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MSE News: 40,000 urged to reclaim £22m in student loan overpayments

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MSE News: 40,000 urged to reclaim £22m in student loan overpayments

edited 28 July 2011 at 10:32AM in Student Money Saving
18 replies 6.8K views
MSE_GuyMSE_Guy MSE News EditorMSE Staff
1.7K posts
I've been Money Tipped! Newshound! Chutzpah Haggler
edited 28 July 2011 at 10:32AM in Student Money Saving
This is the discussion thread for the following MSE News Story:

"Tens of thousands of graduates have been urged to claim money back, as the SLC has taken millions in overpayments ..."
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Replies

  • sphericspheric Forumite
    110 posts
    I'll have overpaid my student loan in the last tax year, but via a different scenario: I started work part-way through the year, had student loan deductions taken from my monthly pay, but had totted up less than £15k by the end of the tax year.

    However, my P60 hasn't appeared, so I expect that it'll be an administrative nightmare to get the cash back, and it seems somewhat pointless for a few hundred quid; especially given that I'll owe them the money sooner or later anyway.
  • cha97michellecha97michelle Forumite
    5.8K posts
    Part of the Furniture
    ✭✭✭✭
    We got £500 back last month because the student loan company wrote to us telling us we had overpaid. Because the tax office got my husbands tax code wrong they took too much tax off his income, but also told the student loan company to do too much. This dated back to us from 2008.

    So with refunds from both places, I am happy. Families who struggle with money could have gone under being overtaxed like this. It is definitely worth being pro-active and chasing this one, as we were paid by cheque as my husband closed the student bank account the loan originally was paid into a long time ago. It took far longer to get back than we expected.
  • In the article it mentions that you can switch to direct debit if you're in the last 2 years of your loan repayments. However, when the money goes via HMRC, then isn't that from your gross salary, i.e. tax free?

    If you pay by direct debit then this is from money that you've already paid tax on, so you're paying 20-40% more than you need to? Or have I got it wrong?
  • In the article it mentions that you can switch to direct debit if you're in the last 2 years of your loan repayments. However, when the money goes via HMRC, then isn't that from your gross salary, i.e. tax free?

    If you pay by direct debit then this is from money that you've already paid tax on, so you're paying 20-40% more than you need to? Or have I got it wrong?

    I think you've got it wrong. There is no tax benefit to paying student loans via payroll.
  • whitfreakwhitfreak Forumite
    276 posts
    sheepworrier you're wrong I'm afraid.

    How much your student loans repayment is, is calculated on your gross income. However how much you're tax bill is, is also calculated from your gross income. The student loans payment is not subtracted from your income before the tax is calculated.
  • MiddyMiddy PPR
    5.4K posts
    Regarding student loans. I wish the SLC would understand when I get my annual bonus from work, I get that paid annually, not every pay day. Last time I was deducted £21. If I multiplied that gross pay by the number of paydays I get (13), my salary would be under £20k. I wish it was under £20k normally, only £13k.

    I did phone them up once and due to them employing people based on their thick Glaswegian accents, not on customer service skills, I wasn't able to get anywhere.
  • Yes I had that too Middy, I worked a few saturday's as extra, as this showed up on 3 wage slips, I was classed as earning enough and was forced into paying it back (the saturdays were not guaranteed work) I don't think I have ever earned over their threshold over the past 5 years, but am now forced to work an extra saturday each money to purely pay this off. Its going down though bit by bit, so gotta be thankful.
  • MummyC_3MummyC_3 Forumite
    10 posts
    Ridiculous system!
  • Your article says: "If you don't want to risk overpayment, if close to paying your debt off, you can either make a one-off final payment or set up a direct debit to make the remaining installments"

    I owe about £5 to the SLC, and I have been trying since May to get a final invoice! I am travelling in Canada, I have given them my last pay slips for 2011-12, my P60 for 2010-11, my P45... I settled the outstanding amount via the website, I have so far written four letters and they keep threatening me to charge me over £150/£200 because I cannot tell them how much I will be earning in 2011-12. It is really absurd and I do not know what to do.
  • I phoned Thesis today as I thought that I had probably finished paying my loan back (wasn't 100% sure as the last statement they sent me was back in August 2009.

    Turns out I had overpaid by £1129.27.

    Nice of them to tell me!

    I wonder how long they would have waited until they told me. Disgusted with how they can get away with this.
This discussion has been closed.

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