We would like to remind students that work part time, for example in a summer job, that they are entitled to claim back any tax overpaid. Students (and other temporary workers) are not required to pay any Income Tax if their earnings are below the tax-free personal allowance, currently £12,500.
However, employers are required to calculate the amount of tax you need to pay on the basis that you would be working for the rest of the tax year. This means that an over-payment of Income Tax can often occur where a student or temporary worker earns more than their monthly allowance of £1,042 (£12,500 / 12), but over the course of the tax year earn less than their annual allowance. For example, a student only working over the summer and earning more than £1,042 a month is unlikely to have exceeded the current £12,500 tax free personal allowance.
Students that expect to earn less than £12,500 in the current tax year (i.e. to 5 April 2021) can complete a HMRC P50 form entitled Claim for repayment of tax when they have stopped working. A refund of overpaid tax can be requested using an online version of the P50 form. The P50 form can only be used if you are not going to work for at least the next 4 weeks and are not claiming certain state benefits.
Any students that are continuing to work for the rest of the tax year in part-time jobs should consider waiting until the end of the tax year in order to make a claim.