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An employee’s tax code allows an employer to deduct the correct amount of PAYE due, without knowing the employee’s personal circumstances. The standard personal tax allowance for the 2022/23 tax year is £12,570: this is converted to a standard tax code 1,257L by removing the last digit and replacing this with a suffix letter (usually L, M or T, though the suffix does not itself affect the PAYE deductions). The standard tax code of 1,257L therefore allows the employee to receive 1/12 of the annual tax free pay due, each month (1/52 if paid weekly). When an employee begins new employment without handing in form P45 from their old job, the employer may be required to operate 1,257L on a ‘week 1/month 1’ basis (also known as the ‘emergency tax code'). A week1/month 1 code means the tax calculation is performed one week or month at a time rather than based on cumulative earnings for the year to date.