The "M1" suffix looks harmless next to a normal-looking 1257L, but it quietly switches off the year-to-date maths that keeps your tax accurate. Here is exactly what it does.
If your payslip shows the tax code 1257L M1, the first part looks completely normal, it is the standard code millions of people are on, but those two extra characters change everything. The M1 suffix tells your employer to forget the past and tax you as though this month is the only month that has ever happened. For someone with an uneven pay history during the year, that quietly costs money until it is fixed.
A normal tax code does quiet, clever maths every payday. It looks at everything you have earned and every pound of tax you have paid since 6 April, works out how much allowance you have accumulated, and adjusts that period's deduction so the running total is always correct. This is called operating on a cumulative basis.
The M1 tax code turns that off. The "M1" stands for Month 1, and it instructs payroll to treat every single month as if it were the first month of the tax year. There is no look-back, no running total, and no self-correction.
This makes 1257L M1 a type of non-cumulative tax code. It is HMRC's safe default when your employer does not yet have the full picture of your year, most often because you started a new job without handing over a P45.
The damage from M1 shows up when your earnings in the year so far are uneven, which is exactly the situation when you have just changed jobs.
Take Marcus, who is unemployed for the first three months of 2025/26 (April to June) and then starts a job in July paying £3,500 a month. He is put on 1257L M1.
Under M1, payroll gives him just one month's allowance (£1,047.50) each month and taxes the rest, ignoring the three months of allowance he never used while out of work.
| Basis | Allowance applied to July pay | Tax on £3,500 |
|---|---|---|
| 1257L M1 (non-cumulative) | £1,047.50 (one month only) | ~£490.50 |
| 1257L cumulative | £4,190 (four months: Apr–Jul) | ~£0 |
On the correct cumulative code, Marcus has accumulated £4,190 of allowance by July (four months at £1,047.50), which more than covers his £3,500 pay, so he should owe almost nothing that month. On M1 he pays around £490 in tax he does not really owe. The shortfall comes back, but only once a cumulative code is restored, not before.
Note that M1 is not always worse: someone with high, steady pay every month may pay roughly the right amount under either basis. The problem is specifically the lost benefit of allowance built up during low-earning earlier months.
The fix is to give HMRC the information it is missing so it can issue a cumulative code:
Once a cumulative 1257L code arrives, payroll recalculates on a year-to-date basis and any tax you overpaid under M1 is refunded automatically through your next payslip. If the tax year happens to end first, HMRC issues a P800 calculation and refunds you directly.
The M1 on 1257L is small print with a price tag. It is not a penalty, just HMRC's cautious default, and a cumulative code undoes it.
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