| HMRC have announced a new
initiative to reduce student loan over
repayments for those ex students who repay
their loan through PAYE deductions. Ex
students have been in the position whereby
it has been difficult for them to avoid
over repaying their student loan as the
loan term came to an end. This is due to
the time delay between their employer
making deductions from their salary each
month and submitting an annual return
showing the individual repayment amounts
for each employee.
Ex students will now be able to opt out
of PAYE repayments in the last 23 months
of repayment and transfer to a Direct
Debit arrangement. This should mean that
the ex student will not over repay their
loan.
This new initiative has been introduced
by the Student Loans Company (SLC). The
SLC will try to contact borrowers shortly
before the last 23 months to offer and
arrange this option. However if a borrower
is aware that they are reaching this point
they can contact the SLC direct and
arrange to repay the balance of their loan
in this way.
Employers will not have to change their
procedures as their authority to stop
making deductions comes from HMRC on a
form SL2 Stop Notice and this authority
will be issued in the normal way.
Internet links:
HMRC student loan advice
SLC repayment website |
