Repaying Student Loans 2009/10 guide discussion

Poolie

sghughes42 wrote: »

My girlfriend has an outstanding Student Loan from the 90s. She's recently started her first well-paid job since graduating. She has just got her February pay-slip and has noticed that a Student Loan deduction has been made from it. She's confused as to why this has happened - can anyone explain based on the following circumstances:

Started Uni in 1994, completing a BA in 1997 and going on to complete an MSc the following year. She took loans out for all the years she was at uni. However, the Student Loan article on here suggests she should only have payments taken direct for loans from 1998 onwards.

She did study towards a B. Nurs. from 2003 but didn't complete the course and took no loans out during this period. She did get a bursary however.

From what we can tell she falls in to the pre-98 course start date for the loans and isn't over the £25k threshold for repaying those loans anyway. She holds a current deferment for the loans she does have.

Does the fact she started a course after 98 mean the way she repays her loans has been changed, even though she didn't take a loan out during that course?

Have the rules changed for pre-98 loans?

Or has someone in Payroll / SLC made a muck-up?

And what should she do about it?

As she is pre 1998 loans then they should not be deducted from her salary.

Did you change jobs recently or completed a P46? If so, did she tick the box saying she had a student loan?

She needs to first ask her payroll department if they recevied a SL1 (Start Notification) for her national insurance number.

Also contact SLC and ask them to check against her National Insurance number in the system and check they have the correct details as may be somebody has given the wrong NI number and it has been confused.

If she is not due to pay via her salary, SLC will need to contact for them to contact HMRC so they can tell her employer so refund the amount back to her salary. They can still do the refund as it is within this tax year (just).

anglaise

Does anyone know how the overseas threshold equivalents are worked out for pre 1998 loans please?
From the SLC website
"If you are:
living overseas;
have Fixed Term Loans (loans taken out before 1998); and
are earning over the equivalent of the annual threshold of £27,050 in
the country where you live;you will be expected to make your monthly
repayments to us."

Is the equivalent of £27,050 (£2254 per month) in euros worked out on today's exchange rate, or yesterday's or an average of the last 3 months or the last year or some other figure????
Thanks for your help.

Poolie

anglaise wrote: »

Does anyone know how the overseas threshold equivalents are worked out for pre 1998 loans please?
From the SLC website
"If you are:
living overseas;
have Fixed Term Loans (loans taken out before 1998); and
are earning over the equivalent of the annual threshold of £27,050 in
the country where you live;you will be expected to make your monthly
repayments to us."

Is the equivalent of £27,050 (£2254 per month) in euros worked out on today's exchange rate, or yesterday's or an average of the last 3 months or the last year or some other figure????
Thanks for your help.

SLC use live exchange rates from xe.com to perform any currency calcuations.

anglaise

For my student loan deferment I need to declare my rental income on a house that I let out jointly with my husband. Are we obliged to share the rental income 50/50 or can he have more of it than me so that I'm not over the limit!
Thanks for your help.

Oldernotwiser

anglaise wrote: »

For my student loan deferment I need to declare my rental income on a house that I let out jointly with my husband. Are we obliged to share the rental income 50/50 or can he have more of it than me so that I'm not over the limit!
Thanks for your help.

Do you own it 50/50?

sghughes42

Poolie wrote: »

As she is pre 1998 loans then they should not be deducted from her salary.

Did you change jobs recently or completed a P46? If so, did she tick the box saying she had a student loan?....

Thanks for the reply. It seems there is more to this than I first realised. We've checked her SL paperwork and she does actually have a loan from the nursing course she did from 2003-2006. She claims she didn't apply for this and didn't want or need one as she was getting a grant. I've pointed out that she should have noticed £2.5k going in to her account and the numbers on the paperwork....

We are looking in to the grant paperwork to see if the loan was somehow included on here - she certainly didn't apply for one separately from the grant so all we can think is that it was all on the same form and she just didn't realise. (Unless the grant became a loan when she didn't complete the course)

Either way it seems the deductions are correct - whether she reclaims them or not is a decision for the end of the tax year as it's only a few quid whenever she works overtime so maybe not worth the trouble. (Not MSE thinking I know!)

anglaise

Oldernotwiser wrote: »

Do you own it 50/50?

Yes we are joint owners so I suppose that is 50/50!

andyhe

Hi all

I recently received my annual statement (for Apr 08-Apr 09) for my post-98 loan and I reckon I'll repay the loan in full in the next year or so. Along with the statement, there was a letter confirming I was nearing repayment completion and suggesting that I change to a direct debit to avoid overpaying.

So, can anyone answer some of my questions:

1. Is there any advantage to changing to a direct debit? I don't believe there's any tax advantage repaying via PAYE, so I assume paying by direct debit will just avoid overpaying.
2. If I do overpay, can I get it back? The letter doesn't actually mention that you can get back the extra cash, but the website hints you can. I suspect it could be time consuming/difficult etc.
3. Can I prolong the repayment period by paying by direct debit (especially as the Interest rate is currently 0%)? DD repayments would apparently be "calculated based on recent Student Loan repayments (they) have received" - I assume this would be from FY 08/09 rather than 09/10? This might be significant as my salary has increased in the last few months and hence my repayments would be higher if I continue to repay via PAYE, and would hence pay off the loan quicker than necessary.

I'm not fussed about paying off the loan as quickly as possible - just cheaply as possible!

Any suggestions or comments welcome. Thanks in advance,

Andy

Poolie

1 - If you move onto the Direct Debit then your payments will be stopped via PAYE and you will complete the payments via Direct Debit.

2 - You can get any overpayments back, if you move on to the Direct Debit this won't happen but may happen on PAYE system.

3 - The direct debit will be set to complete payments over the next 12 months only. You would need to phone SLC will details of payments you have already made during the 09/10 tax year as they don't have this information.

The other option is to leave the payments via PAYE and ask them to do a predictor. Basically they take the information from your payslips for the current tax year (09/10) and apply these to the system. They then predict based on your salary staying the same (at the current monthly repayments) to work out when you would complete repayments. The system will then issue the stop notification to HMRC at the correct time for it to be actioned by your employer at the correct time.

This is one of the easiest methods as long as your salary is not going to increase over the next few months.

You might be best to call SLC and give them the latest tax years repayments and ask for a current balance (can be done as long as you give them the information). This way you can work out roughly when your repayments may complete. They will be able to use the predictor accurately as well.

Weluvdarling

Hi, can someone help me with a question please.

If I have rental income but no rental profit (because of rental expenses), does the income still need to go on the pre 1998 student loans deferment form ? The guidance notes are not very clear on this.

It seems inconsistent that for pre-1998 loans, rentals are assessed for loan repayments, but new loans where 9% of net earnings are re-paid to student loans company that only rental profit would be considered ?

Any ideas anyone ?