Understanding your tax code and how it's calculated can help you save money by making sure sure you're paying the right amount of tax.
It can also help you claim tax relief and receive money if you're due a tax rebate because of errors in your tax code, a problem that affected (This link will open in a new window)6.7m people in 2016-17.
Everyone has a personal income tax allowance - the amount they can earn over 12 months before income tax is due. For 2017/18, it's £11,500 and from April 6, 2018, it's £11,850.
HMRC collect income tax by issuing a (This link will open in a new window)tax code that deducts the last digit of an employee's tax allowance to create a number part, e.g. 1185. A letter is added, usually 'L', which means you're entitled to the standard personal allowance, so, 1185L for 2018-19.
If your tax code ends in 'M', it means you receive the marriage allowance from your partner. This lets them transfer £1,190 of their personal allowance to you, if you're earning more than them. 'N' means you've given the (This link will open in a new window)marriage allowance to your partner.