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  • Self Assessment - Personal Allowance not taken into consideration

    Hi - I am completing by Self Assessment for financial year ending April 2022. I am a full-time employee (1 employment only) and tax is deducted from my income. My P60 has a PAYE code, which I have indicated in my Self Assessment form. The assessment calculation shows my personal allowance of approx. £2,000 that is tax-free; as compared to my tax code of 1257L, which implies a personal allowance of £12,570. Per the calculation, I owe approx. £4,500 now in tax, as I am due to pay additional tax on approx. £10,570 of income that is not included in my personal allowance (GBP 12,570 - GBP 2,000), but not sure I understand why my personal allowance is lesser (£2,000) than per my tax code (£12,570). Appreciate HMRC's explanation on this please. Thank you.