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The NHS Payslip Decoder
Your first NHS payslip will probably look wrong. It usually isn’t broken — it’s just speaking a language nobody taught you. Tap each line of the payslip below to decode it, then read why month one is nearly always over-taxed (and how the money comes back).
Tap each line
Anatomy of an NHS payslip
This is a typical layout — trusts and practices format theirs differently, but the same pieces are always there.
What it is: the code that tells payroll how much of your income is tax-free. 1257L is the standard code — it means the usual personal allowance of £12,570 a year before income tax starts.
Watch for: codes ending W1, M1 or X (an “emergency” code — see below), BR (everything taxed at 20% — common if HMRC thinks this is your second job), or 0T (no allowance at all — common for brand-new arrivals). Wrong code = wrong tax, and it’s fixable.
What it is: everything you earned before any deductions — basic pay plus any additional hours, enhancements for nights and weekends, and London weighting if it applies.
Watch for: your first payment sometimes covers a part-month, so it can be smaller than expected before any tax weirdness is involved at all.
What it is: income tax, collected by your employer through PAYE (“pay as you earn”) before the money reaches you. It’s calculated cumulatively across the tax year (which runs 6 April to 5 April), which is exactly why early payslips self-correct later.
Watch for: a first payslip taxed much more heavily than you expected — almost always the emergency code at work, not a mistake by your employer.
What it is: the payroll contribution that funds state benefits and the state pension. For employees it’s currently 8% on the main band of earnings and 2% above the upper limit. This is also why you need your NI number for payroll.
Watch for: the “NI letter” on your slip (usually A). Unlike income tax, NI is calculated per pay period, so it doesn’t “catch up” the way tax does.
What it is: you’re enrolled into the NHS Pension Scheme automatically — one of the most valuable parts of the whole package. You contribute between 5.2% and 12.5% of pensionable pay depending on your earnings tier, your employer adds far more, and contributions get tax relief.
Watch for: the deduction surprises many new starters — but think hard (and get advice) before opting out. It’s a genuinely good scheme.
What it is: a line most IMGs can ignore — it applies to UK student loans. If a deduction appears here and you never studied in the UK, payroll has your details wrong: tell them promptly.
What it is: what actually lands in your bank. In month one it’s often lower than it should be (emergency tax); by month two or three, with the right code, both the monthly amount and a refund of the overpayment usually arrive by themselves.
Keep every payslip — and your P60 (the annual summary you get at the end of each tax year). You’ll want them for visas, mortgages and references.
Figures are illustrative, not a pay quote: £3,200 gross in month 1 of the 2026/27 tax year on code 1257L, with pension at the 9.8% tier (£38,400 a year). The point is the shape, not the numbers.
The big one
Why is my first payslip wrong?
Most often: emergency tax. Until HMRC has your details, payroll uses an emergency code — 1257L W1, M1 or X — which taxes each month in isolation and ignores the allowance you’ve built up. New arrivals sometimes start on 0T or BR, which is harsher still. The result: month one takes a bigger tax bite than it should.
The reassuring part: because PAYE is cumulative, once the right code arrives the system automatically refunds what you overpaid — usually inside a payslip or two. You can speed it up:
Three steps to fix your tax code
1 · Set up your HMRC personal tax account as soon as you have your NI number — you can see and challenge your code there.
2 · Give payroll everything early: NI number, and your P45 if you’ve worked in the UK before (most IMGs won’t have one — that’s fine; payroll will use a starter checklist instead).
3 · If the code is still wrong after a month, ring HMRC or update it through the personal tax account. Refunds of overpaid tax come through your payslip automatically.
When is payday, and why does month one feel long?
Most NHS employers pay monthly, towards the end of the month — so if you start early in the month, your first pay can be five or six weeks away. Ask your employer about relocation support or an early-pay advance; some offer one. (This is why the First 90 Days checklist tells you to bridge the gap.)
Words you’ll meet on pay documents
P45 — the form you get when leaving a UK job; P60 — your annual pay-and-tax summary at the end of each tax year (keep it); PAYE — tax collected through payroll; tax year — 6 April to 5 April; TOIL — time off in lieu; increment — a pay step-up as you progress. More in the NHS Jargon Decoder.
Don’t judge your salary by month one. Judge it by month three, when the code has settled, the refund has landed and the pension has found its tier. If it still looks wrong then, that’s when to dig — payslip in one hand, personal tax account in the other.
General orientation, not professional advice. This page is educational material for doctors new to the NHS. It is not a substitute for current official guidance or for clinical judgement, and must not be relied on for the care of any individual or for financial, tax, visa or employment decisions. Always check up-to-date official sources and verify independently before acting on anything here.
Take this further
This tool is free. If you are preparing for PLAB 1, the full course puts the same reasoning into exam-style questions: a question bank with Core Lens and Deep Dive explanations, a Core Calendar revision plan built around your exam date, and Core Compass to show you which topics need you next.
Preparing for the UKMLA AKT instead?
Written by practising UK GPs as general orientation for doctors new to the NHS. Sources are linked on this page. Not financial or tax advice. Core Revision is an independent resource.