How to obtain a tax refund

ICAEW advice for students and other PAYE taxpayers


Many students work during the summer holidays, but may not realise that they could end up overpaying tax. Here is some advice from ICAEW on how to obtain a tax refund, for students and others taxed under PAYE and not in self assessment.


The way the tax system applies to students who work while studying has changed over the years. Members may recall the now-defunct form P38S. There are now no special PAYE regulations for students, who should be treated like any other employee for PAYE purposes. For those who are digitally enabled, the personal tax account is now the best way to claim refunds where the PAYE system results in too much tax being deducted.


HMRC explains in Claim a Tax Refund which form is appropriate for those who need to claim a refund and do not complete self assessment tax returns.


The P50 is the form to be used when someone stops work and does not intend to work for the remainder of the tax year. But note that a refund cannot be claimed when someone moves from employment to claim a taxable state benefit other than in some limited circumstances through JobCentre Plus.


Choosing the correct form can be tricky for those who receive a pension or take a lump sum: there are five possible forms – P50, P50Z, P53, P53Z, P55 – to choose from, depending on the precise circumstances.


Those with ongoing PAYE sources of income generally need to wait until the tax year is complete before claiming a refund (in some circumstances a refund is obtained through the application of a revised tax code). HMRC is currently carrying out its automatic PAYE end of year reconciliation process for 2015/16 and issuing refunds and P800 calculations – see our news items HMRC has started the 2015/16 PAYE reconciliations and Changes to P800 end of year reconciliation process.


There are other circumstances not covered in HMRC’s Claim a Tax Refund in which taxpayers apply for refunds. For example:

  • Those applying for a refund when they leave the UK to live abroad complete a form P85.
  • Those who wish to claim job-related expenses complete a form P87 which may lead to a refund being due.
  • Tax deducted from savings and investment income is reclaimed via a form R40 – these will be less of a feature of the tax system from 2016/17 as most interest will not suffer deduction of tax at source.


None of the forms mentioned above are relevant to those who complete self assessment tax returns though the detail does demonstrate how the system is far from simple for those not required to complete tax returns. All of the forms are now available through the personal tax account, but paper versions are also available.