Repaying Student Loans 2009/10 guide discussion

LJW_2

So is it not true that if you leave the country for 6 months you don't have to pay all of your student loans back. Not that I'm planning to do that, I graduated years ago but have recently heard this, can't be true! can it??

Oldernotwiser

LJW wrote: »

So is it not true that if you leave the country for 6 months you don't have to pay all of your student loans back. Not that I'm planning to do that, I graduated years ago but have recently heard this, can't be true! can it??

Complete rubbish I'm afraid. You even have to pay back your loan whilst you're abroad if you're over the threshold.

Keep_The_Change

Ok, here's my query if anyone can help? thanks. I've posted this in another thread too, if I'm not allowed to do that, mods, please merge my replies together.

-I took out a student loan in 1999/2000.
-Graduated in 2002.
-Have paid bits of it back on and off through the years automatically through emplyment / ductions through monthly wage.
I am currently in full time emplyment.

I currently owe SLC approx £10,800 as of this month.

HOWEVER, I am in the position at the moment to be able pay off the above amount in ONE LUMP SUMP. I have the required amaount.

I have NO other loans to pay off.
I have NO debts, over drafts, CC bills, credits etc, nothing.
I do NOT have a mortgage to pay at the moment.

Should I pay it off?

I am aware that I can put the funds into a high interest account and make some money from it, but I do not wish to do that.
I want to clear this loan off so I am totally debt free.

Is there any DISADVANTAGES to me paying it off in one lump sum?

And if I do pay it off, how does it work?
Do the SLC inform the Inland Revenue and then the IR stop taking deductions from my salary? Or do I need to tell the payroll office of my employer directly, or contact IR myself?

Thanks!

Oldernotwiser

Keep_The_Change wrote: »

Ok, here's my query if anyone can help? thanks. I've posted this in another thread too, if I'm not allowed to do that, mods, please merge my replies together.

-I took out a student loan in 1999/2000.
-Graduated in 2002.
-Have paid bits of it back on and off through the years automatically through emplyment / ductions through monthly wage.
I am currently in full time emplyment.

I currently owe SLC approx £10,800 as of this month.

HOWEVER, I am in the position at the moment to be able pay off the above amount in ONE LUMP SUMP. I have the required amaount.

I have NO other loans to pay off.
I have NO debts, over drafts, CC bills, credits etc, nothing.
I do NOT have a mortgage to pay at the moment.

Should I pay it off?

I am aware that I can put the funds into a high interest account and make some money from it, but I do not wish to do that.
I want to clear this loan off so I am totally debt free.

Is there any DISADVANTAGES to me paying it off in one lump sum?

And if I do pay it off, how does it work?
Do the SLC inform the Inland Revenue and then the IR stop taking deductions from my salary? Or do I need to tell the payroll office of my employer directly, or contact IR myself?

Thanks!

Is the reason you have no mortgage at the moment because you already own a mortgage free property or because you haven't yet bought somewhere? If the latter, do you already have a deposit saved and is it of the size that will enable you to get a mortgage at advantageous rates? Is your job secure or are you at any risk of redundancy?

These are some of the questions you might like to consider before making this decision.

Poolie

If you are wanting to make a one off payment you are best to call student loans. Make sure you have your last P60 (in case they don't have a record) and your payslips since April. They should be able to put the information into the system and they will give you an amount that they would expect you to pay to clear the loan (ie usually dated 2 weeks in advance - won't make much difference since interest rate is 0% at present on post 1998 loans). You could then put a cheque in the post, pay it by bacs (ask for the details) or debit card over the phone.

It is really a decision you have to make based on how much comes out of your salary each month and how quickly you would be able to resave the amount. Also take into account if you need to access these funds quickly. Once it has been paid yes you will be free but you won't be able to get the cash back.

oldbstrd

Hi, I have a works pension of £17,000 per yr i'm 52yrs of age do you think I would have to pay any of my student loan back

Poolie wrote: »

We would require more information on the loan you have. When did you originally take it out?

It also depends if the pension is classed as taxable income by HMRC. If so then you may be expected to repay some loan. Also Pensions usually don't pay £15,000 per annum.

davidm1984

I started my own limited company in september and currently take home £110 a week directors fee and about £500 in dividends. I pay corporation tax but no National Insurance. I was wondering if i have to make any repayments to my student loan or are the dividends not included?
I have had different answers from my accountant and the student loans company one says yes, the other says no because my £110 dirctors fee is my only real wage.
Please help.

Poolie

oldbstrd wrote: »

Hi, I have a works pension of £17,000 per yr i'm 52yrs of age do you think I would have to pay any of my student loan back

Do you have any other income which is paid by PAYE or for which you complete as Self Assessment return?

Have SLC been in contact regarding how you are currently supporting yourself? If not, you may receive a letter as they update their records monthly and ask for confirmation.

Poolie

davidm1984 wrote: »

I started my own limited company in september and currently take home £110 a week directors fee and about £500 in dividends. I pay corporation tax but no National Insurance. I was wondering if i have to make any repayments to my student loan or are the dividends not included?
I have had different answers from my accountant and the student loans company one says yes, the other says no because my £110 dirctors fee is my only real wage.
Please help.

You should be completing a Self Assessment return from April 2010 for the current tax year. On this return you will need to declare all income (fess and dividends). There is a box on the main returns which asks if you had a student loan post 1998. Failure to tick the box can land you with a revised tax bll and a posisble fine.

HMRC will calculate your Student Loan repayments along with your other tax libabilities for the tax year 2009/2010.

dubsdj

I have 18500 pound student loan. I repay about 50 pounds a month but by the end of the year I notice the interest of the loan is more than my repayments and it goes up by another 100 pounds every year!! I'm really worried because I can't really afford to pay anymore back than what the government takes... What should I do??

I got my first student loan payment around 2000 - 2001