Is Your PhD Stipend or Funding Taxable?
Frequently Asked Questions
Most UKRI (Research Council) PhD stipends are tax-exempt under scholarship income provisions (ITEPA 2003 s776). This includes AHRC, BBSRC, EPSRC, ESRC, MRC, NERC, and STFC studentships.
No. The exemption applies to genuine scholarships. Industrial CASE studentships with significant company involvement may be partially taxable. Payments in return for services (demonstrating, tutoring) are always taxable.
The minimum UKRI PhD stipend for 2025/26 is £19,237 (increased annually with inflation). Individual universities or research councils may offer higher rates.
If your only income is an exempt PhD stipend, you don't need to file self-assessment. If you have additional taxable income above the personal allowance, you may need to register.
Yes. Any income paid in return for services — teaching, demonstrating, supervision, marking — is employment income subject to PAYE. Your university will operate payroll on this and issue a P60.
Full-time students (including PhD students) are exempt from council tax if all residents are full-time students. Once you submit your thesis and end full-time student status, liability may begin.
Tax-exempt scholarship income (e.g., UKRI stipend) is generally not counted as income for Universal Credit purposes. Employment income (demonstrating pay) is counted.
No. Tax-exempt scholarship income is not 'earned income' or even 'taxable income' for most purposes. It doesn't affect your personal savings allowance or income tax calculations.
You can contribute to a personal pension (SIPP), but HMRC only allows tax relief on contributions up to your UK earnings (employment income). Since an exempt stipend is not earnings, contributions based solely on stipend income won't attract basic rate top-up.
Student loan repayments are calculated on income above the threshold. If your stipend is exempt and you have no other income, there may be no repayment due. Check your specific loan terms.
Common in teaching-heavy positions. The stipend portion may be exempt; the employment salary is always taxable. Ensure your university correctly designates each payment.
The s776 scholarship exemption applies to scholarships received by individuals attending full-time education at a UK university, regardless of nationality. Overseas students are subject to the same rules.