Tax codes one by one
D1 tax code
The top flat-rate code outside Scotland: every pound of this income at the additional rate.
D1 takes more over the year
£1,000.00
| D0 | D1 | |
|---|---|---|
| Tax-free amount | none | none |
| Tax, first month | £666.40 | £749.70 |
| Tax over the year | £8,000.00 | £9,000.00 |
| Take-home after tax | £12,000 | £11,000 |
Same pay every month, HMRC’s cumulative method, Income Tax only (no National Insurance).
D1 tells an employer or pension provider to tax everything it pays you at the additional rate of 45%, with no tax-free amount. GOV.UK describes it as a code usually used when you have more than one job or pension. It applies when the income that carries your main code already goes beyond £125,140, the level above which the additional rate applies in England, Wales and Northern Ireland for 2026 to 2027. At that level the Personal Allowance has gone completely, because it falls by half of the adjusted net income above £100,000. Any further pound, from a board seat, a consultancy paid through payroll or a second pension, is then taxed at 45%. A second job paying £20,000 costs £9,000.00 a year under D1, against £8,000.00 under D0 and £4,000.00 under BR. The Welsh version is CD1, also at 45%. Scotland has no D1 at this rate: its flat codes run from SBR to SD3.
Tax on a second job with BR, D0 or D1
With BR, over the year
£4,000.00
| BR (20%) | £4,000.00 |
| D0 (40%) | £8,000.00 |
| D1 (45%) | £9,000.00 |
| With 0T | £4,000.00 |
Rules read on HMRC’s texts by Radif Partners · Editorial policy · Method
What D1 does to each payment
In HMRC's PAYE specification, the D codes count upwards from the basic rate: D0 is the next rate, D1 the one after. Outside Scotland the ladder for 2026 to 2027 has three steps, 20, 40, 45%, so D1 is the last code available; there is no D2 in England, Wales or Northern Ireland. The payroll rounds each payment down to the pound and charges 45% on it. A monthly fee of £1,800 therefore loses £810.00, and a quarterly payment of £5,000 on a cumulative D1 code loses £2,250.00 when it is paid.
| Second income, yearly | BR | D0 | D1 |
|---|---|---|---|
| £5,000 | £1,000.00 | £2,000.00 | £2,250.00 |
| £12,000 | £2,400.00 | £4,800.00 | £5,400.00 |
| £20,000 | £4,000.00 | £8,000.00 | £9,000.00 |
| £40,000 | £7,999.80 | £15,999.60 | £17,999.55 |
The step from D0 to D1 is only 5 percentage points, but it adds up on a sizeable second income: on £40,000 a year it means £1,999.95 more than D0 would take.
The income levels behind D1
Two thresholds meet at £125,140. The first is the end of the higher rate band: the basic and higher bands together cover £125,140 of taxable income. The second is the taper of the Personal Allowance, explained by HMRC's guide to adjusted net income: from £100,000 upwards, the allowance falls by half of each extra pound of income, so £12,570 has gone by £125,140. Above that figure there is no allowance and no band left to fill, which is why any second source can safely be taxed at the top rate without being overtaxed.
Between £100,000 and £125,140 the picture is different. Your main code shrinks month after month as the allowance tapers, and a second source in that zone is usually on D0 rather than D1. The page on codes above £100,000 follows that taper step by step.
A worked case shows how the two codes split the work. Take a salary of £150,000 and a workplace pension of £20,000 drawn at the same time. The salary has no allowance left, so it carries 0T and is taxed through the bands from the first pound. The pension sits wholly above £125,140 and carries D1: £749.70 comes off each monthly payment, £9,000.00 over the year, which is exactly the additional rate on that income.
Personal Allowance above £100,000
Personal Allowance left
£0
| Code if this is all from one job | 0T |
| Allowance lost | £12,570 |
| Extra tax from the lost allowance (40%) | £5,028 |
£1 of allowance goes for every £2 above £100,000; none is left at £125,140.
When D1 is not right
D1 depends on HMRC's estimate of your main pay. If a bonus that HMRC expected is not paid, or your pay is cut and your income falls under £125,140, part of the second income should fall at 40% and D1 overtaxes it. If your main role ends, the remaining source may need an allowance, or at least a lower rate. In each case, update the estimated income for every job and pension in your HMRC online account; HMRC changes the codes that need changing and tells the employer within 15 working days.
The reverse error also exists. A second job left on D0 or BR while your income is far above £125,140 takes too little each month. The shortfall is collected later through a reduced code or a bill, so correcting it early costs nothing extra.
CD1 in Wales and the Scottish codes
Welsh taxpayers see CD1, which applies the Welsh additional rate of 45%. Scottish taxpayers have a longer ladder of six rates, so the same idea uses different labels: SD2 charges the advanced rate of 45% and SD3 the top rate of 48%. A Scottish SD1 is the higher rate of 42%, not the additional rate. The Scottish codes page sets out when each one applies.