What is a Split Tax Code?

A split tax code is assigned when your tax-free personal allowance is divided between two or more sources of income, such as two jobs or a job and a pension. Here's how you can get a split tax code and how it works:

1. Understanding the Need for a Split Tax Code 

If you have multiple sources of income, such as:

   - Two or more jobs

   - A job and a pension

   - Multiple pensions

   HMRC needs to ensure that your Personal Allowance (the amount you can earn before paying tax) is allocated appropriately across your income sources, so you're taxed correctly.

2. How Split Tax Codes Work 

Your Personal Allowance, which for most people is £12,570 for the 2023-2024 tax year, is split between your different sources of income. HMRC will assign different tax codes for each income, ensuring that:

   - You get the full benefit of your Personal Allowance across both sources of income.

   - You don't pay too much or too little tax by default on either source.

3. Requesting a Split Tax Code 

HMRC usually assigns a split tax code automatically, but you may need to request it if it hasn't been done. Here's how:

   - Step 1: Contact HMRC 

     Reach out to HMRC via phone or online (using your personal tax account) and explain that you have more than one source of income. You can do this by:

     - Calling HMRC at 0300 200 3300 (UK) or +44 135 535 9022 (if you're abroad).

     - Using the Check your Income Tax online service to update details.

   - Step 2: Provide Details of Your Income 

     You'll need to provide information about your:

     - Job(s)

     - Pension(s)

     - Any other income

     Specify how you want your Personal Allowance to be divided between your sources of income if you have a preference.

   - Step 3: Wait for HMRC to Issue New Tax Codes 

     Once HMRC processes your request, they will issue new tax codes for each source of income. For example:

     - Job 1: Tax code 647L (representing £6,470 of your Personal Allowance).

     - Job 2: Tax code 610L (representing £6,100 of your Personal Allowance).

4. What Happens Next 

Once HMRC has updated your tax codes:

   - They will notify your employers or pension providers of the changes.

   - Each income source will use the correct tax code, ensuring you receive the right amount of tax-free income at each.

5. Review Your Tax Codes Regularly 

You should check your tax codes periodically or after significant changes in your income (e.g., new job, increase in pension) to ensure they are still accurate. If you notice any issues, contact HMRC to adjust the split.

Common Situations for a Split Tax Code

- Main job and a second job: Your main job will likely use the majority of your Personal Allowance, and the second job will have a smaller portion.

- Pension and part-time job: If you receive a pension and work part-time, HMRC will split your Personal Allowance between the two.

This way, you'll avoid overpaying or underpaying tax.