You're probably owed money - here's how to claim your tax back

how to claim tax back students

How does income tax work?

In the UK, you’re entitled to earn £10,600 per year for free - this is known as your ‘personal allowance’, and it’s only the money you earn after this that you should get taxed on.

Tax rates then vary according to how much you earn. If after the tax-free £10,600 your annual pay is £31,865 or less, you’ll pay the ‘basic rate’ of tax, which is 20%. If you earn more than this you’ll pay 40% tax, and 45% if you earn over £150,000.

As well as income tax, you are also required to make National Insurance contributions if you earn over £153 per week.

How much do students pay?

Students who have occasional, temporary or part time work are unlikely to earn more than £10,600 in a year so should not pay any tax in this case.

Students working full time may earn more than this, so will pay 20% tax on whatever they earn after the first £10,600 (and 40-45% if they earn a lot more, as above).

Why would students get overcharged?

This is where it gets a bit shocking. It is estimated that around 90% of former students who were employed whilst at uni are owed tax back.

This is down to a number of reasons:

  • Students often work part time, but their hourly rate is added up to an annual wage as if they worked 40 hours per week (full time)
  • Students often work on a temporary basis, so employers often give them a generic or ‘emergency’ tax code, which means they automatically get charged the basic rate of tax
  • Students often have not had a previous job and so will not have a p45 tax form which is given to the new employer from the old employer, which again means the new employer will use an ‘emergency’ tax code

How do I know if I've overpaid? has a handy calculator that allows you to calculate how much tax you’re owed - you can find it here. You could also win a £10 Amazon voucher by using it!

How do I get it back?

You can claim overpaid tax back for this tax year (April to April) or any of the four tax years before that, so any periods you’ve been employed for since 2009/10

If you’re still working…

  • Call HMRC on 0300 200 3300 (0300 numbers come out of your minutes as normal when calling from a mobile s you won’t be charged)

If you’ve left work…

  • Download a p50 here, fill out sections 2 and 3 and send them to HMRC, and keep section 1 as your own copy
  • If you’re still confused, call HMRC on the number above for advice

Check out our other Money Making Ideas here