Loughborough University
Leicestershire, UK
LE11 3TU
+44 (0)1509 263171
Loughborough University

Student Advice and Support Service

Working during your studies

If you have a job you may need to pay Income Tax and National Insurance.

If you’re an employee, depending on how much you earn, income tax and national insurance may be deducted from your salary before you are paid.

Students are not exempt from paying tax and national insurance.

More detailed information is provided in the Tax Guide for Students.

Income Tax

Income tax is a tax you pay on your income. Most people have a personal allowance of tax-free income. This is the amount of income which can be earned before having to pay tax. The standard tax-free allowances change each tax year (6 April to 5 April the following year); the gov.uk website has more information.   

Your employer uses a tax code to work out how much income tax to take from your pay. You can find this on your payslips.

Your tax code will be made up of:

  • Numbers – these refer to how much income you can have before you pay tax
  • Usually one letter – this refers to your situation

It is important that you check your tax code to ensure that you are not paying too much tax. If your tax code has a ‘W1’, ‘M1’ or ‘X’ at the end this is an emergency tax code. This means that your tax is based on what you have paid in the current pay period rather than over the whole the tax year. If your tax code is ‘OT’, this is a temporary tax code that means you don’t get any personal allowance until it is updated.

Income tax if you have more than one part time job

The tax system treats one job as your main employment and will apply your personal allowance to that job.

If you have a second job, you could end up paying too little tax…

  • if HMRC doesn’t know you have two jobs and is applying your personal allowance to both
  • if what you earn from both your jobs makes you a higher-rate tax payer, but tax is deducted from your second job at the basic rate

Paying too little tax could result in you getting a big tax bill later on and being charged interest and penalties.

Alternatively, you could end up paying too much tax if the income from both your jobs adds up to less than your personal allowance.

If this is the case, you can ask HMRC to divide your allowance between your jobs or ask for a refund at the end of the tax year. You’ll need to send copies of P60s from your jobs to do this. Your employers will give you a P60 at the end of the tax year.

To avoid tax underpayments or overpayments, you need to:

  • make sure HMRC knows you have more than one job (when you start your second job, complete HMRC’s new starter checklist from your new employer. This should help HMRC allocate the right tax code).
  • check your tax codes for both your jobs to make sure they are correct – if you have more than one job, you’ll have more than one tax code.

You can notify HMRC of additional jobs, incorrect tax codes and update your contact details through your Personal Tax Account on the gov.uk website. You can also contact HMRC by calling 0300 200 3300.

National Insurance

National Insurance contributions are payable on your earnings and help to build up your entitlement to certain state benefits, such as the State Pension.  You cannot opt-out, even if you may never claim these benefits – all employees must pay National Insurance on their earnings above a threshold level.  More details are on the gov.uk web pages.

You should obtain a National Insurance Number (NINO) to ensure that your tax and national insurance contributions are correctly recorded against your name.

Applying for a National Insurance number (NINO)

You can only apply for a NINO once you are in the UK and you must have the right to work or study here to get one.

To apply for a NINO you will need to call the Jobcentre Plus on 0800 141 2075 (Mon to Fri 8am to 6pm).

You can apply either before or after you get a job. You should tell your employer that you’ve applied for a number and give it to them when you have it.

Jobcentre Plus may ask you to come to an interview where you’ll be asked various questions about why you need a national insurance number, and what your immigration status is. Before your application, the Job Centre will send you a letter confirming your appointment time and what documents they will expect you to bring. This could include:

  • Birth Certificate
  • Marriage Certificate
  • Payslips
  • A work permit
  • A letter from your employer
  • Your contract of employment
  • Details of any employment agencies you are registered with
  • Any rejection letters you have received from job applications
  • A letter proving your student status from the University
  • Utility bills or bank statement showing your current address.

You must also bring any travel documents you have. These are documents that give information about your travel between countries. Travel documents include things like your passport, National Identity card or form NASS35 that is issued to people seeking asylum in the UK.

This is not an exhaustive list and the Job Centre will discuss alternatives with you if you cannot supply any of those listed above.

If you have any other documents that you think may help prove your identity, take them with you. If you do not have any documents you must still go to the interview. If you fail to turn up for the interview you will have to start the process again and will be regarded as low priority.