Martin Lewis has said that people should start checking their payslips and look out for a specific symbol.
The Money Saving Expert founder said that if you spot an 'X' on your payslip, then there is a chance you are on the wrong tax code.
The warning came as he appeared on his ITV Money Show Live after a woman asked him about her own situation and whether or not she could be due money.
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Viewer Tina, according to the Echo, said she had been overtaxed and wanted to know if she was entitled to a rebate, said: "I’m on a 16-hour contract, and last month, I did lots of overtime. I was put on the basic rate temporarily and overtaxed by more than £800."
She further explained: “My tax code is now back to 1257L, but I’m short £500, worrying about money. Will I get a tax rebate?”
In response, the financial guru addressed her question and said that it "depends whether she’s on a Month One tax code or not" as "Month One is often referred to as Emergency Code. If she is, she needs to sort that with HMRC, either by phoning them or by going into her personal tax account through the HMRC app."
Rebecca Benneyworth, a tax expert, advised Martin during the live show that if employees suspect they're on an emergency tax code, they should look out for an "X" on their payslip. She said: “On her tax code, she’ll have 1257L. If she’s got an ‘X’ on the end (1257LX), she’s on Month One.
“Otherwise, if it’s not got an ‘X’ on the end, it should come back in her next pay packet. If it doesn’t, speak to your employer.”
This normally happens if HMRC doesn't have enough details about how much tax you need to pay - you're most likely to be on emergency tax when you start a new job. You may also see 1257 W1 or 1257 M1 on your pay slips, if you're on emergency tax.
Martin said: "If you’ve got the wrong tax code, go to HMRC. If you’re not getting the tax back, go and talk politely to your employer. Many payroll departments are actually pretty helpful if you’re struggling with this."
"Each year, you’re sent your tax code if you’re an employee. The standard one is 1257L. What that actually means is £12,570 - which is how much you can earn tax free each year.
“Millions of people are on the wrong tax code. Some are overpaying and are therefore due thousands of pounds back. Some are underpaying and are therefore going to get a shock as they’re asked for more money.
"So it’s really important, because it's your legal responsibility - not HMRC, not your employer - to check your tax code."
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