P9X(2019) Tax Codes To Use

HMRC have now published P9X(2019) which gives employers and payroll professionals guidance on the tax codes and bandings for the 2019/20 tax year.

I have summarised some of the information below.

Personal Allowance

The basic Personal Allowance to use for the 2019/20 tax year is £12,500. This applies to the whole of the United Kingdom (UK).

For those receiving the full Personal Allowance, this means they can earn £240 per week or £1,042 per month before paying tax.

Emergency Tax Code

The new emergency tax code for 2019/20 is 1250L for all employees throughout the UK. 

 

Income Tax Rate and Bandings

 

%

Band

Basic Rate

20%

£1 to £37,500

Higher Rate

40%

£37,501 to £150,000

Additional Rate

45%

£150,001 and above

These are the default rates to be used for anyone in the UK. The different rates will only be used for those with a different pre-fix on their tax codes.

C = Welsh Tax

S = Scottish Tax 

These rates should only be used for those with a C pre-fixed tax code i.e. C1250L

 

%

Band

Basic Rate

20%

£1 to £37,500

Higher Rate

40%

£37,501 to £150,000

Additional Rate

45%

£150,001 and above

These rates should only be used for those with a S pre-fixed tax code i.e. S1250L

 

%

Band

Starter Rate

19%

£1 to £2,049

Basic Rate

20%

£2,050 to £12,444

Intermediate Rate

21%

£12,445 to £30,930

Higher Rate

41%

£30,931 to £150,000

Top Rate

46%

£150,001 and above

The Scottish income tax rates are subject to approval by the Scottish Parliament. This is due on 19 February 2019.

Tax Code Changes

HMRC will normally issue a new tax code for employees electronically or by sending a paper P9(T).

For anyone without a new tax code, you will either need to carry forward their current code or increase it. Most software will do this for you. 

Tax codes to carry forward

You can carry forward the below tax codes into the 2019/20 tax year:

  • BR or SBR
  • D0 or SD0
  • D1 or SD1
  • SD2
  • NT

Tax codes to increase

Tax codes with the below suffixes can be increased by:

  • L – add 65 (1185L becomes 1250L)
  • M – add 71 
  • N – add 59

Do not carry forward an W1 or M1 setting. 

Additional Support

If you would like any help and support with managing statutory leave pay for your employees, do not hesitate to contact us.

Email: support@yourpayrollteam.com

Contact Form: https://yourpayrollteam.com/contact-us/