HM Revenue & Customs has sent out the reminder in advance of the holiday season when many undergraduates look for temporary work.
Many people are unaware that if they earn less than £7,475 in a tax year they do not have to pay income tax.
Stephen Banyard, director general of personal tax at HMRC said: "We don’t want students to pay tax when they don’t owe any, so we’re encouraging them to fill in a P38(S) and send it back to us. That way they can keep all the money they’re earning for student life’s essentials.”
Students must fill out a P38(S) which needs to be sent to HMRC to ensure they are tax-exempt. Employers and students can download the form at www.hmrc.gov.uk/forms/p38s.pdf