Janice Lozano
If you're a student with a job, you may need to pay National Insurance (NI) and Income Tax. This depends on how much you earn and whether you work for yourself or an employer. National Insurance is typically deducted from your pay if you earn over £242 per week, which equates to around 12% of your income. If you're a full-time student with a holiday job, you may not need to pay tax through PAYE, but you will still pay National Insurance if you earn more than the weekly threshold. If you work for an employer, they will make the necessary deductions. If you work for yourself, you will need to fill in a Self Assessment tax return each tax year, declaring your income and expenses.
When do you pay national insurance as a student?
| Characteristics | Values |
|---|---|
| Full-time student with a holiday job | No need to pay tax through PAYE but must pay National Insurance if earning more than the weekly threshold |
| Part-time job during term time | Cannot use form P38(S) and must pay tax and National Insurance |
| Self-employed | Must fill in a Self Assessment tax return each tax year and pay National Insurance |
| Working abroad for a UK employer | Required to pay National Insurance while abroad |
| Working abroad for a foreign employer | Do not need to pay National Insurance in the UK but may have to pay foreign contributions |
| Working in the UK while studying | Must pay UK tax and National Insurance |
| International students | Required to pay National Insurance contributions and cannot get refunds |
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What You'll Learn
National Insurance thresholds
The way National Insurance is paid is set to change in 2025, affecting almost everyone who works in the UK, whether employed or self-employed. The Apprentice Upper Secondary Threshold will be introduced, affecting how employers calculate contributions for apprentices. The upper secondary thresholds will also be adjusted, impacting contributions for various employment categories, including under 21s, apprentices, and veterans.
For employees, National Insurance is paid through the PAYE (Pay As You Earn) system, alongside income tax, student loan repayments, and any apprenticeship levy that the employer is liable to pay. The self-employed contribute partly through a fixed weekly or monthly payment and partly on a percentage of net profits above a certain threshold.
The Lower Earnings Limit (LEL) is the threshold below which no National Insurance is paid. However, earning above this limit helps qualify for certain benefits, such as the State Pension. The Upper Earnings Limit (UEL) is when the rate drops from 12% to 2% on earnings. The Secondary Threshold is when employers start paying National Insurance contributions for their staff. For the 2025-2026 tax year, the upper earnings limit is £125,140, which is also the upper secondary threshold. If you earn under a certain weekly amount, you won't pay any National Insurance at all, and earnings above a certain weekly amount will only be charged at 2%.
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Tax and National Insurance for self-employed students
Students who work while studying may need to pay income tax and National Insurance. If you work during the holidays, either in the UK or abroad, you will still count as a UK resident for that tax year and be liable for UK tax on anything you earn above the personal allowance. If you work for a foreign employer, you do not need to pay National Insurance in the UK, but you might have to pay contributions in the country you are working in.
If you are self-employed, you will 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. You must register as self-employed within three months of starting work. To do so, call the Newly Self-Employed helpline. You can also find out more about tax and National Insurance for the self-employed and how to complete a tax return by calling the HM Revenue and Customs newly self-employed helpline.
If you work for an employer during term-time, any income tax and National Insurance due will be deducted from your wages before you receive them. This is known as Pay As You Earn (PAYE). Everybody can earn a certain amount before they start paying income tax, which is called the personal allowance. For every tax year, you will begin making National Insurance contributions when you earn above a certain amount, called the earnings threshold. When you leave a PAYE job, your employer will give you a Form P45, which you will need to give to your next employer to ensure you don't pay too much tax in the future.
If you normally live in the UK and work abroad for a UK employer, you will be required to pay National Insurance while abroad. If you work for a foreign employer, you will not normally pay National Insurance in the UK, but you may have to pay foreign contributions, which may count towards Social Security benefits in the UK. If you have overpaid your income tax, you can use the student tax checker to find out if you could be due a refund. You may also be entitled to reclaim tax you've paid when you leave by filling in a form P85 and sending it to your Tax Office.
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National Insurance for international students
In the UK, international students are allowed to work while studying, but there are restrictions on the type of work they can do. Working in breach of visa conditions is a criminal offence. International students are required to pay National Insurance (NI) contributions if they work in the UK. If you already have a National Insurance number from previous work or study in the UK, you don't need to reapply for one. If you don't have an NI number, you must apply for one online once you're in the UK. To obtain an NI number, you must have the right to work or study in the UK. It is possible to apply for an NI number while looking for work, and you can even start working without one, but you must apply as soon as you start working.
Some jobs, such as working for the University of Hertfordshire, require you to show your NI number as part of the student application pack. Additionally, you may be required to pay income tax on your earnings, depending on your Personal Allowance (PA) threshold. This means that you will become liable to pay income tax once your earnings exceed your PA.
It is important to note that there have been reports of students falling prey to job and visa scams. It is the employer's responsibility to conduct a right-to-work check to ensure that students can work full-time hours during vacation periods. Students can protect themselves from scams by checking their programme specifications, timetables, or consulting their schools.
In terms of National Insurance contributions during university, there may be gaps in your NI record if you were a full-time student. These gaps may impact your eligibility for certain benefits or your pension in the future. It is possible to voluntarily pay the shortfall for those years, but there may be time limitations, and you may need to work longer to make up for the missing contributions.
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National Insurance for students working abroad
Students in full-time education do not have to pay National Insurance. However, if you are a student with a part-time job, you will need to start paying National Insurance. You can start working before you receive your National Insurance number, but only if you can prove your right to work in the UK. You will normally be sent a National Insurance number in the three months before your 16th birthday. You can also apply for one if you plan to work, but you can only apply from within the UK.
If you are a student working abroad, you may still need to pay National Insurance in the UK. This depends on where you are working, how long you will be working there for, and whether the country has a social security agreement with the UK. If the country does have a social security agreement with the UK, you will need to get a ''certificate of coverage' to show that you are paying National Insurance in the UK and do not need to pay social security contributions in the country where you work. You will need to pay National Insurance in the UK for the first 52 weeks of working abroad.
If you are relocating abroad permanently, you will usually stop paying National Insurance in the UK and pay social security in your new country of residence. However, you have the option to pay voluntary Class 3 National Insurance while abroad to qualify for the UK state pension in the future. If you are relocating abroad temporarily, you may continue to pay National Insurance in the UK, depending on the length of your stay and the country you are relocating to. HMRC has launched an interactive guidance tool to help individuals and agents determine whether they should pay National Insurance while working abroad.
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National Insurance for students with holiday jobs
If you're a student with a holiday job in the UK, you may need to pay tax and National Insurance, depending on how much you earn and whether you're working in term-time or the holidays. If you're working for an employer, they will deduct any income tax and National Insurance contributions from your wages before you receive them. This is known as Pay As You Earn (PAYE).
If you're a full-time student with a holiday job, you may not need to pay tax through PAYE, but you will still pay National Insurance if you earn more than the weekly threshold of £162. You can ask your employer for a form P38(S) if you're a full-time student in the UK, only working during the holidays, returning to full-time education after the holidays, and your total income for the year is below the personal allowance.
If you have a part-time job during term-time, you can't 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 due a refund.
Previously, students could declare their student status and be paid tax-free, but now they have to pay tax and National Insurance like any other worker and then reclaim it. Any student who earns less than £11,850 during the tax year, including any term-time work added to summer earnings, can claim their tax back in April.
If you're a foreign student working in the UK or a UK student working abroad during the holidays, you may still need to pay tax and National Insurance. If you work abroad for a UK employer, you will be required to pay National Insurance. If you're taxed by a foreign employer and can't claim the tax back from them, you may be able to claim a deduction or credit in the UK.
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Frequently asked questions
If you're a student and you have a job, you'll have to pay National Insurance if you earn over a certain amount. This amount is typically £242 per week.
International students are also required to pay National Insurance contributions. You can apply for a National Insurance number once you arrive in the UK.
If you're a full-time student with a holiday job, you may not need to pay tax through PAYE, but you will still pay National Insurance if you earn more than the weekly threshold. You can ask your employer for a form P38(S).
