That's how it works. You indicate if you want the company to take the tax free threshold (you only want to do this for one job if you have multiple), and then you can also elect to tell your employer(s) an estimated taxable income and they'll use that. Otherwise they just assume your income from that job is your taxable income.

At the end of the year you file online and put in your deductions, which hopefully cover any other taxable income (capital gains, dividends, interest, etc.) if you didn't give your employer a higher figure. Then you pay if you're owing or get a refund if not.