NAT 88.09
As many full-time students prepare to find temporary work over
the Christmas period, they may find that they are in line for tax
free income.
HM Revenue & Customs (HMRC) is reminding them that they
may not need to pay income tax on their earnings, if these are
below their Personal Allowance for the year.
The good news for many full-time students who are intending to
work over the festive season is that - providing they expect to
earn less than £6,475 in the tax year to 5 April 2010 and complete
a form P38(S) at the beginning of employment - they will be
entitled to receive their money tax free.
Students can find all the information they need at: www.direct.gov.uk/studenttaxadvice.
Furthermore, students who have worked part-time throughout the
year, and think they may have paid too much tax, could be eligible
for a cash refund. They can either use the student tax calculator
on our website (http://www.hmrc.gov.uk/calcs/stc.htm),
or visit the HMRC tax fact Facebook application, Universilly
Challenge. This encourages students to get the lowdown on the tax
facts that matter to them.
Three out of every four students take paid work, and if they have
worked part-time during term-time, or intend to get a temporary
Christmas job, HMRC wants to help them to get the facts about tax
right so that they don’t pay more than absolutely necessary on
their hard-earned cash.
Jane Frost, Director of HMRC Individuals Customer Directorate, said:
“Before starting any vacation job, it’s a good idea to make sure
you know about tax.
“Making sure your tax code is right from the start of your paid
employment can save you money and is good training for life after
graduation. We want to help students understand how the tax system
works so they don’t pay more than they should and also get back
what is due.”
Notes to Editors
1. Key questions for
Students
As well as being aware of their Personal Allowance, students
should also find out:
· What do I do with forms such as the P45, P60 and P38(S)?
Students who plan to work only during the holiday periods, and
expect to earn no more than the Personal Allowance (currently
£6,475) in the tax year can ask their employer for a P38(S) which
they should complete and return to the employer at the start of
their job. A P45 is given out at the end of a job and shows the
pay received and tax deducted between the start of the tax year (6
April) and the date the employment ceased (if before 5 April the
following year). The P60 summarises the yearly earnings and tax
paid for a particular job. Students with more than one job at the
5 April each year will receive a P60 from each employer. The P45
and P60 forms should be kept in a safe place for future reference.
· What does my tax code mean?
Your tax code shows how much you are allowed to earn before
paying any tax.This helps employers to work out how much tax
to deduct from your pay.
· What if I have more than one job?
Like everyone else, students have only one Personal Allowance for
each tax year and if they start a new job without finishing their
first job, their second employer will ask them to fill out and
sign a form P46. The employer uses the information on the P46 to
notify HMRC that a new employee has started and to ensure the
correct code is operated on earnings from the second job.
· What are National Insurance c ontributions (NICs)?
NICs pay for social security benefits that you may receive later
in your life and help pay for the National Health Service.
National Insurance contributions are recorded against a person’s
name using a National Insurance Number. NICs are deducted at
source from pay by employers and cannot be claimed back. They are
only paid once your income exceeds £110 a week. You’ll need to
keep a record of your National Insurance Number for any dealings
with their tax office and their employer(s).
· Who do I need to tell when I change address?
HMRC needs to be kept informed of your address. This is the
individual’s responsibility – don’t assume your college or
university will do it - and ensures you won’t miss any important
letters or forms – or rebates!
2. About the Student Tax
advice campaign
A website for the campaign aims to become the first port of call
for students with questions about tax:
www.direct.gov.uk/studenttaxadvice .
3. HMRC have launched the ‘Universilly Challenge’ tax fact
application on the social networking site Facebook. The
application contains a variety of tax related information in the
form a light hearted quiz. A league table shows the top ten
results for the quiz.
4. Latest student numbers published in January 2009 by DIUS and
HESA: http://www.dcsf.gov.uk/rsgateway/DB/SFR/s000829/index.shtml
Contacts:
HMRC Out of Hours
Phone: 07860 359544
NDS.HMRC@coi.gsi.gov.uk
Andrew Bennett
Phone: 020 7147 0051
andrew.bennett3@hmrc.gsi.gov.uk
Madonna Grant
Phone: 020 7147 2331
madonna.grant@hmrc.gsi.gov.uk