Second job tax calculator

Income tax is charged on your total income from every job, while each payroll only sees its own pay. So HMRC gives each job its own tax code. Your main job normally gets your allowance as 1257L. The second job gets a code that taxes it at the rate your total income reaches.

In Scotland the codes start with S and use Scottish rates: SBR 20%, SD0 21%, SD1 42%, SD2 45% and SD3 48%. In Wales they start with C and use Welsh rates, which match England's.

The most common overpayment comes from a main job that pays less than £12,570. Payroll gives that job your whole allowance, the job uses only part of it, and the second job's BR code taxes every pound at 20%. With £8,000 from one job and £10,000 from another, you pay £2,000 through PAYE on income that owes £1,086, an overpayment of £914.

You can also overpay when the second job has a D0 code but your total income stays in the basic rate band, or when an emergency code is used while HMRC waits for your details. HMRC refunds overpayments after the tax year ends, usually by sending a P800 calculation, or sooner if your codes are corrected during the year.

If your main job does not use your full allowance, ask HMRC to move the unused part to your second job. With £8,000 from the main job, HMRC can give it a code of 800L and the second job 457L, so the second job's first £4,570 is tax-free. The second job then pays £1,084.20 a year in tax in place of £2,000, and the year ends with nothing to reclaim.

You can tell HMRC about your income and check your codes with its Check your Income Tax service, in the HMRC app or by phone. Update it if your hours change, because a split only works while each job pays roughly what HMRC expects.

If your total income goes over £50,270 and the second job is still on BR, the part above that line is taxed at 20% when it should be 40%. On a £60,000 salary with a £10,000 second job, that leaves £2,004 to pay. HMRC usually collects it by lowering your tax code the following year, or asks you to pay it directly. To avoid a bill, ask HMRC for a D0 code on the second job.

Above £100,000 of total income your allowance starts to shrink as well, which the 60% tax trap calculator explains.

Each job has its own National Insurance thresholds, so NI is worked out on each job's pay separately. A second job paying less than £1,048 a month takes no employee NI, and two jobs can pay less NI than one job with the same total pay. A £30,000 job and a £20,000 second job pay £1,987.80 of NI between them, against £2,993.88 on a single £50,000 salary.

Jobs with the same employer are normally added together for NI, and so are jobs with employers who carry on business in association. If you already pay NI in another job, you may be able to defer some of it so a job takes only 2% (category letter J).

For your State Pension, a job counts towards a qualifying year when it pays at least £129 a week, or £559 a month. Each job is checked on its own, so two small jobs can leave a gap in your National Insurance record. The National Insurance calculator shows the NI on each payday.

Each employer applies your student loan threshold to its own pay, so a second job below the threshold for its pay period takes nothing, even if your total income is above it. If you file a Self Assessment return, repayments are worked out on your total income and any shortfall is collected then. The student loan repayment calculator has the thresholds for every plan.