Salary Sacrifice and Student Loan Repayment Threshold

united4ever

My company will introduce a salary sacrifice scheme soon. I have been deferring my student loan repayments sor over 10 years now - my salary always falls just under the threshold. This time I think I'm finally going to have a salary over the repayment threshold.

If I opt into the salary sacrifice scheme then this would take my salary back under the threshold. I'm planning on entering the salary sacrifice scheme anyway so can anyone confirm if the salary sacrifice is considered when the SL company ask for your gross salary to determine whether or not you are under or over the repayment threshold. Thanks in advance:)

Eavestile

I can't give you the confirmation you seek (and am surprised no-one else can) but my guess is that it may depend on exactly what kind of salary sacrifice your company has in mind. The rules, for example, for pension payments may be different from those for child care vouchers. If you can give a bit more detail others with better knowledge than I may be able to help you.

JOHNGT

Your reduced salary after the sacrifice is your gross salary. Your company may still show a 'notional' salary for calculation of the pension contribution and other benefits, but the difference between your new reduced gross and the notional is not real income and is not taxable.

united4ever

Thanks for your help, the finer details of the new salary sacrifice scheme are being sorted out. The application for deferment of SL needs sending back today really. I think I will have to start making repayments and then once the salary sacrifice kicks in and I have 3 pay slips I can send them as evidence I should be able to defer.

It is child benefit and child tax credits which have tipped me over the threshold....I believe these do count as part of gross income right?

DonTrev

united4ever wrote: »

Thanks for your help, the finer details of the new salary sacrifice scheme are being sorted out. The application for deferment of SL needs sending back today really. I think I will have to start making repayments and then once the salary sacrifice kicks in and I have 3 pay slips I can send them as evidence I should be able to defer.

It is child benefit and child tax credits which have tipped me over the threshold....I believe these do count as part of gross income right?

Hi,

Any update to this? Think I'm in a similar situation assuming yours is the old mortgage style loan?

Thanks

nad1611

united4ever wrote: »

Thanks for your help, the finer details of the new salary sacrifice scheme are being sorted out. The application for deferment of SL needs sending back today really. I think I will have to start making repayments and then once the salary sacrifice kicks in and I have 3 pay slips I can send them as evidence I should be able to defer.

It is child benefit and child tax credits which have tipped me over the threshold....I believe these do count as part of gross income right?

I'm not sure with regard to Student Loans but Child bEnefit and Tax Credits are not taxable, so wouldn't normally count as income. See this link for taxable/non-taxable income.
http://www.direct.gov.uk/en/MoneyTaxAndBenefits/Taxes/BeginnersGuideToTax/IncomeTax/IntroductiontoIncomeTax/DG_078305