Personal tax allowance allocation

omleeo

I left my last employer at the end of March 2025 and have received my P45. I have a drawdown pension plan which I have previously accessed and will be accessing in the 2025-2026 tax year. My latest tax code notice from HMRC states that my personal tax free allowance is assigned to my old employer and that any drawdown from my pension will be taxed at 40%. How long before HMRC will amend this based on my P45 being submitted by my old employer? I will not be taking on any new employment. Should I spend a few hours waiting to speak to HMRC to resolve this by phone (I do have the time now!) or leave them to update this? Thanks for any advice

Nomunnofun1

omleeo said:

I left my last employer at the end of March 2025 and have received my P45. I have a drawdown pension plan which I have previously accessed and will be accessing in the 2025-2026 tax year. My latest tax code notice from HMRC states that my personal tax free allowance is assigned to my old employer and that any drawdown from my pension will be taxed at 40%. How long before HMRC will amend this based on my P45 being submitted by my old employer? I will not be taking on any new employment. Should I spend a few hours waiting to speak to HMRC to resolve this by phone (I do have the time now!) or leave them to update this? Thanks for any advice

I wouldn’t wait. Access your personal tax account and update the employer details as ‘ceased’ by entering a leaving date and income from that source in 2025/26 to NIL. 

Sarahspangles

omleeo said:

How long before HMRC will amend this based on my P45 being submitted by my old employer?

I updated my details in the HMRC app (or you can use your personal tax account on gov.uk) - this is what nomunnofun1 is suggesting.

It may be worth knowing that the acknowledgement stated that it will take 15 days to action. So if your former employer’s notification doesn’t reach them first, it will be late April.

Dazed_and_C0nfused

omleeo said:

I left my last employer at the end of March 2025 and have received my P45. I have a drawdown pension plan which I have previously accessed and will be accessing in the 2025-2026 tax year. My latest tax code notice from HMRC states that my personal tax free allowance is assigned to my old employer and that any drawdown from my pension will be taxed at 40%. How long before HMRC will amend this based on my P45 being submitted by my old employer? I will not be taking on any new employment. Should I spend a few hours waiting to speak to HMRC to resolve this by phone (I do have the time now!) or leave them to update this? Thanks for any advice

That stopped over 10 years ago now.

They need to file your final earnings details under the Real Time Information system.  Including the date you left their employment.

That is what HMRC use now in place of a P45.

omleeo

Sarahspangles said:

omleeo said:

How long before HMRC will amend this based on my P45 being submitted by my old employer?

I updated my details in the HMRC app (or you can use your personal tax account on gov.uk) - this is what nomunnofun1 is suggesting.

It may be worth knowing that the acknowledgement stated that it will take 15 days to action. So if your former employer’s notification doesn’t reach them first, it will be late April.

Thanks for your reply. I did log into my personal tax account on gov.uk but couldn’t see where I could update this - it only seemed to show options to add other employers. Am I looking at the wrong section? Is it easier on the HMRC app?

Sarahspangles

omleeo said:

Sarahspangles said:

omleeo said:

How long before HMRC will amend this based on my P45 being submitted by my old employer?

I updated my details in the HMRC app (or you can use your personal tax account on gov.uk) - this is what nomunnofun1 is suggesting.

It may be worth knowing that the acknowledgement stated that it will take 15 days to action. So if your former employer’s notification doesn’t reach them first, it will be late April.

Thanks for your reply. I did log into my personal tax account on gov.uk but couldn’t see where I could update this - it only seemed to show options to add other employers. Am I looking at the wrong section? Is it easier on the HMRC app?

You go into the PAYE section > Check Current Tax Year > [Select your Ex-Employer] > View or Update Employment Details > Update Your Estimated income

In that final screen you have a link to “tell us when your employment ended”. I also set expected income to £0

omleeo

Sarahspangles said:

omleeo said:

Sarahspangles said:

omleeo said:

How long before HMRC will amend this based on my P45 being submitted by my old employer?

I updated my details in the HMRC app (or you can use your personal tax account on gov.uk) - this is what nomunnofun1 is suggesting.

It may be worth knowing that the acknowledgement stated that it will take 15 days to action. So if your former employer’s notification doesn’t reach them first, it will be late April.

Thanks for your reply. I did log into my personal tax account on gov.uk but couldn’t see where I could update this - it only seemed to show options to add other employers. Am I looking at the wrong section? Is it easier on the HMRC app?

You go into the PAYE section > Check Current Tax Year > [Select your Ex-Employer] > View or Update Employment Details > Update Your Estimated income

In that final screen you have a link to “tell us when your employment ended”. I also set expected income to £0

Thanks for your response. I have followed your advice, but having logged in to the HMRC app, weirdly my old employer is now missing (maybe this was co-incidentally updated between my post yesterday and now), but my pension drawdown is still showing, but still states that D0 tax code will be applied - meaning there is no allocation of my personal tax allowance as there are no other employers or sources of income showing. Do you think this will be updated by HMRC and should I give it a couple of days, or would you advise a different approach? I want to drawdown from this pension but don’t want to be deducted 40% and have to try and get my tax code amended and chase a refund from HMRC after the event (I don’t know if the pension provider may automatically deduct 40% at source anyway - I’m not sure if they are aware of individual’s tax position when they process a drawdown). Thank you

Sarahspangles

omleeo said:

Sarahspangles said:

omleeo said:

Sarahspangles said:

omleeo said:

How long before HMRC will amend this based on my P45 being submitted by my old employer?

I updated my details in the HMRC app (or you can use your personal tax account on gov.uk) - this is what nomunnofun1 is suggesting.

It may be worth knowing that the acknowledgement stated that it will take 15 days to action. So if your former employer’s notification doesn’t reach them first, it will be late April.

Thanks for your reply. I did log into my personal tax account on gov.uk but couldn’t see where I could update this - it only seemed to show options to add other employers. Am I looking at the wrong section? Is it easier on the HMRC app?

You go into the PAYE section > Check Current Tax Year > [Select your Ex-Employer] > View or Update Employment Details > Update Your Estimated income

In that final screen you have a link to “tell us when your employment ended”. I also set expected income to £0

Thanks for your response. I have followed your advice, but having logged in to the HMRC app, weirdly my old employer is now missing (maybe this was co-incidentally updated between my post yesterday and now), but my pension drawdown is still showing, but still states that D0 tax code will be applied - meaning there is no allocation of my personal tax allowance as there are no other employers or sources of income showing. Do you think this will be updated by HMRC and should I give it a couple of days, or would you advise a different approach? I want to drawdown from this pension but don’t want to be deducted 40% and have to try and get my tax code amended and chase a refund from HMRC after the event (I don’t know if the pension provider may automatically deduct 40% at source anyway - I’m not sure if they are aware of individual’s tax position when they process a drawdown). Thank you

I think I’d wait until Monday to see what it says then, and if you don’t have a new notice of coding, call.