D0 and D1 Tax Codes Explained (2026/27)
D0 taxes every pound from one income source at the 40% higher rate. D1 taxes every pound at the 45% additional rate. Neither applies any Personal Allowance. HMRC uses them on second jobs and second pensions when your main income has already filled up the lower bands - the next pound earned therefore belongs in 40% or 45% territory.
How to read D0 and D1
- D = Deduction at a higher band rate.
- 0 = 40% higher-rate flat.
- 1 = 45% additional-rate flat.
- No number = no allowance (the entire source is taxed).
- SD0 / SD1 / SD2 = Scottish equivalents at 42% / 45% / 48%.
- CD0 / CD1 = Welsh equivalents (currently same rates as rest-of-UK).
Both codes step up from BR (20%) in the same way: HMRC assumes your main income source holds the PA and any lower bands; the second source's job is to collect the marginal rate. The difference between D0 and D1 is purely the position of your main income on the band ladder - D0 means basic-rate-band-already-full; D1 means higher-rate-band-already-full.
Worked example: D0 on a £20,000 second job
Main job £80,000 on 1257L (well into higher-rate territory), plus a second job £20,000 coded D0. England/NI rest-of-UK:
| Line | D0 annual | Monthly |
|---|---|---|
| Gross pay (second job) | £20,000 | £1,667 |
| Personal Allowance applied | £0 | £0 |
| Income Tax (40% flat) | £8,000 | £667 |
| Class 1 NI (assessed separately per employment) | £594 | £50 |
| Take-home from second job | £11,406 | £950 |
Had this second job been coded BR (20%) by mistake, only £4,000 of Income Tax would have been collected this year - an under-payment of £4,000 that HMRC would chase through Self Assessment the following January. D0 collecting 40% at source keeps PAYE accurate.
D0 take-home at common second-job sizes
| Second-job gross | Income Tax (D0) | NI | Take-home |
|---|---|---|---|
| £5,000 | £2,000 | £0 | £3,000 |
| £10,000 | £4,000 | £0 | £6,000 |
| £15,000 | £6,000 | £194 | £8,806 |
| £20,000 | £8,000 | £594 | £11,406 |
| £30,000 | £12,000 | £1,394 | £16,606 |
| £50,000 | £20,000 | £2,994 | £27,006 |
Worked example: D1 on a £25,000 second job
Main job £150,000 on a 0T code (PA fully tapered to zero, well into additional-rate territory), plus a second source of £25,000 coded D1:
| Line | D1 annual | Monthly |
|---|---|---|
| Gross pay (second source) | £25,000 | £2,083 |
| Personal Allowance applied | £0 | £0 |
| Income Tax (45% flat) | £11,250 | £938 |
| Class 1 NI | £994 | £83 |
| Take-home from second source | £12,756 | £1,063 |
D1 take-home at common second-source sizes
| Second-source gross | Income Tax (D1) | NI | Take-home |
|---|---|---|---|
| £5,000 | £2,250 | £0 | £2,750 |
| £10,000 | £4,500 | £0 | £5,500 |
| £20,000 | £9,000 | £594 | £10,406 |
| £30,000 | £13,500 | £1,394 | £15,106 |
| £50,000 | £22,500 | £2,994 | £24,506 |
| £75,000 | £33,750 | £3,511 | £37,739 |
How to check if D0 or D1 is right
Use HMRC's Personal Tax Account or the Check your Income Tax service to confirm two things:
- HMRC's estimate of your main job's annual income is accurate - if they think you earn £130k but you actually earn £80k, they may wrongly use D0 or D1 on the second source.
- The split between PA-bearing and flat-rate codes makes sense: the higher-paying of your two jobs should normally carry the 1257L code (so the PA shields the most pounds), with the smaller source on BR, D0 or D1.
How to fix a wrong D0 or D1 code
- Update HMRC's income estimate for the main job - the second-source code follows automatically.
- Online via gov.uk/tax-codes/if-your-tax-code-is-wrong.
- Phone HMRC PAYE on 0300 200 3300 (Mon-Fri 8am-6pm).
- Ask HMRC to rebalance PA between two jobs - useful if the smaller (D0/D1) source is now your bigger one.
- Any over-paid tax from a wrong D0 or D1 is refunded automatically via P800 in the summer after the tax year ends, or sooner if you ask HMRC to re-code mid-year.
Related tax codes
- 1257L meaning - the standard UK code
- BR tax code - 20% on every pound
- 0T tax code - no PA, full bands
- K tax code (K500, K850, K1000) - negative allowance
- NT tax code - no Income Tax deducted
- All UK tax codes index
Frequently asked questions about D0 and D1
- What is the difference between D0 and D1?
- Both are flat-rate codes with no Personal Allowance, used by HMRC on second income sources. D0 applies the 40% higher rate to every pound; D1 applies the 45% additional rate. HMRC chooses D0 when your main income already fills the basic-rate band (over £50,270 but under £125,140); D1 when your main income already pushes you into additional-rate territory (over £125,140). The mechanism is identical - only the percentage changes.
- Why am I on D0 instead of BR?
- Because HMRC believes your main job has already used both your Personal Allowance and your full £37,700 basic-rate band, so anything additional should be taxed at the 40% higher rate. If they applied BR (20%) to a second job in this situation, you would end up owing the extra 20% at year-end through Self Assessment. D0 collects 40% from the second source from pound one, keeping PAYE accurate across both employments.
- When does HMRC use D1?
- D1 is rare. It is reserved for taxpayers whose main income already exceeds £125,140 - the point at which the Personal Allowance has fully tapered to zero and the 45% additional rate kicks in. A typical D1 holder has a main employment over £125k plus a separate small employment, pension, or board-fee arrangement. Fewer than 1% of UK taxpayers see D1 in any given year.
- How do I check if D0 or D1 is correct for me?
- Log into your HMRC Personal Tax Account or use the official Check your Income Tax service. It shows every code in force, which income source each one applies to, and the income estimate HMRC is using. If HMRC has over-estimated your main job's income (e.g. they think you still earn £130k when you actually earn £80k), they may wrongly assign D0 or D1 to your second source - call HMRC on 0300 200 3300 to correct the estimate and the code follows.
- Will D0 or D1 over-tax me?
- They can. D0 over-taxes you if your total combined income falls below £50,270 - you would be paying 40% on the second job when your overall liability only justifies 20%. D1 over-taxes you if your total combined income falls below £125,140. In either case HMRC reconciles automatically at year-end via a P800 and refunds the excess, but you can recover it sooner by asking HMRC to re-code the second source to BR or 0T mid-year.
- Do D0 and D1 work in Scotland?
- Scotland has different equivalents. Scottish taxpayers above the higher-rate threshold see SD0 (Scottish higher rate, 42% in 2026/27), SD1 (Scottish advanced rate, 45%) or SD2 (Scottish top rate, 48%). The mechanism is the same - flat-rate flat-PA codes used on a second income - but the rates align with Scottish Income Tax bands rather than the UK 40%/45%.