How do K tax codes work?

john_kent

Just had a recode from K132 to K232.

How do K taxcodes work?

Will I be worse or better off?

My car was changed from a gas guzzler to a eco car several months ago and my HR are saying thats why its changed

kazwookie

From HMRC

http://www.hmrc.gov.uk/incometax/codes-basics.htm#3

john_kent

SO I am worst off?

Brilliant

jennifernil

To get a K code you usually have a second income that has not been taxed (like State Pension for example), has this income increased?

AuntyCat

A K code is basically a negative code, so yes you're worse off. it does seem a bit odd as car benefits are worked out on the CO2 emisions of the car, although the price of the car is also taken into account so if you now have a more expensive car it could be right.
I'm sure there's somthing on HMRC website where you can work out what it should be from the co2 etc.

System

Call HMRC and ask how the K code is calculated. As a previous poster said a K code is a negative code which means the deductions against your personal tax free allowance are greater than that allowance and so when you take the deduction from the allowance you get a minus number.

john_kent

I will talk to HMRC as colleagues who received the same swap have seen a decrease in the tax they pay.