What is the impact of a non cumulative 'X' tax code, is it bad?

Dazed_and_C0nfused

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.

Do you mean, if you're now in October and your code drops a few points, then if every month previously you were paying £100 in tax, it would be recalculated and now you might have to pay £120 in tax. So on your next payslip, all those previous months would have £20 added to them, and you'd pay an extra £120 for those 6 months in one go? whereas now you might be paying £130 per month for the next 6 months or something like that?

Pretty much yes