If I'm not being taxed until 2010...

aleph_0

kenan557 wrote: »

As I said previously any money you receive DIRECTLY from SLC to your bank counts as income. I have confirmed this with SLC.

Are you able to find a source (that it is counted as income for the purpose of tax, not just that it counts as income for the purpose of benefits)? We have the HM Revenue & Customs website saying one thing, and you saying another.

As well as the page previously given, http://www.hmrc.gov.uk/calcs/stc.htm states that student loans don't count as income for tax purposes

prudentsaving42

A few months ago I rang up SLC and asked them the specific question. They said that anything to my bank would be counted as income and that I should not save it as tax-exempt if I have passed the threshold. Upon inspecting the HMRC website it is safe to assume that all types of student loans are excluded when calculating taxable income. I have not come across any information regarding grants, bursaries and scholarships and assume that they are definitely income as they are non-repayable.

Regards,

Kenan

andromache_2

WHOA you scared me, kenan!! Student loans, academic scholarships, parental contributions, bursaries etc are NOT counted as income for tax purposes: http://www.hmrc.gov.uk/students/are_st_loans_taxable_6_4.htm. They're only counted for benefit purposes, e.g. apparently I get £100 too much student loan for free prescriptions and dental care :rolleyes:

LittleVoice

kenan557 wrote: »

A few months ago I rang up SLC and asked them the specific question. They said that anything to my bank would be counted as income and that I should not save it as tax-exempt if I have passed the threshold. Upon inspecting the HMRC website it is safe to assume that all types of student loans are excluded when calculating taxable income. I have not come across any information regarding grants, bursaries and scholarships and assume that they are definitely income as they are non-repayable.

Regards,

Kenan

When staff tell you things on the phone which are important interpretations of the law or the organisation's terms and conditions, get it in writing from them or a reference to where you can find it in written form.

Mikeyorks

kenan557 wrote: »

A few months ago I rang up SLC and asked them the specific question. They said that anything to my bank would be counted as income

I trust you validate your research a little more carefully than that in whichever subjects you're studying?

Absolutely and emphatically ....... Student Loans do not constitute taxable income. They're a subsistence facility. Big enough uproar when the Govt moved to Uni funding and Students having to borrow money to pay their way through. There would have been anarchy had the loans constituted taxable income.

aleph_0

kenan557 wrote: »

A few months ago I rang up SLC and asked them the specific question.

That's where you went wrong. The SLC don't care about giving tax advise, that is the realm of HM Revenue, who have published the answer.

prudentsaving42

andromache wrote: »

WHOA you scared me, kenan!! Student loans, academic scholarships, parental contributions, bursaries etc are NOT counted as income for tax purposes: http://www.hmrc.gov.uk/students/are_st_loans_taxable_6_4.htm. They're only counted for benefit purposes, e.g. apparently I get £100 too much student loan for free prescriptions and dental care :rolleyes:

I think you didn't quite understand. Grants and bursaries are not taxable but they count towards income. Taxable income is income that you pay tax on. You don't pay income tax on grants but they still count towards your annual income i.e. they are "earned/unearned money coming in excluding certain benefits". Loans are not money in technically, so I think we have cleared up that they do not count towards your income.

Could anybody agree with the above and/or give a better clarification?

prudentsaving42

Mikeyorks wrote: »

I trust you validate your research a little more carefully than that in whichever subjects you're studying?

Absolutely and emphatically ....... Student Loans do not constitute taxable income. They're a subsistence facility. Big enough uproar when the Govt moved to Uni funding and Students having to borrow money to pay their way through. There would have been anarchy had the loans constituted taxable income.

I assume by "taxable income" you mean money counted towards income and not money that tax gets deducted on (like wages). What we are trying to clarify is the following:

When HMRC asks me for my annual income do I count my Student Maintenance Loans, Maintenance Grant (non-repayable), University Bursary (non-repayable), and Scholarships (non-repayable).

I am assuming that student loans do not count towards income however the latter three do. Any other suggestions?

Think of it this way: If I received a £500,000 scholarship/award from my University, it would not be taxed, i.e. none of it would be deducted. However it would put my "annual income" above £36,000 threshold and would make me a higher-rate tax payer (40%) on Savings for example. Hence the OPs dilemma. Similarly as I am receiving grants, bursaries over £5,435 this makes me a basic rate tax-payer on savings (20%). Does anybody agree with this?

aleph_0

kenan557 wrote: »

Does anybody agree with this?

I don't. I can't find any references where HMRC take into account non-taxable income in determining tax on taxable income. If the did, you would expect there to be room for such declarations on tax returns (since large amounts of people are earning non-taxable income in the form of ISA interest), which as far as I can tell, there are not.

My advice: actually contact HMRC with your situation and see what they say.

Paul_Herring

I am assuming that student loans do not count towards income

In much the same way that borrowing £100,000 off the bank to buy a house doesn't count as income.

How this idea that a student loan counts as income came about I'm not quite sure.....