We'd like to remind Forumites to please avoid political debate on the Forum. This is to keep it a safe and useful space for MoneySaving discussions. Threads that are - or become - political in nature may be removed in line with the Forum’s rules. Thank you for your understanding.
What is the impact of a non cumulative 'X' tax code, is it bad?

isayhello
Posts: 455 Forumite


I have had my tax code changed from 1257L to 1200 L X. I've been reading about tax codes and saw that the 'X' means its now a non cumulative tax code, if I keep working full time till the end of the tax year will there be any impact on me, will I have overpaid tax? Is it a bad thing to have the 'X' code?
I've not seen an exampe with some working out to see the real impact it will have on me, if someone could explain that would be very helpful, thanks.
I've not seen an exampe with some working out to see the real impact it will have on me, if someone could explain that would be very helpful, thanks.
0
Comments
-
Your monthly salary will be worked out on the basis of a tax allowance of £1,000 per month going forward. That's what it means.1
-
HMRC have reduced your tax code so that each month from now on you will pay extra tax above what you would have paid on 1257L code. If they had used a cumulative tax code the reduction would have been backdated to the beginning of the tax year and the first payment you had after the reduction would have included both the extra tax due to the reduction but also extra to backdate it to the start of the tax year.
As to the impact it has on you that will depend on why it has been reduced, have you had an advice of code change?1 -
chrisbur said:HMRC have reduced your tax code so that each month from now on you will pay extra tax above what you would have paid on 1257L code. If they had used a cumulative tax code the reduction would have been backdated to the beginning of the tax year and the first payment you had after the reduction would have included both the extra tax due to the reduction but also extra to backdate it to the start of the tax year.
As to the impact it has on you that will depend on why it has been reduced, have you had an advice of code change?0 -
penners324 said:Your monthly salary will be worked out on the basis of a tax allowance of £1,000 per month going forward. That's what it means.0
-
isayhello said:penners324 said:Your monthly salary will be worked out on the basis of a tax allowance of £1,000 per month going forward. That's what it means.
1 -
isayhello said:penners324 said:Your monthly salary will be worked out on the basis of a tax allowance of £1,000 per month going forward. That's what it means.
Most people would probably prefer to pay the extra over the rest of the tax year not in one go next pay day.
And where would the cut off be, should £50 be paid in one go, £200, £500?1 -
Dazed_and_C0nfused said:
Most people would probably prefer to pay the extra over the rest of the tax year not in one go next pay day.
And where would the cut off be, should £50 be paid in one go, £200, £500?
if you've paid £1000 in tax already after say 6 months and earned £18000 then how does that reduction in allowance affect what you've paid since April? it would only affect your new earnings and still be spread out over each month right?0 -
A non cumulative code (signified by the X) is where the employer or pension payer is good to use the new code in isolation on every pay day from now on i.e. that week or months pay is calculated using the non cumulatibe code with no regard of what happened in previous week's or months.
A cumulative code is where the employer or pension payer will add the next week or months pay to what you have already received and calculate the tax due on the total (since 6 April). Then knock off the tax that has already been paid and deduct the balance from that payment. So if your tax code drops more than a point of two then you have to pay all the tax owed back to April all in one go on that payslip.
0 -
Dazed_and_C0nfused said:A non cumulative code (signified by the X) is where the employer or pension payer is good to use the new code in isolation on every pay day from now on i.e. that week or months pay is calculated using the non cumulatibe code with no regard of what happened in previous week's or months.
A cumulative code is where the employer or pension payer will add the next week or months pay to what you have already received and calculate the tax due on the total (since 6 April). Then knock off the tax that has already been paid and deduct the balance from that payment. So if your tax code drops more than a point of two then you have to pay all the tax owed back to April all in one go on that payslip.0 -
isayhello said:Dazed_and_C0nfused said:A non cumulative code (signified by the X) is where the employer or pension payer is good to use the new code in isolation on every pay day from now on i.e. that week or months pay is calculated using the non cumulatibe code with no regard of what happened in previous week's or months.
A cumulative code is where the employer or pension payer will add the next week or months pay to what you have already received and calculate the tax due on the total (since 6 April). Then knock off the tax that has already been paid and deduct the balance from that payment. So if your tax code drops more than a point of two then you have to pay all the tax owed back to April all in one go on that payslip.
1
Confirm your email address to Create Threads and Reply

Categories
- All Categories
- 348.8K Banking & Borrowing
- 252.3K Reduce Debt & Boost Income
- 452.6K Spending & Discounts
- 241.6K Work, Benefits & Business
- 618.2K Mortgages, Homes & Bills
- 176K Life & Family
- 254.7K Travel & Transport
- 1.5M Hobbies & Leisure
- 16.1K Discuss & Feedback
- 15.1K Coronavirus Support Boards