HMRC’s 5 Critical Warnings For Christmas Workers: How To Avoid Emergency Tax And Festive Scams
The festive season is one of the busiest times of the year for temporary employment across the UK, with millions of people taking on seasonal roles in retail, logistics, and hospitality. However, as of December 2025, HM Revenue and Customs (HMRC) has issued an urgent and official "Check Your Pay" warning specifically aimed at this influx of temporary staff, urging them to scrutinise their payslips immediately to prevent significant financial mistakes and potential overpayment of tax.
This critical advice comes as HMRC recognises that seasonal workers, including students and those on short-term contracts, are highly susceptible to errors in their pay, most notably being placed on an incorrect or "emergency" tax code. The financial consequences of ignoring this warning can mean a considerable chunk of your Christmas earnings is unnecessarily deducted, leaving you with less money when you need it most.
The HMRC 'Check Your Pay' Warning: Who Needs to Act Now
The HMRC warning is not limited to a single sector but applies to anyone who has taken on a temporary or seasonal role during the Christmas and New Year period. This includes:
- Retail Staff: Those working extra hours in shops and supermarkets.
- Logistics and Delivery Workers: Couriers and warehouse staff managing the holiday shipping rush.
- Hospitality Employees: Bar and restaurant staff catering to festive parties.
- Students: Those working during university holidays.
- Short-Term Contract Workers: Anyone employed for a limited period.
The core message is simple: you must check your payslip *now*, not wait until the end of the tax year. HMRC has highlighted two major areas of concern for seasonal staff: tax errors and minimum wage compliance.
1. The Emergency Tax Code Trap: Why You Might Be Overpaying
One of the most common and costly issues HMRC sees with seasonal employment is the automatic application of an emergency tax code. When an employer takes on a new worker, especially one who hasn't provided a P45 from a previous job or is starting their first job, they often default to a temporary or emergency tax code (such as 0T, M1, or W1/M1).
An emergency tax code assumes you have no tax-free personal allowance remaining for the year, meaning you are taxed on virtually all your earnings at a higher rate than necessary. For a student or a person with a main job who is simply earning a small amount of extra cash over Christmas, this can lead to a significant overpayment of income tax right away.
Your Action Plan to Fix an Emergency Tax Code:
- Check Your Payslip: Look at the tax code listed. If it seems wrong or has "W1" or "M1" at the end, it is likely an emergency code.
- Contact Your Employer: Provide them with your P45 (if you have one) or fill out a 'Starter Checklist' (P46 replacement) to give them the necessary information about your previous income and tax status.
- Contact HMRC Directly: If your employer cannot resolve the issue quickly, you need to contact HMRC on their helpline or via your Personal Tax Account. You will need your National Insurance number and details of your employment.
While any overpaid tax is usually refunded later, either automatically or through a claim, the HMRC warning stresses that you should fix it immediately to have the correct money in your pocket for the festive period.
2. National Minimum Wage and Unpaid Hours Compliance
Beyond tax issues, HMRC is also urging temporary seasonal staff to ensure they are being paid at least the National Minimum Wage (NMW) or National Living Wage (NLW), depending on their age.
In the high-pressure environment of Christmas work, underpayment can occur in several subtle ways:
- Unpaid Training: Being asked to complete mandatory training or induction sessions without pay.
- Unpaid Travel Time: Not being paid for time spent travelling between work locations.
- Deductions for Uniforms: Having wages deducted for necessary work attire, which can sometimes push the effective pay below the minimum wage threshold.
- 'Trial' Shifts: Being asked to work an unpaid trial shift that goes beyond a reasonable assessment period.
HMRC encourages workers to keep a meticulous record of all hours worked, including start and finish times, breaks, and any time spent on training. If you suspect you are being underpaid, you can report your employer to HMRC confidentially.
3. The Urgent Threat of Festive Tax Refund Scams
As seasonal workers are more likely to receive legitimate correspondence from HMRC regarding their pay and tax status, this period becomes a prime target for sophisticated scammers.
HMRC has issued a strong scam warning against unsolicited communications, particularly those offering an immediate tax refund or demanding urgent payment.
How to Spot an HMRC Scam:
- Unexpected Contact: HMRC will never email, text, or call you out of the blue to tell you about a tax refund. They will usually send a letter or use your secure Personal Tax Account.
- Sense of Urgency: Scammers often use threatening language or a false sense of urgency (e.g., "Act within 24 hours or lose your refund").
- Request for Personal Details: Never provide bank details, passwords, or your National Insurance number in response to an email or text message.
- Unusual Payment Methods: HMRC will never ask for payment in the form of gift cards, iTunes vouchers, or cryptocurrency.
If you receive a suspicious email or text claiming to be from HMRC, you should forward the email to phishing@hmrc.gov.uk or the text to 60599 and then delete it immediately. Do not click on any links.
4. Understanding Your Tax Status When You Have Two Jobs
For individuals who have a primary job and take on a temporary Christmas job for extra income, understanding your tax code is even more crucial. Your Personal Allowance (the amount you can earn tax-free) is usually applied to your main job.
When you start a second job, your new employer should be informed that it is your secondary source of income. If the tax code for your second job is the same as your main job, you will likely be under-taxed in the second job, leading to a tax bill later, or over-taxed if the new employer incorrectly applies the full Personal Allowance. You should ensure your second job has a tax code that correctly reflects that you have no Personal Allowance left (e.g., BR for Basic Rate or D0 for Higher Rate).
5. The Importance of Your Personal Tax Account (PTA)
HMRC’s final piece of advice for all Christmas workers is to use the digital tools available. Your Personal Tax Account (PTA) is the most secure and reliable way to check your tax status, view your income from all jobs, and see what tax code is currently being used by each employer.
By logging into your PTA, you can often spot and correct an incorrect tax code much faster than by waiting for a letter. This proactive step is the best defence against the common tax errors faced by seasonal staff and ensures you receive the full amount of wages you are entitled to this holiday season. Don't let a simple administrative error or a scammer steal your hard-earned Christmas cash. Check your pay today.
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