If you have noticed 1257L M1 or simply M1 on your payslip and are unsure what it means, you are in exactly the right place. The M1 tax code is a temporary emergency tax code issued by HM Revenue and Customs (HMRC) when they do not yet have sufficient information to assign you the correct cumulative tax code.
It is not a penalty, and it does not indicate you have done anything wrong. However, it almost always means you are paying more Income Tax than you should be. Understanding what it is, why you have it, and how to resolve it quickly can put more money back in your pocket every month.
In this comprehensive guide you will learn:
- What the M1 tax code means in plain English
- Why HMRC assigns it and the most common triggers
- How it affects your monthly take-home pay, with a worked example
- What 1257L M1 looks like on your payslip
- How to change your M1 tax code as quickly as possible
- What happens after your code is corrected, including tax refunds
- Other related emergency tax codes to be aware of
What Is the M1 Tax Code?
The M1 tax code is an emergency tax code used by HMRC within the Pay As You Earn (PAYE) system. The suffix ‘M1’ stands for ‘Month 1’ and instructs your employer to calculate your Income Tax on a non-cumulative, month-by-month basis rather than across the full tax year.
Under a standard cumulative tax code — such as the widely used 1257L for the 2025/26 tax year — your employer considers your total earnings and total tax paid since 6 April each time payroll is processed. Any unused personal allowance from earlier months carries forward, reducing your tax liability in subsequent months.
With the M1 tax code, this backward-looking calculation is completely switched off. Every month is treated in total isolation, as though it were the very first pay period of the tax year. You receive just one-twelfth of your annual personal allowance (£12,570 ÷ 12 = £1,047.50 for 2025/26), regardless of how long you have been employed or how little you earned in previous months.
What Does Tax Code M1 Mean?
In practical terms, tax code M1 means your employer treats every pay day as a completely fresh start. Two significant consequences follow:
- Your unused personal allowance from previous months is disregarded. If you were not working for the first six months of the tax year, you would ordinarily have accumulated six months of untaxed allowance. The M1 code effectively wipes this out.
- You are very likely to overpay Income Tax compared to someone on a cumulative code earning the same salary.
HMRC applies the M1 code as a precautionary holding measure — ensuring some tax is collected in the interim while they gather the details needed to calculate your tax correctly.
Why Have I Been Given the M1 Tax Code?
There is rarely a single cause. HMRC applies the M1 code whenever they lack sufficient information to issue an accurate cumulative code. The most common reasons include:
Starting a New Job Without a P45
If you begin a new role without providing your employer a P45 — the document issued by your previous employer detailing your pay and tax figures for the current year — HMRC will not have the data they require. Your employer will ask you to complete a Starter Checklist (formerly known as a P46). Depending on which statement you select, you may be placed on an emergency code such as 1257L M1.
Changing Jobs Mid-Year
Even when a P45 is available, processing delays or administrative oversights can result in HMRC temporarily applying an emergency code while they update their records. HMRC systems can take up to 35 days to update after receiving new information from your employer.
Having Multiple Jobs
If you work for more than one employer simultaneously, HMRC may apply an emergency code to your secondary employment while calculating how to split your personal allowance. Typically, your main job receives the standard 1257L code, while your secondary job receives either a BR code (Basic Rate, 20%) or an M1 variant.
Taking a Pension Lump Sum
Withdrawing a taxable lump sum from a defined contribution pension can trigger the M1 code if your provider does not hold a specific tax code from HMRC. This can lead to significant overtaxation, as HMRC’s system initially treats the lump sum as a regular monthly payment — projecting it as a far higher annual income than it actually is.
Changes in Employment Status
Moving from self-employment into PAYE employment, returning to work after a period of unemployment or sick leave, or transitioning from gig economy work to a salaried role can all trigger the M1 code while HMRC catches up with your updated circumstances.
Missing or Outdated Tax Information
If your personal details with HMRC have not been updated — following a change of address, marital status, or income source — they may default to the M1 emergency basis until your records are refreshed.
How Does the M1 Tax Code Affect Your Income?
The core impact is clear: you are likely to pay more Income Tax than you actually owe during any months spent on the M1 code.
Cumulative vs Non-Cumulative Tax Calculation
Under a cumulative PAYE calculation, your employer accounts for the entire tax year to date. If you were unemployed from April to October and started a new job in November, you would have built up seven months of unused personal allowance (7 × £1,047.50 = £7,332.50). A cumulative code applies this unused allowance against your November wages, meaning you could earn a considerable amount before paying any tax.
Under the M1 code, none of that previous context applies. Your employer simply grants you £1,047.50 of allowance for November and taxes the remainder at the standard rate.
Worked Example (2025/26 Tax Year)
Suppose you were unemployed from 6 April 2025 and started a new job on 1 January 2026, earning £2,500 per month. Here is how your January tax bill compares under each code:
| Scenario | Tax-Free Allowance Applied | Taxable Income | Income Tax Deducted |
|---|---|---|---|
| Standard 1257L (cumulative) | £12,570 (full year’s unused allowance) | £0 | £0 |
| M1 Emergency Code | £1,047.50 (one month only) | £1,452.50 | £290.50 |
| Difference (overpayment) | — | — | £290.50 |
As the table illustrates, you could overpay nearly £291 in a single month solely due to the M1 code. If the code persists for the remaining five months of the tax year, the total overpayment could exceed £1,450 — money HMRC owes you back, but which takes time to reclaim.
What Does the M1 Tax Code Look Like on Your Payslip?
On your payslip, the tax code is usually displayed in a dedicated field near your employee number or name, typically labelled ‘Tax Code’ or ‘T. Code’. For the 2025/26 tax year, the M1 code will appear in one of the following formats:
| Tax Code on Payslip | What It Means |
|---|---|
| 1257L M1 | Standard personal allowance (England/Northern Ireland), applied on a Month 1 emergency basis |
| S1257L M1 | Scottish taxpayer — same emergency basis, but Scottish Income Tax rates apply |
| C1257L M1 | Welsh taxpayer — same emergency basis, Welsh rates (aligned with England for 2025/26) |
| SK1257 M1 | K code: deductions exceed allowances; still applied on Month 1 basis |
| 0T M1 | Zero personal allowance — all income taxed; Month 1 basis applied |
The crucial identifier to look for is the ‘M1’ suffix. This alone confirms your tax is being calculated on a non-cumulative emergency basis. The numbers preceding it indicate your personal allowance amount, and any letter prefix identifies your tax region.
How Can I Change My M1 Tax Code?
The M1 tax code is temporary and generally straightforward to resolve. Your goal is to provide HMRC with the information they need to issue a corrected cumulative PAYE Coding Notice (P2) to both you and your employer.
Step 1: Provide Your P45 to Your New Employer
If you have recently changed jobs, the fastest resolution is to hand your new employer your P45 from your previous role as soon as possible. The P45 contains your tax reference, your previous tax code, and your cumulative pay and tax figures for the current year. Your employer forwards this to HMRC, who can then update your code promptly.
If you do not have a P45 — because this is your first job, you have been unemployed, or your previous employer has not yet issued one — complete the Starter Checklist provided by your new employer. Answer all questions honestly, as your responses determine which interim code is applied.
Step 2: Update HMRC via Your Personal Tax Account
The most reliable self-service option is to log in to your Personal Tax Account on GOV.UK or through the HMRC mobile app. Once logged in, you can:
- Check your current tax code and view a full breakdown
- Update your employment details including new employer and income changes
- Notify HMRC of changes to pensions or taxable benefits
- Request a code review if you believe your code is incorrect
After updating your details, HMRC will review your records and issue a revised cumulative code. Your employer will receive a P2 Coding Notice and apply the new code in the next available payroll run.
Step 3: Contact HMRC by Phone
If the matter cannot be resolved online, you can call the HMRC Income Tax helpline:
- Telephone:+44 20 3885 6282
- Hours: Monday to Friday, 8am to 6pm
- Have ready: your National Insurance number, the tax code shown on your payslip, and any P45 or P60 documents
HMRC agents can update your record directly during the call and arrange for a corrected code to be issued without delay.
What Happens After Your M1 Tax Code Is Corrected?
Once HMRC issues your new cumulative code and your employer applies it, two things happen automatically:
- Going forward, your Income Tax will be calculated correctly on a cumulative basis, accounting for everything earned and paid since 6 April.
- If the cumulative calculation reveals an overpayment during the period you were on the M1 code, the excess will be refunded directly through your payroll — typically appearing as higher net pay in your very next payslip.
This is one of the key advantages of the PAYE system: your employer’s payroll software handles the reconciliation automatically, meaning you do not need to submit a formal tax return in most cases.
What If You Stay on the M1 Code Until the End of the Tax Year?
If the M1 code remains in place until 5 April 2026 — the end of the 2025/26 tax year — HMRC will conduct a post-year-end reconciliation once your employer submits their final PAYE submissions. HMRC will then issue a P800 tax calculation letter (typically in June or July following the tax year end) indicating whether you have overpaid or underpaid.
If the P800 confirms a refund is due, you must actively claim it — it will not be paid automatically. The simplest method is via your Personal Tax Account or the HMRC app, where you can request payment directly to your bank account. If you do not claim online within 45 days, HMRC will issue a cheque instead.
M1 Tax Code and Pension Withdrawals
Pensioners taking flexible withdrawals from a defined contribution pension face a particular risk with the M1 code. When you make your first lump sum withdrawal in a tax year and your provider does not hold a tax code from HMRC, they are legally required to deduct tax on a Month 1 emergency basis.
This means HMRC’s system temporarily treats the lump sum as a recurring monthly income. For example, a single withdrawal of £10,000 would be taxed as though your annual income were £120,000 — potentially attracting the 40% or even 45% higher rate — rather than being taxed correctly against your actual annual income.
The resulting overpayment can be substantial. Fortunately, HMRC provides specific repayment forms to address pension overtaxation:
- Form P50Z — if you have emptied your pension pot and have no other income
- Form P53Z — if you have taken a small pots payment or trivial commutation lump sum
- Form P55 — if you have only partially withdrawn from your pension and have no other taxable income
Submitting the appropriate form can secure a refund within 30 days, rather than waiting until after the tax year end.
Other Emergency Tax Codes You May Encounter
The M1 code is one of several emergency or non-standard tax codes used by HMRC:
| Tax Code | Meaning | Who It Applies To |
|---|---|---|
| 1257L W1 | Week 1 emergency — same as M1 but for weekly payroll | Weekly-paid employees |
| 1257L M1 | Month 1 emergency — non-cumulative monthly calculation | Monthly-paid employees/pensioners |
| 1257L X | Non-standard pay periods — non-cumulative basis | Irregular pay periods |
| BR | Basic Rate — all income taxed at 20%, no personal allowance | Secondary jobs/pensions |
| 0T | Zero personal allowance — all income taxed at applicable rates | No allowance situations |
| 0T M1 | Zero allowance on a Month 1 emergency basis | No allowance + emergency basis |
| K codes | Deductions exceed allowances — effective negative allowance | Benefits-in-kind, underpaid tax |
Key Takeaways: M1 Tax Code at a Glance
| Feature | Detail |
|---|---|
| What it is | A temporary, non-cumulative emergency tax code |
| What ‘M1’ stands for | Month 1 — tax calculated as if each month is the first of the year |
| Personal allowance applied | £1,047.50 per month (£12,570 ÷ 12) for 2025/26 |
| Main impact | Likely Income Tax overpayment; unused allowance from earlier months ignored |
| Most common trigger | Starting a new job without submitting a P45 or Starter Checklist |
| How to fix it | Provide P45 to employer; update via Personal Tax Account or call 0300 200 3300 |
| Overpaid tax | Refunded automatically through payroll once corrected, or via P800 after year end |
| 2025/26 standard code | 1257L M1 (England/N. Ireland); S1257L M1 (Scotland); C1257L M1 (Wales) |
The Bottom Line
The M1 tax code is a temporary emergency measure that often results in overpaying Income Tax. While it is not a cause for alarm, resolving it promptly is always in your best financial interest. Whether you fix it by submitting your P45, updating your Personal Tax Account, or calling HMRC directly, the sooner you act, the sooner your tax is calculated correctly — and any overpayment is returned to you.
For expert tax guidance and personalised support with your PAYE code or any other tax matter, Accofirm is here to help.