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What happens when international students leave the UK?

Updated on 6 April 2023

Migrants

There are a number of tax matters you need to consider when leaving the UK after studying here. These include the possibility of obtaining a tax refund and how you repay any student loan you may have when you are abroad. 

Illustration of the Union Jack, a passport and visa application

Can I get an income tax repayment when I leave the UK?

Many international students fail to claim a repayment of tax to which they are entitled when leaving the UK, for example, when returning home when they have finished their studies.

Many students who work in the UK do so for only part of the year or they work part-time in several jobs. When this happens, the UK Pay as You Earn (PAYE) system may not deduct the right amount of tax and often deducts too much.

Shortly before you leave the UK after studying here, you should complete a form P85 ‘Leaving the UK – getting your tax right’. This form tells HM Revenue & Customs (HMRC) that you are leaving the UK and makes a claim for repayment of any overpaid tax for the year of departure.

If you have a form P45 from a former employer, you should send parts 2 and 3 to HMRC together with form P85.

If you have overpaid tax and claim a repayment, HMRC will send you any tax refund that they owe you, but they will need your up-to-date address or a UK bank account to which they can make a direct transfer. Any repayment will be made in UK currency so make sure your bank account will accept the funds.

You may have overpaid taxes in more than one tax year during your stay in the UK. You can tell HMRC about this when you submit form P85 and ask HMRC to repay you for all the tax years involved. However, there are time limits on when you can claim a tax refund.

You should beware of various companies (often advertising online) which offer to claim back overpaid tax for taxpayers – many are not reputable, and others may charge high fees for a service that you can easily do for yourself. There is more information on these companies in our tax refund section.

Can I get a refund of National Insurance contributions (NIC) paid in the UK?

It is not usually possible to get a refund of NIC, but it might be possible to have them taken into account when determining eligibility for state benefits in another country.

If you are returning to a country within the EEA, you will need to determine whether you can ‘aggregate’ periods of contributions in this way under the terms of the UK’s withdrawal agreement from the European Union, or otherwise under the new UK-EU protocol for social security coordination. There is more information on this at How does the UK state pension work for migrants?, though we recommend you seek advice based on your personal circumstances.

Alternatively, you may be able to take periods of contributions into account for determining benefit eligibility if you are returning to a country that has a social security agreement with the UK.

Visit Do international students pay National Insurance contributions? for more information.

Can I get a VAT refund?

Please see Can I claim a VAT refund if I leave the UK?.

What happens to my student loan repayments if I leave the UK?

In 1998, the UK introduced income-based or income-contingent loans. The main way of repaying these loans is via the UK tax system. Borrowers have to deal with both the Student Loans Company (SLC) and HM Revenue and Customs (HMRC) when they start paying back what they owe.

Students who are eligible to take out a UK student loan have to make repayments through the UK tax system, in the same way as any other UK student borrower.

Students who go abroad can no longer make loan repayments via the UK tax system. This means that if you received a UK student loan and you leave the UK for more than three months after finishing your course you must inform the SLC. The SLC will take over the collection of the repayments.

It is important for students to take note of the repayment threshold relevant to the country to which they are going, as it is not necessarily the same as the UK thresholds. Thresholds vary according to comparison calculations between the cost of living in the UK and the other country.

You can find more information on GOV.UK.

What happens to my student loan repayments if I return to the UK after living abroad?

Similarly, if you have been living abroad and return to the UK for three months or more, you should let the SLC know. This is important because if you find employment in the UK, you might need to start making repayments via the UK tax system again and you will need to cancel any separate arrangements that you have made with the SLC.

Tax guides

Introduction to the tax system How do I work out my tax? What income is taxable? What tax allowances am I entitled to? What tax rates apply to me? How is my tax collected? What if I cannot pay my tax bill? Do I need to complete a tax return? Self Assessment: understanding the basics What is Simple Assessment? How do I claim tax back? How do I claim back tax I have overpaid through PAYE on wages or pensions? How do I claim back tax if I complete a tax return? How do I claim back tax if I am taxed under the Construction Industry Scheme (CIS)? How do I claim back tax on savings income? How do I claim a marriage allowance refund? How do I claim back tax on a payment protection insurance (PPI) pay-out? Should I use a tax refund company? What is National Insurance? How do I get a National Insurance number? What are Specified Adult Childcare credits? What is Scottish income tax? What is devolution? Do I have to pay Scottish income tax? How does Scottish income tax work? What is Welsh income tax? Do I have to pay Welsh income tax? Do I have to join a pension scheme? Tax relief on your pension contributions HMRC digital services Enquiries, penalties, appeals, complaints and debt Enquiries How to survive an enquiry by HMRC Tax penalties Tax appeals Alternative Dispute Resolution How do I complain to HMRC? What if I cannot pay my tax bill? What if I have a tax credits overpayment?
Am I employed, self-employed, both or neither? Working through a limited company What is the national minimum wage? How do I work out my tax? What income is taxable? What tax allowances am I entitled to? What tax rates apply to me? How is my tax collected? How is tax collected on taxable state benefits? How do I check my coding notice? Do I need to complete a tax return? What tax do I pay on redundancy payments?Employment benefits and expenses What are benefits-in-kind? What payments and benefits are non taxable? What if I incur expenses in relation to my job? What travel expenses can I claim? What if I use my own car for business purposes? Payroll giving Allowances and expenses paid to armed forces personnel and deductions from their income Pensions and employees What is automatic enrolment for employees? What National Insurance do I pay as an employee? How do I repay my student loan? What if I do not pay enough tax? What if I pay too much tax? What if I work abroad temporarily? What if I am in the armed forces and work overseas? First time workers Apprenticeships

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