“Auto-coding” was introduced for Self Assessment tax returns for 2010-11 and uses the information of other income and deductions from the submitted tax return to calculate and issue a revised tax code automatically for the current tax year.

The process is intended update the tax codes sooner ensuring that you pay the right amount of PAYE tax throughout the tax year.

The types of income, allowances and reliefs which can be included in your PAYE tax code are listed on the HMRC website.

It is possible to request that HMRC do not attempt to collect tax due on other income sources through the PAYE code when submitting the self assessment tax return.

In some cases, more than one PAYE code will be issued throughout the year, which can happen when the code is reviewed manually by HMRC.  Commonly individuals who receive benefits in kind, or who have underpaid tax in previous years may have manual adjustments made to their PAYE tax code.

Your accountant will not automatically receive a copy of your PAYE coding notice when issued, and so if you have received a new PAYE code and are unsure whether the entries are correct or would like to make a change to entries, please contact us for guidance.