How N codes work
A standard L code is 1257L (£12,570 allowance). N codes have 10% transferred to the spouse:
- £12,570 - £1,260 = £11,310 remaining allowance
- Tax code: 1131N
You should only have an N code if:
- You're the lower-earning partner in a married couple or civil partnership
- Your earnings are below £12,570 (or unemployed)
- Your spouse is a basic-rate taxpayer (earnings £12,570–£50,270)
Why N is "free"
Marriage Allowance is designed so the giver loses nothing:
- If you earn £0–£11,310: you'd pay £0 Income Tax either way — your full allowance is unused
- If you earn between £11,310 and £12,570: you'd pay 20% Income Tax on the slice between your remaining allowance (£11,310) and your actual earnings
- If you earn over £12,570: you no longer qualify to give Marriage Allowance away
The sweet spot is "I earn £0–£11,310" — the £1,260 transferred would otherwise be unused. Giving it to a basic-rate-paying spouse saves the household £252.
When N starts costing you
If your circumstances change and you start earning over £11,310 but below £12,570:
- Without Marriage Allowance: £11,310 + (£12,570 - £11,310) - all tax-free = £0 tax
- With Marriage Allowance (N code): £11,310 tax-free + (earnings - £11,310) × 20% Income Tax
For someone earning £12,000 with N code: - Taxable: £12,000 - £11,310 = £690 - Income Tax: £690 × 20% = £138
But their spouse saves £252 with the M code. Household net: still £114 better off (£252 - £138).
The arrangement still benefits you as a household until your earnings exceed roughly £13,830, at which point your tax-cost wipes out the household saving.
When to cancel
Cancel Marriage Allowance if:
- Your earnings are approaching or exceeding £12,570 (you'll start paying tax that wouldn't otherwise be due)
- Your spouse's earnings will exceed £50,270 (they no longer qualify as a basic-rate taxpayer)
- You divorce or dissolve a civil partnership
- Either partner dies (special rules apply)
How to cancel: - Log in to your Personal Tax Account at gov.uk - Or call HMRC on 0300 200 3300
Cancellation usually takes effect from the next tax year, though HMRC can apply mid-year for major life events.
Tax code N in Scotland and Wales
Scottish and Welsh taxpayers see SN1131 or CN1131 (the format may vary — most commonly S1131N or C1131N). The transfer amount is the same £1,260; the Scottish/Welsh band structure applies to any taxable income above the reduced allowance.
Common questions
Will HMRC tell me my code changed? Yes — a P2 Notice of Coding letter arrives when your code changes to N. Sometimes also a message in your Personal Tax Account.
Why isn't the N saving showing up on my payslip? Because the saving isn't yours — it's your spouse's. Your N code means you have a smaller allowance; your spouse's M code is where the £252 saving lands.
What if my spouse forgets to apply? Without their application, you can't have an N code. The arrangement is initiated by the lower earner (giver) via gov.uk.
Can I be on a custom N variant? Yes — codes like 1131N can occasionally appear as something else (e.g. 1100N) if other adjustments stack on top, but the underlying mechanic stays the same: 10% transferred allowance.
The household-level view
Marriage Allowance is fundamentally a household tax-planning measure, not an individual one. The M-code recipient sees the saving; the N-code giver experiences a reduced allowance that costs them nothing in most cases.
If you're the lower earner and you're not on N, check if your spouse qualifies as a basic-rate taxpayer: - They earn between £12,570 and £50,270 - You earn under £12,570
If both true, you're missing £252 a year of household savings. Apply at gov.uk/apply-marriage-allowance (free) and backdate up to 4 years if you also qualified then (up to £1,008 refund).
In short
Tax code N means you've given 10% of your personal allowance to your spouse via UK Marriage Allowance. Your remaining tax-free amount is £11,310 (1131N). You should only do this if your earnings are below £12,570 — then it costs you nothing. Your spouse's matching M code saves the household up to £252 a year. For the full reference, see the tax codes hub →. For the receiver perspective, see tax code M →.