Full time student: Summer Placement -Should I be paying tax?
Discussion
Hi,
I have reciently started working for a company to give me some experience in industry over the summer.
Before June, I worked for Tesco part-time and was in full-time university education. I did not pay any tax or N.I. I now work 37hours per week for a company, and was taxed on my first pay for June. Should I be being tax at all currently? I am still well below the threshold limit (as far as i recall it is now £5300) for tax.
Thanks,
Agar
I have reciently started working for a company to give me some experience in industry over the summer.
Before June, I worked for Tesco part-time and was in full-time university education. I did not pay any tax or N.I. I now work 37hours per week for a company, and was taxed on my first pay for June. Should I be being tax at all currently? I am still well below the threshold limit (as far as i recall it is now £5300) for tax.
Thanks,
Agar
They will tax you as if you will be working for the full year, so when your placement finishes you have to claim back your over payment from The Man.
It was 15yrs since I was in a similar position so I've forgotten how you actually go about claiming it back. Someone else will surely know.
It was 15yrs since I was in a similar position so I've forgotten how you actually go about claiming it back. Someone else will surely know.
You'll get a right shock because if they put you on PAYE you'll run over your tax allowance which basically means the day you run over your tax free allowance they will calculate your total tax due divided over 12 months, and take the months owed off your wage by PAYE. In other words one month you'll work but won't be payed.
They you'll have to wait until April to get it back.
They you'll have to wait until April to get it back.
Indeed. You will be taxed as if you are working a full year, and earning an annual salary. If you work only part of that year, you can only (IIRC) claim back retrospectively.
This happened to me too back in the day - cannot remember what it was called (P-something, obviously), but there is a form you can fill out to claim the tax back before the end of the fiscal year - so if you finish in September lets say, you can claim the tax back that you have over-paid then as opposed to having to wait till the following April and your P60.
Careful though - if you then work between September and April as in the above example, and you have already claimed back your tax, you'll end up owing money to The Man.
This happened to me too back in the day - cannot remember what it was called (P-something, obviously), but there is a form you can fill out to claim the tax back before the end of the fiscal year - so if you finish in September lets say, you can claim the tax back that you have over-paid then as opposed to having to wait till the following April and your P60.
Careful though - if you then work between September and April as in the above example, and you have already claimed back your tax, you'll end up owing money to The Man.
If you will only be working over the summer break and your total earnings will be less than £5,435, it may be possible to complete a P38(S) which will allow your earnings to be paid without the deduction of tax. You will still have to pay NI though if you are above the threshold. Not all employers are willing to operate a P38(S) though.
If your employer does not want to use the P38(S), you can reclaim your tax by completing a P50 and sending this to HMRC after you stop working. If you will not work again before 5 April 2009, you can claim the repayment based on the full years allowances. If you intend working at Chritsmas for example, you can claim after not working for 4 weeks. You receive a proportion of the allowances and are issued with a replacement P45.
If your employer does not want to use the P38(S), you can reclaim your tax by completing a P50 and sending this to HMRC after you stop working. If you will not work again before 5 April 2009, you can claim the repayment based on the full years allowances. If you intend working at Chritsmas for example, you can claim after not working for 4 weeks. You receive a proportion of the allowances and are issued with a replacement P45.
Brown and Boris said:
See the post on summer salary. HMRC have a special scheme that allows employers not to deduct tax and Ni if you are a students expected to earn under the tax/NI limit this tax year.
Last time I looked, the form was for those who had no other employment apart from holidays, and expected to earn under the threshold.AGAR said:
Fantastic guys. I should have mentioned I will be back working part-time over the weekends from Sept onwards, and thus will be going over my threshold limit for the year but not until Jan-Feb.
How does this fix me in terms of what i can claim back now?
Thanks
The P38(S) will not be suiatble for you then. When you leave your summer job, you will be given a P45. You will need to give this to your part-time employer and when you are paid each month you will get a tax repayment based on any unused allowances.How does this fix me in terms of what i can claim back now?
Thanks
944gav said:
AGAR said:
Fantastic guys. I should have mentioned I will be back working part-time over the weekends from Sept onwards, and thus will be going over my threshold limit for the year but not until Jan-Feb.
How does this fix me in terms of what i can claim back now?
Thanks
The P38(S) will not be suiatble for you then. When you leave your summer job, you will be given a P45. You will need to give this to your part-time employer and when you are paid each month you will get a tax repayment based on any unused allowances.How does this fix me in terms of what i can claim back now?
Thanks
Many thanks for your advice.
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