🗂️ PAYE Allowance with Multiple Jobs

One Allowance, Multiple Income Sources

Everyone gets one Personal Allowance — £12,570 for the 2025/26 tax year. But if you have two or more jobs (or a job plus a pension), HMRC only gives that allowance to one employer. The other income source will normally use a tax code that taxes all of it — this is why second jobs often show up with a BR code.

This is technically correct: your allowance is applied once across your total income. But it often feels wrong because you're paying 20% tax on every pound from job #2, even if your total income is modest.

Which Job Gets the Allowance?

By default, HMRC allocates your allowance to the job it knows pays you the most — typically your main employer. That's the smart choice, because your highest-paying job usually has the highest marginal tax rate, so the tax-free amount has the biggest impact there.

But you can change this. If you want the allowance applied to a different job, you can call HMRC (0300 200 3300) or complete form P55 (if you've left a job) or P50 (if you've stopped working). You can also update your preferences through your Personal Tax Account.

Common Multi-Job Tax Codes

Scenario: Two Part-Time Jobs

Let's say you work 20 hours a week at £12/hr in one job, and 15 hours a week at £14/hr in another. Your total annual income is roughly £23,400 — well below the £50,270 Higher Rate threshold.

With the allowance on your main job, you'd pay no tax on the first £12,570 of job #1, then 20% on the rest. Job #2 gets BR, so 20% on every pound. That works out correctly — you're just paying 20% on all income above £12,570 combined.

Many people in this situation are surprised by the BR code on job #2, but it's usually correct. The real problem arises when both jobs use 1257L — meaning you get £25,140 tax-free. That's wrong, and HMRC will collect the difference later, often through a tax code adjustment that can sting.

When You Might Be Overtaxed

• Your allowance is given to a low-paying job while your high-paying job uses BR — a mistake HMRC sometimes makes.
• One of your jobs is temporary or seasonal, and you end the year with unused allowance.
• You have multiple pensions in payment simultaneously — same rules apply.
• You changed jobs mid-year and the new employer put you on an emergency code.

How to Split Your Allowance Manually

1. Log in to gov.uk/personal-tax-account
2. Go to the "Update your income and tax details" section
3. Find the area for "Split your tax-free amount between jobs"
4. Enter the allocation you want — you can split £12,570 any way (e.g. £6,000 / £6,570)

HMRC will update your codes for both jobs, usually within a few weeks. Your employer doesn't need to do anything beyond accepting the updated code from HMRC's system.

What If You Still End Up Owing?

If you've underpaid across the year — because both jobs gave you the allowance, for example — HMRC can:

• Adjust your tax code the following year to collect it gradually (most common)
• Issue a Simple Assessment bill if you're self-employed as well
• Send a P800 tax calculation with a repayment or a bill

Pensions Count as Income

If you're drawing a State Pension plus a workplace pension, or two personal pensions at once, the same rules apply. Your State Pension usually can't share your Personal Allowance with an employer, so the whole thing may be allocated to one pension provider. If the other pension is small, you might see a BR code on it even though you owe little or no tax overall.

Contact HMRC if your only income is pensions and you're paying tax on one of them — you may be able to reclaim or split the allowance more fairly.

Keep Records

The multi-job tax system is automated and generally reliable, but errors happen. Keep your P45s, P60s, and payslips for at least 4 years. You'll need them if you dispute a tax code or apply for a refund after the tax year ends (you usually have 4 years to claim).