Student Finances and Council Tax

Council Tax
Council tax is a property tax. How much you pay is based on where you live i.e. in which borough, the value of your home and who lives in it. As a student, you may be exempt or pay less tax depending on your situation.

Students in a full-time course and attend classes 21 hours a week for a minimum of 24 weeks a year may normally are exempt, as are students who are under 20 years old, and studying a course not above A levels, ONC or OND. But don't forget to get a certificate from your university/college proving that you are a full-time student; you could be asked to forward this on to your local council.

If you live with someone who is not a student, you may still be able to get a single-person discount of about 25%. However, you may not have to pay any council tax at if you live in halls of residence (as long as there are only students living there), or if you live in a private flat where everyone is studying full time. To ensure that you don't overpay your taxes or your landlord, contact your local council for the low-down your situation.

National Insurance
Students who work and earn more than £87 per week will, unfortunately, be required pay National Insurance, as do post-graduate students who are teaching.

As soon as you start work your employer should ask for your National Insurance Number. This number gives an employer/tax office a unique identification of yourself. It looks like this: AB 12 75 79 C

If you do not have a number you will need to contact your local National Insurance office and complete the necessary forms.

UK students: You will have been allocated a NI number from the age of 16. If you have lost it then contact the NI Office and they will be able to trace your number for you.

International students: You will not have a NI number. To obtain a NI number you will need an offer of employment, then you will need to contact your local Jobcentre Plus Office.

The government collects National Insurance to help pay for Jobseeker's Allowance, Incapacity Benefits and your Retirement Pension if and when you require them. Your contributions are deducted from your pay, through your employer. However, if you are under 16 or do not work and are a full-time student, then you will not have to contribute to NI.

Income Tax
Income tax is the money the government collects, well, for itself. The more you earn at your job, the more you will have to pay. The tax year in Britain runs from 6 April to April 5 the following year and you will have to pay your taxes towards the end of January each year.

But if you earn less than £6,475 a year (the tax-free personal threshold for 2009/10), you won't be required to pay any tax at all. To qualify (and only if you're doing the work during the summer holidays), ask your employer for a P38 form. If you have earned less than the threshold and find you still have inadvertently been paying taxes, you can always reclaim it back from Inland Revenue by asking for a tax rebate form at the end of the year.

For all student Income Tax and National Insurance questions, please visit the Inland Revenue website.

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