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How you get taxed if you work more than one job
If you work for more than one employer, you must be enrolled to each employer's PAYE system. You must properly complete the new starting checklist since here is where you will offer paperwork to your employer that you have another job. They may then assess which tax code is most suited for you. Your tax code is critical in ensuring that you do not pay too much or too little tax directly from your paycheck.
You'll need to find a main employment. This is generally the employer from whom you earn the highest compensation. This is due to the fact that it will be more convenient for them to account for your personal allowance via your tax code. Every individual is entitled to an annual personal allowance, which means you may earn up to £12,570 tax-free in fiscal year 2022/23. If you do not inform your second employer that you are already working, they may use the usual tax code, indicating to HMRC that you should get your entire personal allowance. This results in you receiving twice the entire personal allowance amount and underpaying tax.
If you earn less than £12,570 for both employment, you may ask HMRC to divide your personal allowance between two employers. This means you'll still get your entire personal allowance and will pay the correct amount of tax based on how much you earn from both employment.
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