Any concerns? I’ve very nearly finished repaying my education loan – how do you avoid overpaying?

Any concerns? I’ve very nearly finished repaying my education loan – how do you avoid overpaying?

We regularly get inquiries via our web sites. We don’t offer advice, but we make an effort to signpost to resources of further information and help. A few of the replies may be helpful to others, therefore sporadically we are going to publish them anonymously as ‘question and response’ news products. We now have gotten question recently from a student-based loan debtor who has got nearly completed repaying their education loan.

Take note – this is certainly published as a ‘news’ item, this means the information and links aren’t evaluated and updated. You shouldn’t count on it without checking the entire facts of your instance using the figuratively speaking Company or an income tax adviser.


We have very nearly completed repaying my Arrange 1 education loan. I’ve read inside the news that borrowers are able to find by by themselves overpaying their loans which demonstrably i will be keen in order to avoid. So what can i actually do to avoid this from taking place?


We realize that this is often a typical issue and the one which both borrowers while the scholar Loans Company (SLC) desire to avoid. Whether you pay through Pay As You Earn (PAYE) or through Self Assessment unless you are working abroad, you will repay your student loan(s) through the tax system. Overpayments may appear to the end of repaying the mortgage as a result of timing variations in sharing information between HMRC, that are gathering the mortgage repayments, in addition to SLC whom administer the loans. Nevertheless, HMRC and also the SLC will work towards more data that are frequent which ideally should reduce this issue taking place as time goes by. Tax Guide for pupils describes just exactly just how education loan repayments are determined and exactly how the repayments are formulated through the taxation system.

For the time being, then there are some actions you can do to prevent overpayments from happening if you are coming to the end of repaying your student loan.

  • Whenever you are about couple of years from completely best payday loans in Virginia repaying your student loan(s) you’ll contact the SLC and inquire to quit repaying your loans through PAYE and alternatively go on to making repayments straight to the SLC through month-to-month direct debits. We realize that just a 3rd of borrowers decide for direct debits and also the SLC are keen to encourage more borrowers to do this because it should avoid overpayments.
  • Make sure that the SLC has up-to-date contact information so if need be that they can contact you. The SLC should monitor borrowers’ records having a view to distinguishing if you’re getting near to repayment that is full. If you should be nearing the finish of your repayments chances are they will contact one to provide to change one to direct debit repayments.
  • It is important to remember that for those who have fluctuating earnings, as an example you work overtime or get bonuses, then it could be hard for the SLC to ascertain once you may be nearing complete payment. You might contact the SLC to inquire of to be relocated to a debit repayment plan that is direct.

Should you go on to direct debit repayments then there are some points to be familiar with:

  • Failure to maintain with direct debit repayments will imply that you can expect to back be moved to repayments through the PAYE tax system.
  • Whenever changing your task, you ought to be expected to accomplish a starter that is new that will ask you to answer if you should be repaying your figuratively speaking. On question 11 ensure you state so you will end up paying twice and overpayments will occur that you are repaying your student loan directly to the SLC by direct debit otherwise HMRC will start deducting repayments through PAYE.

Then you should contact the SLC as soon as possible and ensure they have your correct bank details if you have already overpaid. But keep clear of any phishing email messages or telephone calls from fraudsters pretending to end up being the SLC!

To learn more about repaying student loans see our begin to see the learning student loans section in Tax Guide for pupils.

Contact: Claire Thackaberry (be sure to utilize type at e mail us) or follow us on Twitter: @litrgnews

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