and 14 days from the letter date if HMRC sends a cheque automatically (per GOV.UK: if you are due a refund). If no P800 arrives and you think you overpaid, use Check how to claim a tax refund.

Common mistakes

Ticking statement A when you had a job earlier in the year. The new employer then applies the full allowance cumulatively while the old employer already used part of it, and you under-pay until HMRC catches it.
Handing over Part 1A. That part is yours to keep. The new employer needs Parts 2 and 3.
Leaving the student loan section blank because you gave a P45. HMRC’s checklist asks for it regardless.
Waiting past 35 days. GOV.UK sets 35 days as the point to contact HMRC if the code has not moved. Before then, the fix is usually automatic.

Worked example

Figures: Personal Allowance £12,570 and basic rate 20% for 2026/27 (per GOV.UK: Income Tax rates). One month of allowance is £12,570 / 12 = £1,047.50. This is illustrative: payroll software uses HMRC’s PAYE tables, which work from the tax code number rather than an exact twelfth of the allowance, so a real payslip can differ from these figures by a small amount.

You earn £30,000 (£2,500 a month) at job one from April to June, months 1 to 3. Tax each month is (£2,500 − £1,047.50) × 20% = £290.50, so £871.50 by the end of June. You leave, have July off with no pay, and start job two on 1 August at £36,000 (£3,000 a month).

Month 5 (August), no P45 yet, statement B, 1257L M1. The employer taxes £3,000 against one month’s allowance: (£3,000 − £1,047.50) × 20% = £390.50. July’s unused £1,047.50 of allowance is ignored.

Month 5 on a cumulative code instead. Pay to date £7,500 + £3,000 = £10,500. Allowance to date 5 × £1,047.50 = £5,237.50. Tax due to date (£10,500 − £5,237.50) × 20% = £1,052.50, less £871.50 already paid = £181.00. The M1 code over-taxed August by £209.50, which is exactly July’s allowance at 20%.

Month 6 (September), code now cumulative. Pay to date £13,500; allowance to date £6,285; tax due to date £1,443; already paid £871.50 + £390.50 = £1,262. Tax this month £181.00 instead of the £390.50 a normal month would carry. The £209.50 comes back on that payslip with no claim from you.

Emergency tax: what to do - what 0T, BR and 1257L W1 / M1 each cost you, and the five-step fix.
P45, P60 and P11D: the complete 2026/27 guide - the three forms side by side and when each arrives.
How to read a PAYE coding notice - what the letter HMRC sends after a job change actually says.

Frequently asked questions

Do I give my new employer the whole P45?

No. GOV.UK says that with a paper P45 you only give your new employer Parts 2 and 3, and you keep Part 1A. The P45 shows your leaving date, your total pay and tax from 6 April to the date you left, and your tax code, which is what the new employer needs to carry on taxing you cumulatively.

I lost my P45. Can I get another one?

No. GOV.UK states that if you have lost your P45, or your employer says they sent one but you did not get it, you cannot get a replacement. Fill in HMRC's starter checklist instead and give it to the new employer. Tick statement B if you had another job since 6 April but have no P45, and the employer applies the Personal Allowance on a Week 1 / Month 1 basis until HMRC sends a cumulative code.

How long does emergency tax last after starting a new job?

GOV.UK says HMRC will usually update your tax code automatically once it has details from both your old and new employer, which can take up to 35 days from when you start your job. If you started more than 35 days ago and still have a W1, M1 or X code, contact HMRC. Handing over your P45 speeds this up. Once the code is cumulative, the overpaid tax comes back through the payslip that first uses it.

Will my student loan repayments carry on at the new job?

Yes, if the new employer knows about the loan. GOV.UK's repayment guidance tells you to check your employer has you on the correct repayment plan. HMRC's starter checklist says to fill it in if you have a student loan whether or not you have a P45, ticking one plan type (Plan 1, 2, 4 or 5) and the Postgraduate Loan box as well if that applies.

Do I get a tax refund at the end of the year if I changed jobs?

Only if you overpaid across the year as a whole. If your code went cumulative during the year, the refund has already come through your pay. If it did not, HMRC reconciles PAYE after 5 April and sends a P800 tax calculation letter between June and March of the following tax year. GOV.UK says an online bank transfer claim is paid within 5 working days and a cheque within 6 weeks; if HMRC sends a cheque automatically it arrives within 14 days of the date on the letter.