Paying Tax as a Student in the UK 2026: PAYE, P45s and Refunds

Most international students earn below the UK's full personal allowance across a tax year, yet many still have tax deducted from every payslip — usually because of an emergency tax code applied when a new job starts. Understanding PAYE, when refunds happen automatically, and when you need to claim, saves real money over a degree.

How PAYE works

Pay As You Earn (PAYE) is the system that deducts Income Tax and National Insurance directly from your wages before you're paid, based on a tax code your employer applies. Most people get the standard code (currently 1257L, reflecting the £12,570 allowance), spread evenly across the year — so if you only work part of the year, or part time, you may be taxed as if you'll earn far more than you actually will, and get a refund automatically once HMRC reconciles it.

The documents you'll encounter

1. P45 — given when you leave a job; shows pay and tax so far in the tax year. Give it to your next employer to avoid emergency tax.
2. P60 — an annual summary from your employer at the end of the tax year (5 April), showing total pay and tax.
3. Starter checklist — fill this in for a new job if you don't have a P45 (e.g. it's your first UK job); tick the correct statement to avoid being put on an emergency code.

Claiming a refund

• Automatic route: if you stay employed, HMRC usually corrects your tax code within a pay cycle or two once it recognises the pattern, and refunds the overpayment through your payslip.
• End of tax year: if you're still owed money after 5 April, or you left the job, claim directly via your Personal Tax Account on gov.uk, using your Government Gateway ID.
• National Insurance is different — it's calculated weekly, not annually, so working irregular hours (a big week, then nothing) can mean small NI overpayments that don't self-correct in the same way; these can be reclaimed separately if significant.

Multiple jobs or freelance income

If you hold two part-time jobs at once, only one should carry your full personal allowance (usually your main job); the second is taxed from the first pound at basic rate, which is correct and not a mistake to "fix" — it balances out at year end. If you're earning through freelance or self-employed work, note that most Student visa conditions prohibit self-employment outright — check our freelancing rules guide before invoicing anyone.

What to keep

Save every payslip and P45/P60 in one folder (digital is fine) for the length of your course — you'll need them for tax refund claims, for some visa applications, and occasionally for scholarship or bank verification.

Our Career Hub includes a plain-English tax code checker for new part-time roles, and our pricing page outlines the settling-in support package that covers National Insurance and first-payslip queries.