Janice Lozano
Students in the UK who take up employment are often subject to the same rules as other workers in the country. This means that, in addition to income tax, they will also have to pay National Insurance if their income exceeds a certain threshold. However, there are some exceptions to this rule, and students may be able to reclaim any tax they have overpaid.
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What You'll Learn
Students with holiday jobs
If you're a full-time student with a holiday job in the UK, you may not need to pay tax through PAYE, but you will still pay National Insurance if you earn more than £166 per week. You can ask your employer for a form P38(S) if:
- You are a full-time student in the UK, only working during the holidays.
- You are returning to full-time education after the holidays.
- Your total income for the year is below your personal allowance.
If you have a part-time job during term time, you cannot use form P38(S) just for your holiday job. Your employer will take care of the paperwork to make sure you don't pay too much tax. If you think you've overpaid your income tax, you can use the student tax checker to see if you could be owed a refund.
If you work for yourself, you will need to fill in a Self Assessment tax return each tax year, on which you declare your income and expenses. This allows HM Revenue & Customs (HMRC) to work out how much tax you need to pay. You must register as self-employed within three months of starting work. You should tell HMRC as soon as you start working for yourself.
If you normally live and study in the UK but work abroad during the holidays, you will still count as a UK resident for tax purposes. You will be liable for UK tax on anything you earn abroad above your personal allowance. However, if your overseas employer also taxes you and you are unable to claim this back directly from foreign authorities, you will probably be able to claim a deduction or credit in the UK.
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Foreign students working in the UK
Students working in the UK will normally pay UK tax and National Insurance if they earn more than £1,042 a month and more than £166 a week, respectively. However, they may be entitled to reclaim the tax they've paid when they leave by filling in a P85 form.
The type of work that foreign students can undertake is also restricted. UK law prevents people on student visas from working as doctors, dentists, sports coaches, or sports persons, unless required as an integral part of their degree course. They are also prohibited from engaging in business, which includes setting up a business or being hired by a company where they own 10% or more of the shares.
Foreign students should also be aware that their university may impose other restrictions on whether and how much they can work. These limitations vary between institutions, so it is essential to check with the university before applying for jobs.
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Self-employed students
If you are a student in the UK and plan to get a job to earn some extra cash, you will have to pay income tax if you earn more than £1,042 per month and National Insurance if you earn more than £166 per week. If you are self-employed, you may have to pay National Insurance contributions (NIC). The type of National Insurance you pay depends on your employment status and how much you earn. If you are employed, you pay Class 1 National Insurance, whereas if you are self-employed, you pay Class 2 and/or Class 4 National Insurance.
Class 2 NIC is a fixed weekly amount: £3.50 per week for 2025/26 and £3.45 per week for 2024/25. You don't have to pay Class 2 contributions if you have profits above £12,570. From 6 April 2024, self-employed taxpayers will no longer need to pay class 2 NIC. However, in certain circumstances, you may wish to pay class 2 NIC voluntarily.
Class 4 NIC is calculated based on your profits from self-employment once they are more than a certain level. If you pay a maximum amount of annual NIC by way of class 1, you may not need to pay the full amount of class 4 NIC. If this is the case, then you will have to pay 2% class 4 NIC on all profits above the level of £12,570 (for 2024/25 and 2025/26). Your class 4 NIC liability will be automatically calculated as part of the self-assessment process.
If you work for yourself, you will need to fill in a Self Assessment tax return each tax year, on which you declare your income and expenses. This allows HM Revenue & Customs (HMRC) to work out how much tax you need to pay. You should tell HMRC as soon as you start working for yourself. When you register with HMRC as self-employed, the registration covers both income tax and National Insurance. You can find out about registration at Self-employment: registering for tax and NIC.
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Student tax refunds
Students working part-time jobs in the UK are often eligible for tax refunds. Many students are unaware that they could be owed money by HM Revenue and Customs (HMRC).
If you are a student in the UK and have been working, you can check if you are due a tax refund by filling out a form with Taxback UK Student Tax Refunds. Tax agents can also help you claim your tax refund for a small commission.
Students can also use the student tax checker to find out if they could be owed a refund. If you are self-employed, you will need to fill in a Self Assessment tax return each tax year, on which you declare your income and expenses. This allows HMRC to work out how much tax you need to pay.
If you are an international student, you can claim a tax refund when you leave the UK, but you will need to discuss your situation with a member of the Visa and International Student Advice team.
Students are exempt from paying council tax, but they are still required to pay income tax. If you are earning more than £1,042 per month, you will need to pay income tax. You can claim back overpaid income tax by filling in a P85 form and sending it to the Tax Office.
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National Insurance credits
Students in the UK who work alongside their studies typically pay UK tax and National Insurance. However, if you are not paying National Insurance, you may be able to get National Insurance credits. These credits can help fill gaps in your National Insurance record, ensuring you qualify for certain benefits, including the State Pension.
There are two types of National Insurance credits: Class 1 and Class 3. In certain circumstances, you may be given National Insurance credits even if you are not working. The main benefit they count towards is the State Pension. To receive these credits, you must be aged 16 or over and below State Pension age for the year in which you may be credited.
There are many circumstances in which you might be eligible to receive National Insurance credits, including being unable to work due to illness or caring for someone. If you are responsible for a child or children, you may be eligible for credits that count towards the State Pension. For instance, if you are an approved foster carer or kinship carer of a child under the age of 12, you can apply for National Insurance credits using form CF411A. If you are a grandparent or other family member of a child under the age of 12 who you look after because their parents or main carers are working, you may be able to claim specified adult childcare credits.
In some circumstances, you should be given National Insurance credits automatically, for example, if you receive Universal Credit, Carer's Allowance, or new-style Employment and Support Allowance.
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Frequently asked questions
If you work in the UK while studying, you'll normally pay UK tax and National Insurance if you earn over a certain amount. This threshold is £166 per week.
If you work for yourself, you'll need to fill in a Self Assessment tax return each tax year, declaring your income and expenses. This allows HM Revenue and Customs (HMRC) to work out how much tax you need to pay.
If you work abroad for a UK employer, you will be required to pay National Insurance while you are abroad. If you work abroad for a foreign employer, you will not normally pay National Insurance in the UK, but you may have to pay foreign contributions.
You may be entitled to reclaim tax you've paid when you leave by filling in a P85 form and sending it to your Tax Office. Your employer will have the details for this.
