NT tax code: who gets no tax deducted and when

An NT tax code tells an employer or pension payer to deduct no Income Tax from that source of income. HMRC only issues it in a short list of special cases, such as people exempt under a double taxation agreement, some ministers of religion, the rest of the tax year after a bankruptcy order, and some people whose earnings are taxed through Self Assessment instead.

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What does the NT tax code mean?

NT means no tax. The gov.uk guide to tax code letters describes it simply as “You’re not paying any tax on this income”. HMRC’s PAYE Manual explains that the letter N stands for no tax, the T is a suffix, and the employer deducts no tax from the pay at that source.

The code only covers the job or pension it is issued for. You get a tax code for each employment or pension you have, so it is possible to have NT on one source and a normal code such as 1257L on another.

Who gets an NT tax code?

HMRC’s own instructions say its staff should use code NT only in cases clearly within a set list. The main cases in the PAYE Manual are:

Double taxation agreements. Visiting teachers, foreign language assistants, students and others who are exempt from UK tax on that income under a double taxation agreement.
Ministers of religion. Clergy and ministers in certain circumstances, including nuns or monks who have deeded their worldly goods to their order, where HMRC holds the deed.
Bankruptcy. Where an employee is subject to a bankruptcy order, HMRC uses NT from the date of bankruptcy to the following 5 April, whether the person stays with the same employer or starts a new job.
Certain professions. Where someone self assesses trading or other income outside PAYE and holds a PAYE post as a small part of their main work, or where earnings are self assessed as profits of a trade or profession, such as payments to entertainers and some directors’ fees.
Entertainment industry. Under the seven day rule an employer need not deduct tax for someone engaged for 6 days or less. For other workers, HMRC may have agreed NT.

HMRC’s guidance for employers gives musicians who are regarded as self employed and not subject to PAYE as an example of the very specific cases where NT is used.

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Does an NT code mean the income is tax free?

Not always. In the double taxation cases the income is exempt because of the agreement. In the professions and entertainment cases, the earnings are still taxable, but they are taxed as part of the person’s business profits through Self Assessment rather than through payroll. Anyone in that position will normally be filing a return already, because a sole trader who earned more than £1,000 must send one. See who needs to file a tax return.

NT is also not permanent. Where NT is given under a double taxation agreement, HMRC’s manual tells its staff to keep supporting notes, to write to check the position if none are held, and to remove NT if there is no reply or the reason for it has ended.

How does an employer operate an NT code?

Code NT can be issued on a cumulative basis or on a week 1/month 1 basis, and the PAYE system defaults to week 1/month 1. The employer instructions differ:

Week 1/month 1. Do not deduct tax after receiving the code, keep a record of the employee’s pay and do not make any refunds.
Cumulative. Refunds can be made, worked out using the totals of the employee’s pay and tax since 6 April.

So if tax was taken earlier in the year and NT then arrives on a cumulative basis, the payroll can repay it. On week 1/month 1 it cannot. Our guide to week 1/month 1 tax codes explains the difference in more detail.

Is there a Scottish or Welsh version of NT?

No. The S prefix for Scottish rates and the C prefix for Welsh rates do not apply to code NT, and HMRC says code NT is used for all UK residents regardless of where they live. Because no tax is deducted, there is no rate for a prefix to change. For how the prefixes work on other codes, see S and C tax codes.

How is NT different from 0T, BR and D codes?

These codes are easy to confuse because none of them gives a tax free allowance on that job. The difference is the rate applied.

Code	What the employer does	Typical use
NT	Deducts no tax	Listed special cases only
0T	Taxes all pay with no tax free allowance, using the normal bands	Personal Allowance used up, or a new job without the details needed
BR	Taxes all pay at the 20% basic rate	Second job or pension
D0	Taxes all pay at the 40% higher rate	Second job or pension
D1	Taxes all pay at the 45% additional rate	Second job or pension

For more on these, see the 0T tax code, the BR tax code and D0 and D1 tax codes.

What if I have an NT code and do not think I should?

An NT code only controls what payroll deducts. It does not, on its own, decide what you owe for the year. Gov.uk says that if you think the tax is wrong, your tax code may be incorrect, and HMRC is the body that tells your employer which code to use. Raise it with HMRC as soon as you notice. Our guide on how to correct a wrong tax code sets out the steps.

Illustration only. Ana is a self employed musician. She also holds a small paid post with an orchestra that is run through payroll, but the fees are part of her musical profession and she reports them on her Self Assessment return as trading income. HMRC agrees code NT for the orchestra post, so the orchestra deducts no tax and keeps a record of what it pays her. Ana’s tax on those fees is worked out on her return with the rest of her profits. If she later stopped self assessing that work, she would ask HMRC to review the code.

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Frequently asked questions

Can I ask my employer to use NT?

No. Your employer or pension provider uses the code HMRC tells them to use. NT is only issued where your case falls within HMRC’s list, and HMRC records the reason before issuing it.

How long does an NT code last?

It depends on the reason. After a bankruptcy order HMRC uses NT until the following 5 April. Under a double taxation agreement it stays only while the reason continues and HMRC can remove it if it does not get a reply to its checks.

Does NT apply to my other jobs or pension?

No. You have a separate tax code for each employment or pension, so NT on one source does not change the code on another.

Will I get a refund if tax was taken before NT arrived?

On a cumulative NT code the employer can refund tax taken since 6 April. On a week 1/month 1 NT code, which is the default, the employer must not make refunds.

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Sources

Reviewed by Christine Anderson, Broker, Solar Protect. Last reviewed 8 November 2026. Part of Accountapedia, the Solar Protect guide to UK tax and accounting. This page is general information, not personalised advice.