For the tax year beginning 6th April 2016 HMRC will cease to use the suffix 'Y' on tax code notifications P2, P6 and P9. As the personal tax allowance in 2016-17 will increase from £10,600 to £11,000 it will result in the basic personal allowance being higher than the maximum personal age allowance of £10,660 for people born before 6th April 1938.
All employers or pension providers will receive a P9 coding notification for the 2016-17 tax year advising the correct tax code for all individuals affected. All individuals who would have had a 'Y' suffix in their tax code previously will be issued with a P2 notice of coding informing them of their new tax code.
HMRC's systems will still accept the 'Y' suffix if submitted but HMRC have requested the 'Y' suffix not to be used by employers or payroll agents.