What is Tax Code D0?
Tax code D0 means all income from this source is taxed at the 40% higher rate with no Personal Allowance.
Based on published HMRC 2026/27 tax thresholds
Last updated: 26 July 2026
Tax Code D0 Explained
Tax code D0 means that all income from the employment or pension using this code is taxed at the 40% higher rate, with no Personal Allowance applied. The “D” prefix indicates a fixed deduction rate, and “0” indicates the higher rate band (40%).
This code is typically applied to a second income source for taxpayers whose primary income already places them in the higher rate band (above £50,270 in 2026/27). Because their main employer handles tax up to and beyond the basic rate threshold, HMRC instructs the second employer to deduct everything at 40%.
D0 can also appear where HMRC is collecting a significant tax debt from a previous year, or where an individual has complex income arrangements that push their marginal rate to 40% from the first pound of the secondary income.
If you believe D0 has been applied incorrectly — for example, if your combined income does not exceed £50,270 — contact HMRC to have your code corrected.
Comparison: Tax Code D0 vs Standard 1257L
| Feature | Code D0 | Standard 1257L |
|---|---|---|
| Tax-free Personal Allowance | None (£0) | £12,570 |
| Tax rate applied | 40% flat (higher rate) | 20% / 40% / 45% by band |
| Typical use | Second income, higher-rate taxpayer | Primary employment |
| Monthly tax on £3,000 gross | £1,200 | ~£430 |
| NI deductions still apply? | Yes, standard rates | Yes, standard rates |
⚠️ When Does Tax Code D0 Apply?
- You have a second job and your combined income from both jobs exceeds £50,270 (the higher rate threshold)
- Your primary income already places you firmly in the higher rate band
- HMRC is collecting a large tax debt and has instructed your employer to deduct at 40%
- You receive income from a pension or investment alongside your main salary
Tax Code D0 — FAQs
D0 is usually applied to a second source of income when HMRC believes your total earnings place you in the higher rate tax band (above £50,270). It ensures all income from that source is taxed at 40% from the start.
No. BR deducts tax at 20% (basic rate) with no allowance, while D0 deducts at 40% (higher rate) with no allowance. D0 applies when HMRC expects your marginal rate to be 40% across all your income sources.
D1 applies the 45% additional rate to all income, while D0 applies the 40% higher rate. D1 is used for taxpayers whose combined income exceeds £125,140 in 2026/27.
Contact HMRC on 0300 200 3300 or through your Personal Tax Account. Provide details of all your income sources so HMRC can assess the correct code. Changes usually take effect in the next pay period after your employer receives the updated code.
Yes — if D0 was applied incorrectly and you overpaid tax during the year, HMRC will usually reconcile this after the tax year ends and issue a refund. You can also check and claim early via your Personal Tax Account.
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