What’s an M1 tax code? Emergency tax codes explained

Picture this: you open your first payslip from a new job, expecting a nice number, but what you see is smaller than you thought. 

Then you see it: the M1 tax code. But what is tax code M1, and why has HMRC given it to you? 

In this guide, we’ll walk you through what the emergency M1 tax code means, who gets emergency taxed, and why. Although it might seem alarming, it’s usually nothing to worry about.

Note: M1 tax codes only exist in the Pay As You Earn (PAYE) system. If you’re a sole trader with no PAYE income, feel free to skip this. If you’re a limited company director paying yourself or an employee via PAYE, this one’s for you. 

Key takeaways

• M1 stands for Month 1 — it’s a temporary, non–cumulative tax code
• It’s usually applied when HMRC doesn’t have your full income history yet
• It can mean you’re taxed more than you should be, at least for a month or two
• It normally sorts itself out — but you can speed things up if needed

An emergency tax code is HMRC’s way of making sure you still pay the right amount of tax while it works out your full income picture. 

You’ll usually see one when starting a new job without a P45, starting a pension alongside your salary, or moving from self–employment into PAYE work. 

Essentially, it tells your employer to calculate your tax on a non–cumulative basis.

What does non–cumulative mean? This is when you’re only taxed on what you earn in the current pay run, ignoring what you earned or paid previously in the tax year. 

Normally, tax is worked out cumulatively, with HMRC spreading your tax–free personal allowance (£12,570 for the 2026/27 tax year) evenly across everything you’ve earned so far this year. 

With M1, that goes out the window. Each month is treated in isolation, as if it were the first month of the tax year, every time.

Shall we look at an example? Let’s say your tax code is 1257L M1 and you earn £3,000 in a month. Your employer gives you one–twelfth of your annual personal allowance for that month, then taxes the rest as normal, without factoring in what you earned before.

If your income varies month to month, which is common if you’re drawing dividends alongside a director’s salary, this can mean you pay more tax than you owe.

There are a few common scenarios that tend to trigger the M1 tax code:

• Starting a new job without a P45 from your last employer
• Starting to draw a pension alongside employment income
• Moving from self–employment into a PAYE role
• Having more than one job or income source at once
• HMRC updating your code mid–year and using M1 to avoid an inaccurate recalculation

You might also see the code written as W1/M1. Essentially, it’s the same thing, just for weekly pay. 

W1 (week 1) is the weekly equivalent of M1 (month 1). The non–cumulative method is identical for both weekly and monthly pay.

You don’t really need to change your tax code yourself because it’s usually corrected automatically within a pay cycle or two. 

If it’s been more than a couple of pay cycles and nothing’s changed, it’s a good idea to check your code via your Personal Tax Account and give HMRC a nudge. 

If you’ve recently started a new job and haven’t given your employer a P45, make sure your employer has your latest details. 

Tip: This handy new starter checklist will help your employer work out your tax code if you don’t have a P45.

It’s very possible, yes. 

Because M1 doesn’t account for your full–year allowance, it’s possible to overpay while you’re on it. 

HMRC usually catches this once your correct code is applied. They then adjust your future pay to balance things out. If the tax year ends while you’re still overpaid, you can claim it back directly from HMRC. 

Your personal tax account is the best place to check this because it’ll show whether you’re due a refund and let you claim it online. 

Tip: It’s always worth keeping a note of your payslips from the months you were on M1. If your tax code hasn’t corrected itself by the end of the tax year, having these on hand makes it much quicker to claim back what you’re owed from HMRC.

If you’re running payroll, there’s usually not much for you to do.

HMRC sends an updated code once it’s matched your employee’s records, and your payroll software applies it automatically. 

It’s worth asking new starters to submit a starter checklist (if they haven’t submitted a P45) as soon as possible. This is what helps HMRC assign the right code sooner.

“M1 codes are designed to self–correct, so there’s never really anything for you to chase up. The best thing you can do is make sure your new starters get their paperwork in early, and let HMRC and your payroll provider handle the rest.”

Expert tip from Countingup’s CEO and small business expert, Tom Platt: “M1 codes are designed to self–correct, so there’s never really anything for you to chase up. The best thing you can do is make sure your new starters get their paperwork in early, and let HMRC and your payroll provider handle the rest.”

The word “emergency” can trigger alarm bells, but the M1 tax code is really just HMRC keeping your tax payments ticking along while they get your full employment picture. 

In almost all cases, it fixes itself — and if you’ve overpaid, you’ll get that money back.

In the meantime, if you’re getting your business off the ground, a business bank account keeps your personal and business finances separate and can help you get tax–ready.

Haven’t taken the leap yet? Our easy company registration service has you covered — you’ll be ready to trade within 24 hours.

For more small business tips and advice, head over to our resource hub and discover the ways you can grow your business. 

Yes. 0T M1 means you’re given no personal allowance at all for that month, on top of the usual non–cumulative M1 calculation. It tends to appear when HMRC has even less information than usual. For example, if your employer has no tax code details for you at all.

You might be — it depends on how your income varies month to month. Because M1 ignores earlier earnings in the year, fluctuating income can lead to overpayment. It usually corrects itself once HMRC updates your record, and any overpaid tax is refunded.

Not directly. M1 only applies to income taxed through PAYE, so if you aren’t paying yourself that way, it won’t come into play. It’s only relevant if you’re drawing a salary through PAYE — as a director, say, or through separate employment. Sole traders can employ staff via PAYE but can’t pay themselves via their own payroll. For more on how tax codes work generally, see our guide on what does the 1257L tax code mean?