What is an HMRC P2 Notice of Coding?
A P2 Notice of Coding is a personalised communication from HMRC explaining how your PAYE tax code has been calculated.
HMRC's PAYE manual describes the P2 as a notice that tells you what makes up your code and provides an explanation of the coding items included in the calculation. [oai_citation:1‡GOV.UK](https://www.gov.uk/hmrc-internal-manuals/paye-manual/paye11030?utm_source=chatgpt.com)
Think of the P2 as the explanation behind your tax code. Your payslip may show the final code, such as 1257L or BR, while the P2 explains why HMRC has arrived at that code.
Why might HMRC send you a tax-code notice?
A coding notice can be generated when HMRC calculates or changes a PAYE tax code and needs to explain how the code has been built. The notice is intended to help you check whether the information used by HMRC reflects your circumstances. [oai_citation:2‡GOV.UK](https://www.gov.uk/hmrc-internal-manuals/paye-manual/paye11030?utm_source=chatgpt.com)
Changes to your PAYE information can include employment, pensions, estimated taxable income, taxable company benefits, expenses or other items affecting your available tax-free amount. HMRC advises taxpayers to check and update these details where a code appears incorrect. [oai_citation:3‡GOV.UK](https://www.gov.uk/tax-codes/how-to-update-your-tax-code?utm_source=chatgpt.com)
What information does a P2 coding notice show?
HMRC says a P2 is personalised to the taxpayer and can include your employments or pensions, National Insurance number and an arithmetic breakdown showing how the code is calculated. [oai_citation:4‡GOV.UK](https://www.gov.uk/hmrc-internal-manuals/paye-manual/paye11030?utm_source=chatgpt.com)
Your PAYE sources
The notice can identify live employments and pensions that HMRC is taking into account.
Your tax code
It confirms the tax code HMRC has calculated for the relevant job or pension.
Personal Allowance
The calculation can show the tax-free allowance being used when building the code.
Coding adjustments
Items that increase or reduce your tax-free amount can appear within the calculation.
Tax-free amount
The notice can show a positive or negative tax-free amount, including additional information for K codes.
Explanatory notes
HMRC adds descriptions explaining the allowances and deductions included in your code.
What allowances and deductions can appear on a coding notice?
The exact items depend on your individual circumstances. HMRC's P2 coding notes include a wide range of possible allowances and deductions. [oai_citation:5‡GOV.UK](https://www.gov.uk/hmrc-internal-manuals/paye-manual/paye11040?utm_source=chatgpt.com)
Examples can include:
- Your Personal Allowance.
- Eligible employment expenses.
- Taxable company-car or van benefits.
- Other taxable benefits provided by an employer.
- State Pension or other taxable income.
- Adjustments associated with more than one job or pension.
- Tax that HMRC is attempting to collect through PAYE.
The final code is only as accurate as the information behind it
If an old employment, incorrect income estimate or outdated company benefit remains on your HMRC record, it can affect the calculation used to produce your tax code.
HMRC therefore tells taxpayers who think their code is wrong to check their employment, pension, taxable-income, company-benefit and expense details. [oai_citation:6‡GOV.UK](https://www.gov.uk/tax-codes/how-to-update-your-tax-code?utm_source=chatgpt.com)
Does one P2 cover more than one job or pension?
It can. HMRC's current PAYE manual says the P2 coding notice includes all live employments and/or pensions on a single form. [oai_citation:7‡GOV.UK](https://www.gov.uk/hmrc-internal-manuals/paye-manual/paye11030?utm_source=chatgpt.com)
That is important because different PAYE sources can have different tax codes.
For example, one employment might use your Personal Allowance while a second job could use BR or another code depending on your overall circumstances.
If you have recently started a new job, HMRC says employment details can normally become visible in its online services within six weeks of your first payday. [oai_citation:8‡GOV.UK](https://www.gov.uk/guidance/tell-hmrc-if-you-have-a-new-job-or-more-than-one-job?utm_source=chatgpt.com)
Why has your tax code changed?
A change usually means that HMRC has received or applied information that changes the PAYE calculation.
Common areas to check include:
- A new job.
- A job HMRC still shows as active after you left.
- A change to estimated employment income.
- A pension starting or stopping.
- A company benefit starting or ending.
- Employment expenses or tax relief.
- Other taxable income.
Not every update you give HMRC will necessarily result in a new code. Where a code does need changing, HMRC says it will update the code and tell both you and the employer or pension provider. [oai_citation:9‡GOV.UK](https://www.gov.uk/tax-codes/how-to-update-your-tax-code?utm_source=chatgpt.com)
Is your P2 the same notice your employer receives?
The P2 is the personalised coding explanation for the taxpayer. The employer receives the tax-code information needed to operate payroll.
For 2026/27, HMRC says an employer receiving a new tax code may receive either a paper P9(T), called a Notice to employer of employee's tax code, or an online coding notification through PAYE Online. [oai_citation:10‡GOV.UK](https://www.gov.uk/government/publications/p9x-tax-codes/p9x-tax-codes-to-use-from-6-april-2026?utm_source=chatgpt.com)
| Notice | Who receives it? | Main purpose |
|---|---|---|
| P2 | Employee or pension recipient. | Explains how HMRC has calculated the person's PAYE tax code. |
| P9(T) | Employer. | Tells the employer which new tax code should be operated through payroll. |
| Online coding notice | Employer using PAYE Online. | Provides updated tax-code instructions electronically. |
What is the difference between a P2, P45 and P60?
| Document | When you see it | Main purpose |
|---|---|---|
| P2 | When HMRC provides a PAYE coding explanation. | Shows how your tax code has been calculated. |
| P45 | When you leave an employment. | Records leaving information and relevant PAYE pay and tax details. |
| P60 | After the end of a tax year if you remain employed on 5 April. | Summarises relevant PAYE pay and tax information for the completed year. |
Read our P45 Explained and P60 Explained guides for those documents.
What should you do if your tax-code notice looks wrong?
HMRC says an incorrect tax code is usually caused by incorrect or missing information. The quickest route is normally to check and update the details held in HMRC's online Income Tax service. [oai_citation:11‡GOV.UK](https://www.gov.uk/tax-codes/how-to-update-your-tax-code?utm_source=chatgpt.com)
Check every job and pension
Make sure HMRC has the correct active employments and pensions and that old sources are not incorrectly shown as continuing.
Check HMRC's income estimates
Compare estimated employment or pension income with what you realistically expect to receive during the tax year.
Review benefits and expenses
Check taxable company benefits and any employment expenses or tax relief included in the calculation.
Update incorrect information
Use HMRC's online service where appropriate, or contact HMRC if you cannot use the service.
HMRC currently says that if a tax code needs changing, it will tell you and your employer the new code within 15 working days. For monthly pay, the new code should generally appear on the next or following payslip; for weekly pay, HMRC says it should generally appear by the third payslip. [oai_citation:12‡GOV.UK](https://www.gov.uk/tax-codes/how-to-update-your-tax-code?utm_source=chatgpt.com)
Can a tax-code notice reveal overpaid or underpaid tax?
A coding notice can help you spot information that may cause the wrong amount of tax to be deducted, but the notice itself does not prove that a refund is due.
If the underlying code has caused excessive PAYE deductions, correcting HMRC's information can result in the tax position being adjusted. HMRC states that if you have paid the wrong amount, you may receive a refund or need to pay tax owed. [oai_citation:13‡GOV.UK](https://www.gov.uk/tax-codes/how-to-update-your-tax-code?utm_source=chatgpt.com)
A code such as BR, 1257L or a K code may be correct in one person's circumstances and wrong in another's. The P2 is useful because it shows the information behind the calculation.
For more detail, see our Overpaid Tax Guide .
Reviewed & Updated
17 August 2026
2026/27
GO TAX REFUNDS
HM Revenue & Customs / GOV.UK
PAYE codes and coding notices depend on individual circumstances and may change during the tax year. Always check your notice against your current employment, pension, benefit and income information.
PAYE Tax Code Notice FAQs
What is a P2 tax-code notice?
A P2 is HMRC's personalised Notice of Coding. It explains what makes up your PAYE tax code and the allowances, deductions or other coding items included in it.
Why have I received a new tax-code notice?
HMRC may have recalculated your code because information about your employment, pension, estimated income, benefits, allowances or other PAYE circumstances changed.
Does my employer receive my P2?
The P2 is the taxpayer-facing explanation. Employers receive the coding instructions they need for payroll, such as a P9(T) or an online coding notification.
Can a P2 show more than one job?
Yes. HMRC says the P2 can include all live employments and pensions on the same notice.
What should I do if an old job is still on my HMRC record?
Check your PAYE information in HMRC's online service and update the employment details where the service allows. An old employment incorrectly remaining active can affect how HMRC calculates your PAYE position.
Can a wrong coding notice cause me to overpay tax?
If incorrect underlying information results in the wrong tax code being operated, too much or too little tax can potentially be deducted. Your overall PAYE position must be checked to establish the actual difference.
How quickly will a corrected code reach my employer?
HMRC currently says that where your tax code needs to change, it will tell you and your employer the new code within 15 working days.
HMRC & GOV.UK Sources
This guide is reviewed against current HMRC material on P2 coding notices, PAYE code changes and employer coding notifications.
Received a tax-code notice that does not look right?
Go Tax Refunds can help review your PAYE tax codes, employments, P45s, P60s and Income Tax deductions to identify whether the information behind your code appears consistent and whether you may have paid too much tax.
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