New Income Tax code at 259L

Hello, Last year, after I submitted my Self assessment around July, I had to pay circa £1,800 back due to Child Benefit - as my income was above 60k. I agreed this to be deducted from my salary over the rest of the tax year. My Tax code changed from 1257 to 384. Recently I got my Tax code letter for next financial year - 23-24. However I can't understand below : 1. Why my tax code has decreased further to 259. 2. Why is there an underpayment of £1,373 when whatever I owe is already being deducted from my salary by means of this lower tax code which changed around July 3. On what basis is my next year's underpayment showing as £4,895 I'm very confused on how these numbers are deduced. Am I doing something wrong? Will appreciate any help/guidance you can provide to understand this. I've copied below the Income Tax comparison for me from HMRC site. Thank You. --------------------------------------------------------------------------------------------------------------------------------------------------------------------------- Tax codes Employer or pension Current tax year ends 5 April 2023 Next tax year from 6 April 2023 ------ 384LX 259L Tax-free amount Your tax-free amount is the income you can have before paying tax. Your Personal Allowance may be different depending on your circumstances. Personal Allowance How we calculate it Current tax year ends 5 April 2023 Next tax year from 6 April 2023 Personal Allowance £12,570 £12,570 Additions Additions Current tax year ends 5 April 2023 Next tax year from 6 April 2023 Gift Aid Payments £175 £175 Job expenses £312 £312 Deductions Deductions Current tax year ends 5 April 2023 Next tax year from 6 April 2023 Underpayment from previous year £1,373 £4,895 Child Benefit £4,712 £5,187 Estimated tax you owe this year £2,743 not applicable Your total tax-free amount Your total tax-free amount Current tax year ends 5 April 2023 Next tax year from 6 April 2023 Your total tax-free amount £3,849 £2,595

Hi ren souza,

You will need to contact our helpline so that we can view the tax code on the system to see exactly what the underpayment figure is for.

Self Assessment

Thank you. 

Hi David AU,

Yes, you use the oldest year first as this will expire first.

Further help is available here: 

Pension savings — tax charges (Self Assessment helpsheet HS345)

Thank you.