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PAYE Explained for Visa Holders: UK Tax Guide

A beginner-friendly guide to the UK tax system for visa holders, covering PAYE, payslips, tax codes, National Insurance, and your obligations.

Checked 28 March 202610 min readWritten by the Rowan Editorial Team
Section
Practical Life in the UK
Reading time
10 min
Last checked
28 March 2026
Source
The published Immigration Rules and GOV.UK guidance, linked throughout this guide.
Rowan does not
Look at your own case, tell you which route to choose, or say what the Home Office will decide. This guide shows the published rules and where to read them.

In short

  • PAYE deducts Income Tax and National Insurance from your pay before you receive it.
  • You pay the same tax rates as British citizens; immigration permission makes no difference.
  • For 2026 to 2027 the personal allowance is £12,570 and the most common tax code is 1257L.
  • Employee National Insurance is 8% on earnings from £242 to £967 a week and 2% above that.
  • You generally do not need to file a tax return if PAYE is your only income.

If you are working in the UK on a visa, you pay tax through the PAYE system. This guide explains how PAYE works, how to read your payslip, what your tax code means, and how National Insurance contributions work. Understanding these basics helps you ensure you are paying the right amount and keeping your finances in order.

How PAYE Works

When you work for a UK employer, they deduct income tax and National Insurance contributions from your gross pay before transferring your net pay to your bank account. This is the PAYE system. Your employer sends the deducted amounts to HMRC (His Majesty's Revenue and Customs) on your behalf.

You do not need to do anything extra — the system is automatic. However, it is your responsibility to check that your tax code is correct and that the right amounts are being deducted. If you are on a spouse visa or student visa, the same PAYE rules apply to any permitted employment.

Understanding Your Payslip

Your employer must provide an itemised payslip each time you are paid. A typical payslip shows:

  • Gross pay. Your total earnings before deductions.
  • Income tax. The amount deducted for tax.
  • National Insurance. Your NI contributions.
  • Student loan deduction. If applicable.
  • Pension contribution. Under automatic enrolment, your employer must put you into a workplace pension scheme. The minimum total contribution is 8% of qualifying earnings, of which the employer pays at least 3% and you pay the rest, usually 5%. Qualifying earnings are the band from £6,240 to £50,270 a year.
  • Net pay. What you actually receive in your bank account.
  • Tax code. Usually shown at the top of your payslip.

Income Tax Rates

For the 2026 to 2027 tax year:

  • Personal allowance: £12,570 (no tax on this amount)
  • Basic rate (20%): £12,571 to £50,270
  • Higher rate (40%): £50,271 to £125,140
  • Additional rate (45%): Over £125,140

Scotland has different income tax bands. If you live in Scotland, check the Scottish rates.

National Insurance

National Insurance contributions (NICs) fund the State Pension, NHS, and other benefits. As an employee, you pay Class 1 NICs:

  • 8% on earnings from £242 to £967 a week (£1,048 to £4,189 a month)
  • 2% on earnings above £967 a week (£4,189 a month)

Your employer pays a separate employer contribution, currently 15% on earnings above the secondary threshold. That is the employer's cost, not a deduction from your pay.

Your contributions build up entitlement to the new State Pension. You need at least 10 qualifying years for any new State Pension and 35 qualifying years for the full amount, which is £241.30 a week. Apply for your National Insurance number if you do not already have one.

Tax Codes

Your tax code determines how much personal allowance your employer applies. The most common code is 1257L. If you see a different code on your payslip, you can check it with HM Revenue and Customs:

  • 1257L: Standard code. Personal allowance of £12,570.
  • BR: All income taxed at basic rate (20%). This often happens with a second job.
  • 0T: No personal allowance applied. It means either that your personal allowance has been used up, or that you have started a new job and your employer does not yet have the details needed to give you a tax code.
  • D0: All income from this job or pension taxed at the higher rate.
  • W1 or M1: An emergency code applied on a weekly or monthly basis. It is corrected once HM Revenue and Customs has your details.

Immigration-Specific Considerations

  • Your salary shown on PAYE records must match what was stated on your Certificate of Sponsorship (for Skilled Worker visa holders). For applications from 26 March 2026 the rules also require the salary to be paid in each pay period, not averaged across the year.
  • HMRC records may be checked by the Home Office when you apply for ILR or citizenship.
  • If you work multiple jobs, ensure all income is properly declared through PAYE.
  • Keep all payslips — they are essential evidence for visa extensions and ILR applications.
  • Understand the immigration health surcharge deductions that are separate from PAYE.
  • Be aware of the full visa fees when budgeting for extensions.

Next Steps

Your payslip shows your tax code. HM Revenue and Customs takes Income Tax and PAYE enquiries on 0300 200 3300, Monday to Friday 8am to 6pm, closed on bank holidays, or on +44 135 535 9022 from outside the UK. For general immigration queries, see our Home Office contact guide. If you also have self-assessment obligations, file your return on time to avoid penalties. For more information, visit the GOV.UK income tax page and the GOV.UK National Insurance page.

Questions and answers

What is PAYE?

PAYE (Pay As You Earn) is the UK system for collecting Income Tax and National Insurance contributions from employees. Your employer deducts them from your pay before the money reaches you and sends them to HM Revenue and Customs. You do not usually need to file a tax return if PAYE is your only source of income and your tax code is correct.

Do visa holders pay the same tax as British citizens?

Yes. If you are working legally in the UK, you pay Income Tax and National Insurance on the same basis as British citizens. Your immigration permission does not change the tax rates, the thresholds, or the personal allowance.

What is a tax code and why does it matter?

Your tax code tells your employer how much tax to deduct from your pay. The most common code is 1257L, which applies the standard personal allowance of £12,570 for the 2026 to 2027 tax year. Other codes apply where HM Revenue and Customs does not have full details, and they can lead to too much or too little tax being taken.

Do I need a National Insurance number to work?

GOV.UK says you can start work before you get a National Insurance number as long as you can prove you have the right to work in the UK. There is no temporary number to use in the meantime. You may already have one: if you have an eVisa, check your UK Visas and Immigration account, and if you held a biometric residence permit it was printed on the back of the card. Otherwise it takes up to 4 weeks to get one after applying. See our National Insurance number guide for how to apply.

This guide is general information about published immigration rules. It is not advice about an individual application under s.82 Immigration and Asylum Act 1999, and Rowan is not regulated by the Immigration Advice Authority. Immigration rules change several times a year. For advice on a particular situation, contact an adviser authorised by the Immigration Advice Authority or an immigration solicitor. Always check GOV.UK for the authoritative current rules.

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