Millions of households paid too much in tax to HMRC last year, with many having no idea, according to the latest research on HMRC overpayments. Now Martin Lewis has urged households to ensure they regularly check their payslips to ensure they are not paying too much.
Tax Codes and Overpayments
These payslips show your tax codes and whether you are on the right one. This dictates how much tax you pay every month. Millions of people see more money taken from their pay than should be the case, but money expert Martin says it is your responsibility to check.
According to a freedom of information request submitted by accountancy firm UHY Hacker Young, 5.6 million people overpaid a combined £3.5 billion in income tax in the most recent tax year, with the average overpayment around £689. While HMRC will often pay the money back, it is not always automatically the case, meaning households have to chase it.
Martin Lewis's Warning
Martin said: "Millions of codes are wrong each year, so it's crucial to check yours — it's your responsibility, not your employer's, not HMRC's." And he previously warned on his BBC Sounds podcast: "Do not assume that because it's coming from HMRC that it is right. Millions — and that is not an exaggeration, it's a literal fact — millions are wrong every year."
The most common code for the 2026/27 tax year is 1257L, which reflects the standard £12,570 personal allowance. If yours looks different and you are unsure why, experts say it is worth checking. Errors are most likely after a life change like starting a new job, receiving multiple sources of income, or drawing a pension.
Expert Advice
Stefani Williams, partner at financial advisers Holden & Partners, said: "Tax codes can change after events such as a job move, starting to draw a pension, or receiving workplace benefits. It's something that's easy to overlook. The common theme is that these things don't usually correct themselves automatically. Taking a little time to review your position can make a difference."
