I have not been paying my student loan

edydavies

I have been working over the last 3 years and my wage a steadily increased over the period from 18K to 26K per year. During this period my student loan has not been deducted from my account and I'm now growing more worried that I'm facing a massive re-payment.

I understand that it should have been followed up by myself, however I presumed the student loan company would either - contact me or start deducting the payments at some point.

I have been hearing stories that people in a similar situation to myself have been faced with big repayments that are due within a 30 day limit.

Have looked online, I can't get any clarification on this I'm now wanting to consider the best course of action.

Can anybody please advise not this situation.

FYI - I completed my degree in 2008 .

Thanks

Emmzi

you have been putting the payment amount aside tho, haven't you?

edydavies

I have savings which I can use to pay with but I have not been putting the exact amount aside. I'm presuming from your reply that I will be facing a large repayment?

Tixy

When you started your job did you inform your employer that you had a student loan?
You probably completed a P46 and should have ticked the relevant box.

Have you queried this with your employer?

You will owe 9% of your earnings over £15k per annum.

edydavies

No, I haven't made this enquiry with my employer and I can't remember ticking a box or not. The result of the situation is becoming clear to me, however I just want to understand what the consequences are. Will they request for a full payment to be made?

Tixy

Not a full repayment on your entire loan.

They probably will request a full repayment of everything you should have paid to date. I don't know if they charge any penalties - I haven't seen any mentioned on this forum.
If you can't afford this in a lump sum hopefully you should be able to negotiate with them to pay what you can afford and then spread the rest of the arrears over a bit longer.

Better for you to contact them than wait for thm to chase you.

If you earned £26k for all 3 years (I know you didn't but a worse case scenario based on the info given) the overdue amount would be just under £3k.

edydavies

Ok, thanks. I have worked out how much I will be paying and my savings cover it. I will let everybody know what the outcome is so.

Thanks all

green_hat778

Hiya

My student loan deductions didnt start coming out automatically either, I had to ring either student loans or HMRC (sorry cant remember which) and organise a 'Start Notice', this was reasonably straight forward and my student loan deductions started from my salary the following month from sorting it out. I think if you ring the main student loans company number, as on your loan statement, they should be able to point you in the right direction, the person i dealt with i remember being pretty helpful.

I hadn't been earning over the threshold for as long as you (about 9 months i think) and wasnt earning as much, but they didnt ask me to pay back the amounts I had missed in my case. Your case may be different, but try not to panic too much.

Goodluck

Stuart_W

If your income is entirely salaried through PAYE (ie your an employee) then student loan deductions can NEVER be backdated.

Each month, student loan deductions either are taken out for that month, or are not taken out (it's a YES or NO indicator that payroll should have flagged on your file). There is no capacity in the system for anything other than 9% of any earning above the threshold of £1,250 per month (£15K pa). This is why a one-off bonus paid in one lump can have a disproportionate student loan deduction made on it. If you usually earn £1,500 a month gross, then £22.50 loan deduction is made. If you receive a £1000 annual bonus in the next month's pay, then £112.50 loan deduction is made that month. Anyone paid weekly that gets an annual bonus can be particularly hit.

HMRC and SLC and your employer all need to communicate between themselves correctly, which is why is can take ages.

Once it is sorted, it is up to your whether you personally choose to make an overpayment, direct to the student loan company, for the amount not collected. They will not make a backdated claim.

The only exception to this is if you are self employed, complete an annual tax return and have various other sources of income, or have been abroad. For most ordinary employees, the above applies, unless there is evidence that you deliberately misled anyone.

If deductions were not flagged at the time of completing a P46 when you started, your employer cannot start making deductions until they receive SL1 notification from HMRC to start making deductions, which they will only send out when they receive confirmation from SLC.

-Make sure SLC have your correct details. Tell them you should be making deductions
-Let HMRC know you should be making deductions, occasionally they chase SLC up.
-Tell your employer that deductions should be being made (they can't actually do anything, but at least you've told them)

Eventually it will happen. Don't panic about back-dating. That can't happen for PAYE employees.

Same thing can easily happen at the other end, too. You might overpay for a while until the message filters through to your employer to stop making deductions, and you end up with a refund cheque.

The problem is only SLC can tell HMRC deductions are due to be made,
and only HMRC can tell your employer to start making deductions.

banks4u

Well in my last job I should have been paying my student loan. But for some reason it didn't come out, I informed accounts and they said they hadn't been notified. So I started my new job now and now 2 years later I have started paying my student loan. I have no missed payments or anything. I would just tell your accounts department.

brighteyes88

I really wouldnt worry. A colleague of mine who is 31 graduated 8 years ago and has only just had SL payments beginning to come out of her wages. She's been earning about 40k since graduation.

We work for the NHS and mine (at 23) has been coming out since i began working 2.5 years ago.

SL said she wouldnt be given a bill, as its their fault ! I think they must be auditing everybody and finding where they are missing out in money!