When does Inland Revenue class me as a student?

moped_mark

I'm currently working full time and I'm going to Uni in September. As I have got a UCAS confirmation letter saying I will be a student, does this mean that the Inland Revenue with class me as a student and I wont have to pay my normal amount of tax from my next wages?

kingarhu

Despite what many students think, their tax allowance is the same as everybody else's. The only difference is that if you only work during the holidays (i.e. Christmas, Easter and the summer) and your estimated income for the tax year is less than the personal allowance (usually £4895) then you can fill in a student tax form and not have to pay then claim back. If you work evenings, weekends or any other time during the term you will not qualify for this and will have to pay as you earn the same as every one else.
Sorry.

OMAR

spot on king

m277

Quick addition: If you don't earn more than the allowance ie £4895 in the tax year then you won't have to pay any tax. This happens even if you work weekends, evenings etc.

MarkyMarkD

well, not exactly.

If you don't register the fact, you'll pay tax if you earn the money unevenly - e.g. if you earn £4,000 in the first 6 months, and then £895 in the second six months, you'll pay tax throughout the first 6 months and then get it back in dribs and drabs over the following six. Over the year as a whole, you'll pay no tax, but in terms of cashflow you will pay some and then get it back.

wirm

so how much tax do you get taken off you if you earn more than £4???

nige

http://www.hmrc.gov.uk/rates/it.htm

The main drawback is that as National Insurance is worked out weekly rather than yearly like Income Tax, you don't get any National Insurance back if your hours drop.

LillieFlower

Best thing to do would be to wait until this time next year, then send all your payslips, P45, P60 etc for tax year 2005-06 straight off to the local inland revenue office with a covering letter explaining your employment situation for this financial year, and chances are you'll get a rebate even if you have earnt more than the £5k (or whatever it is) personal allowance limit, as long as you're not working loads of hours whilst being at uni.

My hubby did this not long ago as he graduated last year and it took him a few months of temping, etc. before he was settled into a permanent job. Inland Revenue processed things really quickly and he got over £600 back!

Well worth doing, then!!!

ohit

Guys, what about a P38(S) form?

sah10406

That's just the form you need to fill in if, as it says above, you are only working in vacations and will earn less than your allowance.

Savvy_Sue

You may not have to pay tax even if working during term time, or working throughout the year, as long as you only have one job at a time. You give your new employer your P45 from your most recent job, if you have one, and that allows your employer to work out how much tax you are due to pay on any earnings from them.

If you don't have a P45 - either because you haven't been working in the current tax year or you're planning to do two different jobs - your employer should give you a P46. If you can tick the box to say "This is my only or main job" then you should have your personal allowance set against any earnings - so if your weekly wage is going to be less than £100 you shouldn't be paying tax. (note that's a crude calculation of PA of £5000 divided by 50 weeks, which isn't accurate but will serve for the purposes of this exercise given the current state of my brain!)

Now, if you only ever have one job at a time, get a P45 at the end of each one, and keep passing them on to any new employer, your tax should stay straight. But suppose you have a term-time job at Uni, and a holiday job at home, and both employers are happy to keep you 'on the books' on that basis? OK, so you go home, say to your holiday employer "Please can I have a P46?" and fill that in to say that THIS is your only or main job - which for the next few weeks it is. When you get back to your TT employer, you ask for another P46. And so on. You, your employers and the tax offices involved may get a bit fed up with this game after a while, but in theory it should mean you get the money you're 'allowed' free of tax at the time, rather than at the end of the tax year.

Your call!

The really important thing to do, however, is if you give up ANY job, even if just by not going back to it, HAND IN YOUR NOTICE and ask for a P45. It's far easier to keep track of a few P45s than 52 weekly payslips - or more if you're doing 2 jobs in one place, in which case you will almost certainly pay tax on the lower paid at Basic Rate. Even then, if both jobs are low paid the HMRC can talk to itself so you don't pay on your full earnings on the 2nd job if your first job doesn't take you over the Personal Allowance.

I'm not just spouting off the top of my head here, I used to do the payroll for an out of school club and we had both 'home' students working in vacations and 'outsiders' working during term times. The system worked perfectly at my end, until students just didn't make contact again, and then the next thing I knew I had a letter from the Inland Revenue (as they were then) saying was I still employing them or not 'cos I hadn't given them a P45! Well I didn't know they weren't planning to come back unless they told me!

National Insurance is a completely different ballgame: once you earn over £x pw or pm in ANY job you have to pay it, and I believe someone's already posted a link to the rates.

Clear as mud now, I hope!