Every UK worker sent letter from Friday with code to check if you're owed cash

Every worker in the UK is being sent a letter by their employer this Friday - and it's vital that you check it as soon as possible.

Across the UK, every employee of a company still in full time employment on Friday, April 5 must be sent a document known as a P60. It's mandatory that your employer sends this to you, and it must be done by May 31.

Your employer can either send it in the post or by email but it must be done before the end of May, and it covers the period April 6 2023 to April 5 2024.

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The P60 document will tell you how much money you were paid in salary across the full year, how much was deducted in tax, how much was taken for student loan repayments (if this applies to you) and how much you were paid for various benefits paid via your employer such as Statutory Maternity Pay, Statutory Parental Bereavement Pay or Statutory Adoption Pay.

The P60 will have a 'final tax code' on it - and it's this you need to check.

For most people, your tax code will be 1257L - this is the standard tax code for most basic rate taxpayers earning between £12,570 and £50,270.

But there are several others to watch out for.

If your tax code has ‘W1’ or ‘M1’ or ‘X’ at the end - these are emergency tax codes. For example, 1257LWI, 1257LMI or 1257LX all complicate things usually due to changing jobs or HMRC not being given the correct details. If your change in circumstances means you have not paid the right amount of tax, you’ll stay on the emergency tax code until you’ve paid the correct tax for the year and you could be owed money - or you could owe HMRC money.

BR means all your income is taxes at the basic rate - usually this is for a second job. But D0 means all of the income is taxed at higher rate. D1 means all your income is at the additional rate (the topmost), and NT means you aren't paying any tax on the income at all.

According to research by Canada Life, the average overpayment of tax is £689 in the UK, so if you did overpay, you could be owed as much as that back, or more.

The HMRC adds: "Your P60 shows the tax you’ve paid on your salary in the tax year (6 April to 5 April). You get a separate P60 for each of your jobs every tax year.

"If you’re working for an employer on 5 April they must give you a P60. They must provide this by 31 May, on paper or electronically. You’ll need your P60 to prove how much tax you’ve paid on your salary, for example, to claim back overpaid tax, to apply for tax credits, or aas proof of your income if you apply for a loan or a mortgage.

"You can check how much tax you paid last year if you think you might have paid too much."