How to Check You Are Being Taxed Correctly

Payroll software is reliable. The inputs it receives are not. Tax codes issued on outdated information, marital status never updated, allowances not applied, a starter form never processed: none of these are software failures and all of them produce wrong deductions that persist quietly for years.

The check below takes about twenty minutes and applies to any of the countries on this site.

Step one: verify the identifiers

Your tax code or equivalent. UK tax code, Irish tax credit certificate, German Steuerklasse, Dutch payroll tax credit indicator, French withholding rate, US W-4 settings. Each one is a single field that changes everything downstream.
Your contribution status. Pension scheme membership, opt-outs, health insurance fund, church tax flag. These are frequently set on day one and never revisited.
Your personal details. Marital status, number of children, date of birth. Age triggers relief in several systems, notably Irish pension limits and Dutch credits.

A wrong tax code is by far the most common single error. If your circumstances changed in the last two years, marriage, a child, a second job, a company car removed, a benefit added, there is a reasonable chance the code did not follow.

Step two: rebuild the calculation yourself

Take your annual gross from the most recent payslip's year to date column and run it through a calculator for your country. Compare the annual net with twelve times your monthly net, adjusting for any bonus.

If the two figures are within a percent or two of each other, nothing is badly wrong. If they differ by five percent or more, something is. The most likely causes in order are: a wrong tax code, an unexpected benefit in kind being taxed, a pension contribution you did not know about, and a student loan deduction.

Step three: check the deductions line by line

Line	What to verify	Common error
Income tax	That the code or rate matches your circumstances	Emergency or second job basis left in place
Social contributions	That the rate matches the published rate and the ceiling is applied	Ceiling not applied after a job change mid year
Pension	That the percentage matches what you agreed	Auto enrolment default never changed, or opt-out never processed
Student loan	Correct plan type	Wrong plan deducts at the wrong threshold
Benefit in kind	That the value matches the benefit you actually have	A car returned but still on the record
Local or church tax	That it matches your municipality and religious status	Church tax charged after leaving the church

Church tax is worth a separate mention because it is charged by default in Germany and Austria on the basis of a registration record, and stopping it requires a formal step. Covered in church tax in Germany.

Step four: check the year end documents

Every system produces an annual statement, and it is the document that matters if anything needs correcting: the P60 in the UK, the Lohnsteuerbescheinigung in Germany, the jaaropgave in the Netherlands, the W-2 in the United States, the Employment Detail Summary in Ireland. Check that the gross figure matches what you were paid and that the deductions match the sum of your payslips.

Keep them. Most countries allow corrections going back four years, and a claim without documents is much harder. The UK paperwork is described in P45, P60 and the rest.

What to do when something is wrong

Raise it with payroll first, in writing, with the specific line and the figure you expected. Most errors are fixed in one cycle.
If it involves your tax code or credits, contact the tax authority directly. The employer cannot change a code without instruction.
Claim backwards. Almost every system allows retrospective correction, generally three to five years. A wrong code corrected without a backdated claim leaves the earlier money with the state.
Where an overpayment of contributions is involved, notably contribution ceilings applied twice after a job change, say so explicitly. These are rarely refunded automatically.

Related: How to read a payslip