Janice Lozano
International students in the UK are subject to the same tax laws as other UK taxpayers. Their tax liability depends on their residency status, domicile status, and whether their country of origin has a double taxation agreement with the UK. Foreign students generally do not pay UK tax on foreign income or gains as long as they are used for course fees or living costs. However, if their living costs exceed £15,000 in a tax year, HM Revenue and Customs (HMRC) may require an explanation. International students who work in the UK are typically liable to pay taxes and National Insurance contributions. Those who plan to leave the UK before the official end date of their course may be eligible for a tax refund.
Do international students get a tax refund in the UK?
| Characteristics | Values |
|---|---|
| Foreign income tax | Foreign students usually do not pay UK tax on foreign income or gains, as long as they’re used for course fees or living costs. |
| Double-taxation agreements | Some countries have a double-taxation agreement with the UK, which means students from those countries may not need to pay UK tax on their income if they work while studying. |
| Living costs | HM Revenue and Customs (HMRC) may ask students to account for their living costs if they exceed £15,000 in a tax year (excluding course fees). |
| Tax residence status | Students should determine their tax residence status and understand how it affects their liability to pay UK tax. |
| Work permission | Students should check if their immigration status allows them to work in the UK before considering employment. |
| Student loan repayments | International students who take out a UK student loan must make repayments through the UK tax system if they remain in the UK tax system after their course. Special rules apply if they are resident overseas. |
| Tax refund upon leaving the UK | International students planning to leave the UK before the official end date of their course may be eligible for a tax refund. |
| Tax treaties | International students may qualify for a tax refund due to tax treaties and a lack of significant income. |
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What You'll Learn
International students from outside the EEA
Tax Residence Status
Firstly, international students should determine their tax residence status. This status affects the scope of their UK tax obligations. Up to and including the 2024/25 tax year, determining one's domicile status is also necessary.
Foreign Income and Gains
Foreign students are usually exempt from paying UK tax on foreign income or gains as long as they are used for course fees or living costs. However, it is essential to check if their country of income has a 'double-taxation agreement' that covers students. If the country does not have such an agreement, students may need to pay tax on their foreign income.
Working in the UK
International students should check if their immigration status permits them to work in the UK. If they do work while studying, their tax liability will depend on the specific ''double-taxation agreement between the UK and their home country. Some agreements exempt students from paying UK tax on income earned while working, while others do not.
Tax Refunds
International students may be eligible for a tax refund if they have overpaid their taxes. This can occur when a portion of their income is automatically deducted and sent to the government as taxes, but the total amount deducted is more than what they actually owe. In such cases, students can claim a refund for the excess amount paid.
Leaving the UK Before Course Completion
If an international student plans to leave the UK before the official end date of their course, they may be eligible for a tax refund. Obtaining a letter from their academic department and discussing their situation with the Visa and International Student Advice team are necessary steps to support their tax refund claim.
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Foreign income and double-taxation agreements
Foreign students usually do not pay UK tax on foreign income or gains, as long as they are used for course fees or living costs. However, it is important to check if your country of origin has a double-taxation agreement with the UK, as this could prevent you from being taxed twice on the same income.
Double tax agreements, also known as double tax treaties or double tax conventions, are in place to provide relief in the case of double taxation. The UK has an extensive network of these treaties with other countries. The agreements can vary in their specifics, so it is important to check the exact wording of the relevant agreement. The relevant article for students is usually Article 20. Some double taxation agreements mean that students do not pay UK tax on their income if they work while studying.
If your country does not have a double-taxation agreement with the UK, you may still be able to claim unilateral tax relief on the foreign tax you have paid. This can be a complicated process, and professional advice may be needed.
It is also important to note that under UK domestic law, students have no special status in the tax system. Therefore, students are generally liable to pay UK tax and National Insurance contributions in the same way as other taxpayers. As an international student, you should determine your tax residence status and understand how this affects your liability to pay UK tax.
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Student visa and tax refund
International students in the UK are generally liable to pay UK tax and National Insurance contributions in the same way as other UK taxpayers. However, there are certain exceptions and considerations for international students when it comes to taxes and tax refunds.
Firstly, international students should determine their tax residence status and, for tax years up to and including 2024/25, their domicile status. This will help them understand their tax obligations and whether they need to pay UK taxes on their foreign income or gains. Foreign students usually do not pay UK tax on foreign income or gains as long as they are used for course fees or living costs. Additionally, some countries have a ''double-taxation agreement' with the UK, which means international students from those countries may not need to pay UK tax on their foreign income or income earned while working part-time during their studies.
If an international student is leaving the UK before the official end date of their course, they may be eligible for a tax refund. To support their tax refund claim, they should obtain a letter from their student services confirming that they have no further obligation to remain in the UK for the remainder of their course. This process involves several steps, including written confirmation from the academic department and agreement from the Visa Compliance team to report to the UKVI.
International students in the US are required to file a tax return each year as a condition of their visa. Even if they did not earn any money, they must file at least Form 8843. They may also need to file Form 1040-NR if they received income in the last calendar year. International students can file their tax returns online through the International Student Tax Return and Refund Center. If they have overpaid their taxes, they may be entitled to a refund.
Overall, while international students are generally subject to the same tax rules as other taxpayers, there are specific considerations and exceptions that may apply, depending on their country of origin and the relevant tax treaties or agreements. It is important for international students to understand their tax residence status and seek guidance from official sources to ensure compliance with tax regulations and claim any refunds they may be entitled to.
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Student loans and tax
International students in the UK with income or gains in the UK or overseas are subject to UK tax considerations. Generally, students are liable to pay UK tax and National Insurance contributions in the same way as other UK taxpayers.
Students have no special status in the UK tax system. However, there are a few exceptions. For instance, if you are an international student with foreign income or gains, you may not be taxed in the UK, as long as the money is used for course fees or living costs. This is dependent on whether your country has a 'double-taxation agreement' with the UK that covers students. In some cases, you may not be required to pay UK tax on your income if you work while studying.
Most international students from outside the EEA cannot get a UK student loan. However, limited categories of students are eligible for UK student loans, which are not taxable. Students who take out a UK student loan must make repayments through the UK tax system, like any other UK student borrower, if they are liable to pay UK tax after finishing their course (for example, if they are employed in the UK after graduating).
If you are an international student and leave the UK before the official end date of your course, you may be eligible for a tax refund. To support your claim, you will need a letter from your academic department confirming that you have no further obligation to remain in the UK for the remainder of your course. You will also need to discuss your situation with a member of the Visa and International Student Advice team, as your student visa will be cut short, and you will not be able to return to the UK for the next 12 months.
It is important to note that the rules and agreements vary, and you should consult official government sources and seek professional advice for your specific circumstances.
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Tax residence status
International students in the UK with income or gains in the UK or overseas are subject to UK tax considerations. Students do not have a special status in the UK tax system, so they are generally liable to pay UK tax and National Insurance contributions like other UK taxpayers.
Your UK residence status determines whether you need to pay tax in the UK on your foreign income. Non-residents pay tax only on their UK income, while residents pay UK tax on all their income, whether from the UK or abroad. Your residence status is usually determined by the number of days you spend in the UK in the tax year (6 April to 5 April the following year). You will be considered a UK resident if:
- You meet one or more of the automatic UK tests or the sufficient ties test.
- You do not meet any of the automatic overseas tests.
You may be considered a resident under the automatic UK tests if:
- You spent 183 days or more in the UK during the tax year.
- Your only home was in the UK for 91 days or more in a row, and you visited or stayed in it for at least 30 days of the tax year.
If you are an international student with taxable income from overseas, you need to determine your residence position under the statutory residence test (SRT) to know if you need to pay tax on that income in the UK. This can be challenging for overseas students due to their likely patterns of presence.
For tax years up to and including 2024/25, even if a student is a tax resident in the UK, they may avoid UK tax on foreign income and gains by virtue of their non-domicile status and the remittance basis. From 6 April 2025, there will be separate guidance for those with foreign income and gains.
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Frequently asked questions
Under UK domestic law, students have no special status in the tax system. Generally, international students are liable to pay UK tax and National Insurance contributions in the same way as other UK taxpayers. However, if you are an international student in the UK with income or gains from outside the UK, you usually do not pay UK tax on this as long as it is being used for course fees or living costs. It is also worth checking if your country of origin has a 'double-taxation agreement' with the UK that covers students.
A 'double-taxation agreement' is an agreement between two countries that means some people do not have to pay tax in two different countries on the same income. The agreements can vary, so it is important to check the specific agreement between the UK and your country of origin.
If you are planning to leave the UK before the official end date of your course, you might wish to obtain a letter from your Student Services to support your tax refund claim at Customs. You will need to confirm that you have no further obligation to remain in the UK for the remainder of your course, and discuss your situation with a member of the Visa and International Student Advice team.
