D0 charges the higher rate on every pound from that job or pension, and D1 charges the additional rate. Neither gives you any Personal Allowance. They are used for a second source of income when your allowance and your basic-rate band are already fully used at the first one. In Scotland the same letters mean different rates: SD0 is the Scottish intermediate rate, not the higher rate.
What each code does
There is no number in either code, because neither gives you any tax-free pay.
D0 charges the whole of the taxable pay at the first higher rate, in HMRC's words. For England, Wales and Northern Ireland that is 40% on every pound from that job or pension. On a second income of £20,000, the income tax is £8,000.00 and you are left with £11,406.12.
D1 charges the whole of the taxable pay at the second higher rate, which is 45%, the additional rate. It appears where your income elsewhere has already filled the higher-rate band.
Both are flat codes. They do not step up through the bands as the pay from that job grows, and they never hand back an allowance. The tax on that job is the same on the first pound as on the last.
Why HMRC issues them
D0 and D1 are second-source codes. HMRC uses them when your allowances and your lower rate bands are fully given at your main job. Any further income is then genuinely taxable from the first pound at that higher rate.
That holds while your income is stable. It goes wrong when the main job pays less than expected, when one job ends part-way through the year, or when a bonus that never arrived was in the estimate. The flat code then takes more tax than the year justifies, and the excess comes back after HMRC reconciles the year.
The Scottish codes are not what the names suggest
This is the detail that trips people up. Scotland has more rate bands than the rest of the UK, so the D numbers sit at different points on the ladder.
SD0 deducts tax at the Scottish intermediate rate, 21%, not the higher rate. SD1 deducts at the Scottish higher rate, 42%. SD2 deducts at the Scottish advanced rate, 45%. SD3 deducts at the Scottish top rate, 48%.
Read SD0 as "the higher rate" and you will expect far more tax than the code actually takes. Move from Scotland to England with the same second job and the deduction changes even though the pay has not.
In Wales, CD0 is the Welsh higher rate and CD1 the Welsh additional rate. Welsh rates are set by the Welsh Government and match the rest of the UK for 2026/27, so those codes take the same tax as D0 and D1 this year.
Cumulative, or week 1 and month 1
The basis decides who puts an over-deduction right, so it is worth knowing which one you are on. Look at your payslip for a W1, M1 or X after the code rather than assuming. HMRC's PAYE manual states that D0 and D1 can each be issued cumulatively or on a week 1 or month 1 basis.
On the cumulative basis, the payroll looks at the year to date each pay day and can correct an earlier over-deduction itself. On a week 1 or month 1 basis it cannot: your employer works out the tax on each payment on its own, so if the code turns out to be too heavy, the correction comes from HMRC rather than from your employer's next run.
What to do if the code looks wrong
D0 and D1 are built from what HMRC expects you to earn everywhere. Check those figures in the check your Income Tax service and correct anything out of date: a job you have left, a pension you have not started, an estimate from a year when you worked more hours. HMRC reissues the codes to your employers from there.
A D0 on a sole employment is worth looking at for a different reason. With one job, the normal answer is an allowance code, because your Personal Allowance and basic-rate band have nowhere else to be used. A D0 on its own usually means HMRC is still expecting income from somewhere else, and the check your Income Tax service shows what it has on record.
Is D0 worse than BR?
It takes more tax on the same pay, because BR charges the basic rate and D0 charges the higher rate. Neither is a penalty. Each is an estimate of the rate your next pound of income should face, based on what HMRC expects you to earn everywhere, and each is corrected the same way when the estimate is out of date.
Does National Insurance follow the code?
No, and it does not follow your other job either. National Insurance takes no notice of your tax code. It is charged on each employment's pay in its own right, in each pay period, against the threshold prescribed for that period: £1,048 a month if you are paid monthly, rather than the annual threshold of £12,570.
That is the reverse of income tax, which D0 and D1 exist to share out across your jobs. Two second incomes can each sit below the threshold for the period and attract no employee National Insurance at all, even while D0 is taking the higher rate on one of them. It works differently if both jobs are with the same employer, or with employers who carry on business in association with each other, because those earnings are added together first.