How Do Tax Returns Work for Students?

How Do Tax Returns Work for Students?

You’re earning money whether you work part-time around your education or do some temporary or informal work over the holidays. These small revenues are a blessing throughout your school years since they help you fund your student expenses. However, Her Majesty’s Revenue and Customs (HMRC) needs to know about your earnings. How do tax returns work for students? To find out, continue reading.

How do tax returns work for students if you have an income source?

Things are a little different when you generate your income. HMRC will not necessarily pursue you for every penny you make. However, if you earn more than £1,000 per year, HMRC would most likely consider you to be running a business. You’ll have to register as self-employed and begin filing self-assessment tax returns each year. Essentially, HMRC will want to know about all of the money that comes in and goes out of your organisation. Basically, you will only be taxed on your profits. Your expenses that you incur to live your lifestyle might typically reduce your overall tax bill. Self-assessment includes a set of dates and rules to which you must conform.

You’re a student, yet work for an employer

If you work as a student for an employer, you will usually have tax deducted from your pay via the Pay As You Earn (PAYE) system. Under PAYE, HMRC removes a portion of your income from your employer before you receive it. When it works well, it’s a relatively simple procedure. Most part-time employment will pay you in this manner, and your payslip will show how much tax and national insurance you’re paying. You must state the money generated as a self-employed person and declare the income from other sources on your self-assessment tax return each year.

What are the income tax and national insurance allowance in the UK?

If you’re a student and have a part-time job, you need to pay income tax and national insurance as follows:

Income Tax: If you earn more than £1,042 a month on average (this is called your allowance),

National Insurance: If you make more than £190 a week.

Is it necessary for international students to pay income tax?

You need to pay income tax and national insurance contributions in most situations. While studying in the UK, you must pay income tax on any earnings from work you do while a resident in the UK. Additionally, as an international student, you need not pay income tax on funds brought into the UK to fund your education. Furthermore, any assistance you get from a student loan company, bursaries, scholarships, or grants will not be subject to income tax.

Students who study part-time versus full-time

Whether you’re a full-time or part-timer, you’ll be taxed in the same manner. However, if you study part-time, you may have other duties and possibilities that change your tax situation. Similarly, you may discover that you have time for more than one job in addition to your studies. Because HMRC will identify one of your occupations as your “primary”, this can be complicated. That is the one to which your “personal” allowance will be applied.

Can international students get tax returns in the UK?

International student tax return UK refers to international students claiming their tax returns. For example, students who have been studying in the UK and want to leave can get their tax returns. To materialise, students should leave the UK for 12 months or more. These students can get VAT refunds on purchases made in the UK within the last three months.

Students tax refunds in UK

Tax is perplexing even at the best of times, but it can seem considerably more so for students working a part-time job while studying at a university. The majority of students in the United Kingdom work part-time while pursuing a degree. Unfortunately, many students are unaware of how much tax they should be paying and frequently overpay. Furthermore, many students are unaware that they may be eligible for a student tax return UK if they have overpaid. 

What should you do if you pay too much tax?

If you’re still working but have noticed that you’re paying too much tax, it’s likely because you’re on the incorrect tax code. If you face this situation, you must file a tax return to claim tax back. You can look up your exact tax code online. Notify HMRC if you have the incorrect tax code. Otherwise, your company will send you a P60 form after the fiscal year. The P60 form shows how much tax you paid on your wage throughout the tax year. This is a quick and straightforward approach to determining whether you owe a student tax return UK.

Why students commonly overpay tax

There are several reasons why students frequently pay more income tax than they need to—often without even realising it. The most prevalent scenario is that when students begin part-time employment, employers may place them on an “emergency” or “wrong” tax code (PAYE code). This occurs if you don’t provide them with a copy of your P45 proof of your tax code. Students who go on a placement year or work part-time throughout university sometimes do so over two tax years (tax years run from April to April)—this might confuse the eyes of HMRC. A part-time student tax return must be completed to get out of this condition.


Most students don’t earn more than their tax-free personal allowance in a single tax year. However, during specific periods of the year, some students prefer to work extra shifts at a part-time job (for example, over the Christmas holidays). Students may be working full-time hours and exceeding their personal allowance in some circumstances. If you think you’re due an income tax refund and want to do a tax returns check, contact Taxback UK. We’re a tax accounting firm based in Gloucester Road, West London. Taxback is one of the UK’s oldest and most comprehensive tax refund companies, specialising in non-resident tax refunds, UK tax refunds and self-assessment tax returns for anyone paying UK tax.

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