Student Loan repayments & Bonuses

mooomin

Hi all,

First post, so be gentle!!

I have a student loan and am making the paltry repayments directly from my salary each month.

Thing is, each year I am lucky enough to get an annual bonus, which last year was about £2000 before tax. The Student Loans folk will then take a couple of hundred pounds off my bonus before I get it.

I called them and explained that this wasn't the world's best payrise and that the bonus brought my annual salary up to about 19k and they had taken too much, their view was essentially "We have your money now so tough".

Is there any way that I can avoid this? Would it be better to arrange a direct debit with them as they would not be aware of my bonus?

All help will be appreciated.

Cheers :j

Loose_Cannon

In short: No, there is no way you can avoid this!

If you're an employee under a PAYE scheme, your student loan deductions are made on every pay cheque by HMRC. They will deduct the appropriate %age from your bonus as well as your regular salary.

sarah_elton

Unfortunately not.

They take a fixed percentage of anything you earn above £15k. I believe it's 9% but that may have changed since I last knew. Therefore, if your salary is over £15k and you get a bonus, you will pay 9% of your bonus as a student loan repayment.

Your bonus will be paid through your employer's PAYE system so there's nothing you can do to stop them finding out about it I'm afraid.

pinkshoes

They take 9% of any earnings over £15k p.a. so naturally they take 9% of your bonus, as without your £2k bonus, your salary was still over the threshold!!

They also take 9% if you get paid for any days holiday you haven't taken, which I find a little unfair, as it's a replacement for a day holiday, NOT salary earnt.

Such is life!