Student Loan Mutliple Emoyers Overpaid

Dave817

Hello,

I am keen to get more advice about student loan repayments with multiple jobs and variable income.

I have a plan 2 student loan.

For the 2020 to 2021 tax year my repayments have got complex.

From the start of the tax year to beginning of August I had one job and my employe4 deducted regular amounts, all was simple.

Since then and until the end of the year I have a couple of jobs, paid hourly with variable hours. Due to weekly time slips I am confident I will be over paying as in a given week it seems I will earn a lot, but averaging out over the year whilst still above the threshold it will be slightly less.

In my second job I am reliably below a repayment threshold and not paying student loan.

My question is:

1. If as I am sure I will, I overpay student loan for the year can I claim it back, or should my employer reduce repayments from now on? 

2. If I do overpay and try to reclaim will SLC take into account all my earnings from both employers now and my previous employer (as happens if you do a tax return?), or will each employer keep its seperate threshold (this is critical for me as reclaiming overpaid student loan for one employer could back fire if I then pay it on the other employers that are below threshold)

3. Similarly and perhaps of use to people more widely - if you change job mid tax year so your total earnings with each employer for that year end up being below threshold (even though total income isnt) how does this work? 

silvercar

If your total income for the tax year is below the threshold, you can ask slc to pay the repayments you have made back to you.
If you go over the threshold for the tax year as a whole, then anything legitimately taken from you on a month by month basis can't be repaid.
Any job where you are below the threshold in any individual month, shouldn't make a student loan deduction.
What usually happens is that if you are over the threshold in total income, after the tax year ends, you and hmrc will see that the deductions that have been made are not enough. Slc should then be in contact with you to make an extra payment. 

silvercar

In answer to your questions:
1. No, you would claim it back if eligible
2. Slc will take into account all your income. They won't offer repayments for anything paid over when the calculation for that month's pay correctly makes a deduction, even though for the year you may be under the threshold.
3. Each employer will make a deduction based on your earnings in that month. So they don't really need to know what your previous earnings were. (Unlike the tax system where your previous earnings can influence your tax and hmrc should adjust your tax code to take account of this).
After the tax year is complete, you can see your total income and work out what your deduction should have been. I would think that running with 2 jobs where one is below the threshold will result in you having an underpayment to make up. You seem to think you will have had too much deducted.

Ed-1

silvercar said:

In answer to your questions:
1. No, you would claim it back if eligible
2. Slc will take into account all your income. They won't offer repayments for anything paid over when the calculation for that month's pay correctly makes a deduction, even though for the year you may be under the threshold.
3. Each employer will make a deduction based on your earnings in that month. So they don't really need to know what your previous earnings were. (Unlike the tax system where your previous earnings can influence your tax and hmrc should adjust your tax code to take account of this).
After the tax year is complete, you can see your total income and work out what your deduction should have been. I would think that running with 2 jobs where one is below the threshold will result in you having an underpayment to make up. You seem to think you will have had too much deducted.

https://www.gov.uk/repaying-your-student-loan/what-you-pay

If you have 2 or more jobs

If you’re employed, your repayments will be taken out of your salary. The repayments will be from the jobs where you earn over the minimum amount, not your combined income.

There is no requirement to make extra payments unless you have to do a tax return for any other reason. You do not need to do a tax return just because you have more than one job and therefore there is no requirement to make extra repayments on your student loan. You get the benefit of the full threshold per employer, as you do with National Insurance (but not income tax). It's a neat way to save a lot of money.