As a student the most important thing to know is that you are eligible to not pay tax when you meet certain conditions. The main idea is that up to a certain point you do not have to pay taxes on your income. To be more specific, if you earn anything above your Personal Allowance, which in 2015 is £10,600, then you will only pay taxes on the difference over this amount.
If you have a job, your employer deducts tax and National Insurance before paying you via a scheme called Pay as You Earn (PAYE). You pay taxes based on your tax code so make sure you have the right one as otherwise you may be overpaying, in which case you would have to contact HMRC.
If you are an international student with the right to work in UK, then you would also have to abide by the tax rules. Moreover, you will also have the same rights as UK students when it comes to over-paid tax. In addition, if your income is earned overseas or online, you are also subject to paying taxes.
It is worth bearing in mind that you pay tax on more forms of income including your salary and any interest earned. This is why banks offer a specific type of bank account to UK residents, called ISA, which you can think of as the “cloak of invisibility” for your cash. Interest earnings on money kept in ISAs (Individual Savings Accounts) are not subject to taxes so if you are interested in saving money, such an account is the most suitable for you.
If you are wondering if there is any other reason which should make you interested in this tax stuff then here it is: student loan repayments. The threshold for repayments go by taxable income which means that it would be good to know when you have paid too much or too little of your student loan.
All you Need to Know about Tax
