You might have heard that students do not have to pay tax and National Insurance, but unfortunately that is a myth!
Yes, you probably do need to pay tax and National Insurance
Students are subject to the same tax rules as everyone else. While most allowances, grants, and student loans are not considered taxable income, earnings from paid work are.
For the 2024/25 tax year:
- You will need to pay Income Tax if you earn more than £1,048 per month (£12,570 per year).
- National Insurance contributions (NICs) apply if you earn over £242 per week (£1,048 per month).
If you are employed, your employer will automatically deduct tax and National Insurance from your wages. When changing jobs, provide your new employer with your P45 to ensure you are taxed correctly. If you don’t have a P45, you will need to complete a starter declaration instead.
International students
International students, be sure to check the gov.uk website for details on tax on foreign income. Scroll down to the section "If you work in the UK" for relevant information. You can also find guidance below on applying for a National Insurance number.