Tax Code · 2026/27
D0 Tax Code — Higher-Rate (40%) on Every Pound UK 2026/27
D0 applies a flat 40% higher-rate to all pay from this source. HMRC uses it when they believe your total income already sits above the basic-rate band.
What the D0 tax code means
The D0 tax code taxes 100% of pay from this source at the higher rate — currently 40% in England, Wales and Northern Ireland. No Personal Allowance is given because HMRC assumes it's used on your primary income.
It's the next step up from BR: HMRC applies D0 when your primary job has already filled the basic-rate band (income over £50,270 in 2026/27) and this additional source pushes you into higher-rate territory.
D0 avoids an under-payment scenario where a second job taxed at BR (20%) would leave you owing the extra 20% at year-end. By collecting 40% at source, HMRC keeps PAYE accurate across both employments.
When you'll see D0
- You have a well-paid second job and your main income already exceeds £50,270/year.
- You receive a company pension while still employed in a higher-rate role — the pension can be coded D0.
- You're a director with salary plus board fees — the fees are sometimes coded D0 to collect the higher rate at source.
What to do if you have a D0 code
- Confirm with HMRC that your main employment is using 1257L and that this second source is correctly identified as additional.
- If your circumstances change (main job ends, salary drops) and D0 is no longer appropriate, call HMRC on 0300 200 3300 or update details via your Personal Tax Account.
- If you're on D0 but your total income won't exceed the higher-rate threshold this year, HMRC will normally refund the over-tax at year-end.
Worked example
£15,000 second-job income on D0 while your main job pays £60,000 (already in higher-rate territory). Income Tax on the second job is 40% × £15,000 = £6,000. Without D0 (e.g. on BR at 20%), you'd pay only £3,000 here and owe £3,000 at year-end through self-assessment.
Want to see the numbers for your own salary? Use the salary calculator and pick 2026/27 to see how D0 interacts with your full take-home.
Frequently asked questions about D0
- How is D0 different from BR?
- BR applies 20% to all pay; D0 applies 40%. HMRC moves you from BR to D0 when they see your total income is already in higher-rate territory — it's a more accurate collection at source.
- I'm only on D0 — does that mean I'm taxed 40% on everything?
- D0 applies only to pay from that source (usually a second job or pension). Your primary source keeps its own tax code, typically 1257L with the usual basic-rate band below higher rate.
- Can D0 change back to BR or 1257L?
- Yes. If your main income drops below the higher-rate threshold, HMRC normally downgrades additional-source codes to BR. Contact HMRC if the code doesn't update automatically after a circumstance change.
Related tax codes
- D1
D1 applies a flat 45% additional rate to 100% of pay from this source. HMRC uses it when your total income already exceeds the £125,140 additional-rate threshold.
- BR
BR applies a flat 20% basic rate to 100% of your pay from that source. No Personal Allowance is given — every pound is taxed.
- 1257L
1257L is the default UK tax code for 2026/27. It gives you the full £12,570 Personal Allowance before Income Tax is deducted.
- K
A K-prefix tax code (e.g. K475) means your taxable deductions exceed your Personal Allowance. The number represents extra taxable income added to your pay, not a tax-free amount.
Sources & further reading
All figures and definitions on this page reflect the 2026/27 UK tax year and are cross-checked against HMRC guidance.
- HMRC — What your tax code means (official meanings for L, BR, D0, D1, K, 0T, NT, M, N, S, C, T)
- HMRC — Income Tax rates and Personal Allowance (2026/27 bands and thresholds)
- HMRC — Emergency tax codes (W1, M1 and X suffixes)
- HMRC — Rates and thresholds for employers 2026 to 2027
- HMRC — Your Personal Tax Account (check your current code and how it was calculated)
- Our methodology & calculation sources →