Paying tax on my part time job?

Jlawson118

Please forgive me if I'm in the wrong thread, but I'm new and a little uneducated on the subject of tax.

I'm a student at university, but I've recently just started a Christmas temp job in the mail sorting centre at Royal Mail. I'll be working Monday - Friday, 6pm - 10pm at £7.20 an hour, so £144 a week without deducting tax. This week was my first week so so with a week in arrears, I should be paid next Friday.
Although I was talking to a colleague yesterday about the different pay rates, and he's at an age where he knows about tax, and he was telling me to contact HMRC, request a P45 and inform them I'm a student and things and have them not deduct my tax. But I didn't quite understand.

Anyway, I was looking it up and it is saying I owe National Insurance if I earn £155 per week. So at this moment in time I won't be, but I'm considering doing some overtime when university calms down a little bit, so that'll go over the £155 mark for sure.

Any advice? I can't quote exactly what the man said but is he on the right tracks?

Dazed_and_confused

You're colleague, quite frankly, is an idiot.

HMRC don't issue P45s except in very specific circumstances, certainly not your situation, and students have to pay tax just like the rest of us.

Students do often earn smaller amounts so may not have to pay tax but that's because of low income not any special god given right to avoid tax just cause there a student.

Ask your employer for a new starter declaration form and either complete the first section (first job this tax year) or second section (had job earlier in tax year)

Worst case scenario is you will be put on the emergency tax code which currently means you can earn £211 per week before tax is deducted.

If you don't bother with the new starter declaration expect to have £28.80 tax deducted each week (from the £144). Before you ask this is NOT emergency tax.

booksurr

http://www.taxguideforstudents.org.uk

https://www.gov.uk/student-jobs-paying-tax

https://worksmart.org.uk/work-rights/young-workers/working-students/do-working-students-have-pay-tax

in a vastly oversimplified nutshell:
- income tax works on a cumulative basis and says by the end of the tax year have you earned more or less than the personal allowance. If less then you can get a refund. As a student you can (read the links above) apply for a refund earlier if you meet the criteria outlined

- NI works in isolation. There are no refunds, you very simply pay NI each and every time you get paid AND your pay in that individual payment is more than the respective threshold which is either a weekly or a monthly figure depending on whether you are paid weekly or monthly

Jlawson118

Dazed_and_confused wrote: »

You're colleague, quite frankly, is an idiot.

HMRC don't issue P45s except in very specific circumstances, certainly not your situation, and students have to pay tax just like the rest of us.

Students do often earn smaller amounts so may not have to pay tax but that's because of low income not any special god given right to avoid tax just cause there a student.

Ask your employer for a new starter declaration form and either complete the first section (first job this tax year) or second section (had job earlier in tax year)

Worst case scenario is you will be put on the emergency tax code which currently means you can earn £211 per week before tax is deducted.

If you don't bother with the new starter declaration expect to have £28.80 tax deducted each week (from the £144). Before you ask this is NOT emergency tax.

I have to admit, when he said to ask for my P45, I was a little confused because I know you get that when you exit a job, not from HMRC. I might not know much about tax but I did know that bit..

Dazed_and_confused

That's the thing you see, he could have been correct if you'd been working for HMRC then they would have given you a P45 ;-)

Farcasting

Jlawson118 wrote: »

I have to admit, when he said to ask for my P45, I was a little confused because I know you get that when you exit a job, not from HMRC. I might not know much about tax but I did know that bit..

haha yeah I dunno what your friend was on about, your correct you get a p45 when you leave employment. based on your earnings so far you shouldn't have paid any tax you can earn £211.53 a week tax free so your below that anyway not even taking into account you haven't earned anything for the first 6 months.


so yeah you don't need to do anything

chrisbur

Farcasting wrote: »

haha yeah I dunno what your friend was on about, your correct you get a p45 when you leave employment. based on your earnings so far you shouldn't have paid any tax you can earn £211.53 a week tax free so your below that anyway not even taking into account you haven't earned anything for the first 6 months.


so yeah you don't need to do anything

Apart from making a new starter declaration as advised in post 2 by Dazed and confused.

Nebulous2

If you do land up paying tax HMRC are often very helpful on the phone. My daughter at uni had two part-time jobs. A term time one away and a holiday one at home. She was paying basic rate tax on all her earnings at one of them. A phonecall meant her allowance was split in an agreed ratio between the two and a refund was paid in the next pay cycle. All very sensible and straightforward.

Darksparkle

Jlawson118 wrote: »

and he's at an age where he knows about tax

Sorry nothing useful to add, this just made me laugh!

Apodemus

Nebulous2 wrote: »

If you do land up paying tax HMRC are often very helpful on the phone. My daughter at uni had two part-time jobs. A term time one away and a holiday one at home. She was paying basic rate tax on all her earnings at one of them. A phonecall meant her allowance was split in an agreed ratio between the two and a refund was paid in the next pay cycle. All very sensible and straightforward.

I'd agree with that. HMRC get a bad press on here, but when my daughter was a student and had paid tax they sorted it out easily for her. I was burbling on about a self-assessment tax form but all she had to do was 'phone them and she got the money refunded a couple of weeks later.