A D1 tax code means every pound of that income is taxed at the additional rate of 45%, with no Personal Allowance applied. It is the top-rate version of the D0 code, where D0 taxes everything at 40%, D1 taxes everything at 45%.
This is part of our UK tax codes explained series.
What does D1 mean?
The D prefix means a single flat rate applies to the whole of this income, and 1 points to the additional rate (45%). As with D0, there is no allowance and no banding, just a flat 45% on everything paid under the code.
Why do I have a D1 tax code?
D1 appears on a second income when your main income already fills the higher-rate band and reaches the additional rate. At that point every extra pound really is taxed at 45%, so HMRC codes the second source at D1 so the right tax is taken as you earn.
How D1 fits the D-code family
| Code | Flat rate on that income | Typical use |
|---|---|---|
| BR | 20% | Second income, main job in basic rate |
| D0 | 40% | Second income, main job in higher rate |
| D1 | 45% | Second income, main job into additional rate |
What to do if the code is wrong
If you think your tax code is wrong, do not just wait, an incorrect code is corrected from the date HMRC updates it, and any over- or under-payment is squared up afterwards. Steps to take:
- Check your latest tax code notice (the "PAYE Coding Notice", form P2) in your HMRC personal tax account. It shows how the code was built up.
- Compare it to your real situation, one job or several, any benefits in kind, untaxed income, or earlier-year underpayments being collected.
- Confirm your total income really reaches the additional rate. If it does not, D1 over-taxes you, ask HMRC to recode to D0 or BR as appropriate.
- Tell HMRC if anything is out of date, online, via the HMRC app, or by phone. They will issue a revised code to your employer.
- Watch your next payslip to confirm the new code has been applied and any refund has come through.
Frequently asked questions
How much tax does a D1 code take?
A flat 45% of the income paid under that code, with no tax-free amount, so £1,000 of pay means £450 of tax.
Is D1 only for very high earners?
It applies when your other income has already filled the higher-rate band, which happens at higher income levels. If your total income does not reach the additional rate, D1 is likely too high.
Can I reclaim tax if D1 was wrong?
Yes. Once the correct code is in place, any overpayment is reconciled, either through your pay or by HMRC after the tax year.
Think your tax code is wrong? It is one of the most common payroll errors, and HMRC will not always spot it for you. Zmartly's Self Assessment and personal tax team can check your code against your circumstances and deal with HMRC on your behalf. Get in touch for a free review, or book a free Tax Health Check.
