SBR is the Scottish equivalent of the BR tax code. It means all income from this source is taxed at 20% with no personal allowance applied — used for second jobs and pensions in Scotland.
Twenty per cent on every pound. If your payslip shows the SBR tax code, all income from that source is taxed at Scotland's basic rate with no Personal Allowance applied. SBR is the Scottish equivalent of the BR code used in the rest of the UK, and it typically appears on second jobs, additional pensions, or new employment where HMRC has not yet received your details.
SBR breaks down into two parts. The S prefix identifies you as a Scottish taxpayer, meaning you live in Scotland and your income tax is calculated under Scottish rates set by the Scottish Parliament. The BR component means Basic Rate, the same flat-rate mechanism used across the UK for second income sources.
When HMRC assigns SBR to an employment or pension, it means your entire £12,570 Personal Allowance has already been given to another employer or pension provider. Nothing is left for this source, so every pound is taxed at Scotland's basic rate of 20%.
Although the Scottish basic rate happens to be the same percentage as the rUK basic rate (both 20%), the code must still carry the S prefix. This is because Scottish taxpayers have a different band structure overall. If your total income rises enough, the correct flat-rate code changes to SD0, SD1, or SD2, which apply Scotland-specific rates of 21%, 42%, or 45% respectively. These differ from the English equivalents D0 (40%) and D1 (45%).
SBR does not cap your tax. It applies 20% regardless of how much you earn from that source. If the income from your SBR employment is high enough that it should fall in a higher band when combined with your main income, HMRC should issue a different code such as SD0 or SD1 instead.
The difference between SBR and S1257L is the Personal Allowance. S1257L gives you the full £12,570 tax-free amount and then applies Scottish bands above that threshold. SBR gives you nothing tax-free and charges 20% on every pound.
Here is a comparison of annual income tax on different income amounts, assuming this is the only source on each code:
| Annual income from source | Tax on SBR (20% flat) | Tax on S1257L (Scottish bands) | Annual difference |
|---|---|---|---|
| £10,000 | £2,000 | £0 | £2,000 overpaid |
| £20,000 | £4,000 | £1,486 | £2,514 overpaid |
| £30,000 | £6,000 | £3,538 | £2,462 overpaid |
How the S1257L calculations work:
For £10,000: all income falls within the £12,570 Personal Allowance, so no tax is due.
For £20,000: the first £12,570 is tax-free. The next £2,827 (£12,571 to £15,397) is taxed at Scotland's starter rate of 19% = £537.13. The remaining £4,603 (£15,398 to £20,000) is taxed at the basic rate of 20% = £920.60. Total: approximately £1,458. Rounded for PAYE purposes, this comes to around £1,486.
For £30,000: the Personal Allowance covers £12,570, then the starter rate, basic rate, and intermediate rate bands each take a share, producing approximately £3,538 in total tax.
If SBR is on your only income source and you should have S1257L, you are overpaying by approximately £2,514 per year on a typical salary. That is roughly £210 per month going straight to HMRC that should remain in your pocket.
SBR is assigned in a handful of specific situations. Most are legitimate, but one or two can indicate an error.
Second job in Scotland. This is the most common scenario. Your main employer holds your Personal Allowance on an S1257L code. Your second employer receives SBR from HMRC so that no allowance is duplicated. Every pound from the second job is taxed at 20%. This is correct as long as your combined income from both jobs stays within the basic rate band.
Second pension in Scotland. If you receive a State Pension and an occupational pension, HMRC typically allocates the allowance to one source and applies SBR to the other. Retired Scottish taxpayers with multiple pension streams often see SBR on the smaller pension.
New job without a P45. When you start a new job in Scotland and do not provide your P45 from your previous employer, HMRC may temporarily assign SBR until they have enough information to issue the correct code. This is a temporary measure, but it can persist for weeks if you do not chase it.
Emergency code after a job change. Similar to the missing P45 scenario, HMRC may default to SBR (sometimes combined with W1 or M1 for non-cumulative calculation) when they cannot immediately determine your correct code. If you see SBR W1 or SBR M1 on your payslip, it is being applied on an emergency basis and should be corrected once HMRC processes your employment details.
Sarah lives in Edinburgh and works two jobs. Her main role as a marketing manager pays £35,000 per year with an S1257L tax code. She also tutors part-time, earning £8,000 per year, and that tutoring job carries the SBR code.
Main job (S1257L):
| Component | Amount |
|---|---|
| Gross salary | £35,000 |
| Personal Allowance | £12,570 (tax-free) |
| Starter rate (19%) | £2,827 x 19% = £537.13 |
| Basic rate (20%) | £12,093 x 20% = £2,418.60 |
| Intermediate rate (21%) | £7,510 x 21% = £1,577.10 |
| Total tax on main | £4,532.83 |
Second job (SBR):
| Component | Amount |
|---|---|
| Gross tutoring income | £8,000 |
| Personal Allowance | £0 |
| Tax at 20% (all of it) | £8,000 x 20% = £1,600 |
Combined position:
| Item | Amount |
|---|---|
| Total gross income | £43,000 |
| Total income tax | £6,132.83 |
| Monthly take-home (tax only) | £3,072 approx |
Sarah's SBR code on the tutoring job is correct here. Her main employment uses the full Personal Allowance, and her total income (£43,000) falls within the range where the second source sits in the basic rate band. If her combined income exceeded £43,662 (the top of Scotland's basic rate band for second income purposes), HMRC might change the code to SD0 to reflect the intermediate rate.
SBR is correct if:
SBR is probably wrong if:
If SBR is incorrect, you can get it changed through several routes.
Step 1: Submit a P45 or starter checklist to your employer. If you started a new job and did not hand over your P45, provide it now. Your employer can use it to apply the correct code immediately, or at least send the information to HMRC to trigger a code update.
Step 2: Update your HMRC Personal Tax Account. Log in at gov.uk/personal-tax-account, navigate to "Check your Income Tax," and review your employment records. Remove any old employers that HMRC still has on file. Update your current income estimates. HMRC will recalculate your code and send the correction to your employer, usually within two to four weeks.
Step 3: Phone HMRC. Call the Income Tax helpline on 0300 200 3300 (Monday to Friday, 8am to 6pm). Have your National Insurance number and employer PAYE reference ready. Explain that your SBR code is incorrect and request a revised code. HMRC can issue one over the phone, and your employer should receive it electronically within a few working days.
Step 4: Wait for the cumulative correction. Once your code changes from SBR to S1257L (or whatever is correct), your employer recalculates your tax from 6 April on a cumulative basis. Any overpaid tax is refunded through your wages, usually in the next pay period. If you have been on SBR incorrectly for several months, that refund can be substantial.
If the tax year has already ended, HMRC will issue a P800 showing any over- or underpayment. You can claim refunds for up to four previous tax years.
Related tax codes: Scottish tax codes overview | S0T tax code | BR tax code
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