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Turn on tax code notifications in QuickBooks Payroll

by Intuit•4• Updated 1 month ago

Learn how to enable tax code notifications in QuickBooks Online Payroll.

This article is for customers who use QuickBooks Online Core, Premium, or Elite Payroll.

What does this feature do?

When enabled, QuickBooks automatically retrieves tax code changes from HMRC and applies them to employee records. You’ll see updates in the employee list, individual profiles, and during pay runs.


1. Set up HMRC notifications

To receive tax code updates:

  1. Sign in to the HMRC PAYE dashboard.
  2. Go to Messages, then select Notice Preferences and Notice Options.
  3. Set all notice options to Yes. This ensures QuickBooks can retrieve updates.

If the notice option is not set, you'll see a banner in QuickBooks advising you that the PAYE reference in incorrect.


2. Enter your HMRC credentials in QuickBooks

To allow retrieval of those tax updates:

  1. Select the âš™ icon and select Payroll settings.
  2. Go to the UK tax tab, and select the ✎ pencil icon 
  3. Scroll down to HMRC credentials.
  4. Enter your:
    • Gateway user ID
    • Gateway password

Once saved, QuickBooks will automatically retrieve tax codes from HMRC.


Where tax code notices appear

  • Employee list: You'll see alerts next to affected employees.
  • Employee profile: The updated tax code appears under tax details.
  • Pay runs: New codes apply immediately or at the next payroll.

Can I override the tax code manually?
Yes. But if you roll back a pay run, the codes may revert too. Always only change codes if instructed by HMRC.

What about employees who have left?
Tax code notices are not applied to employees leaving or who have already left.

Are regional tax codes supported?
Yes—Scottish, Welsh, and non-standard tax codes are supported.

Will HMRC still send paper notices?
Once you’re signed up for automatic updates, paper notifications should stop. If you still receive them, contact HMRC.

Is there an audit trail in QuickBooks?
Not currently. You can refer to previous payslips or reports for past codes.

Is this feature free?
Yes—there’s no extra charge to use tax code notifications.

What about student, postgraduate loans or P6/P9 notifications?

  • Student or postgraduate loan updates are not supported yet.
  • P6 and P9 tax code notices are supported. P9 codes (new tax year) show around February–March, effective from 6 April.