CSLM19040 | SL repayments: borrower within SA: SA - final year of loan

For the year in which the Student and or Postgraduate Loan is finally paid off it is probable that the student loan liability calculated by reference to the income shown on the SA return will not exactly match the balance on the borrower's account.

When the return is captured an SA charge will be created and the balancing payment will be due on 31 January following the end of the year of assessment. This amount will have been computed using the full year's income details and could therefore be in excess of the amount outstanding on the borrower's loan account.

If this occurs, once the Student Loan Company (SLC) has received the total deductions from the SA return, they will try to automatically refund any overpayment to the borrower. This can only happen if the borrowers details are up to date with SLC. Borrowers can update their details and check their loan balance in their online account.

To improve this process HMRC and SLC have worked together and the SLC are now able to offer borrowers who are either

• Fully PAYE

Or

• Are a combination of PAYE and SA

And

• Who are in the final 23 months of repaying their loan

an option to repay by a direct debit arrangement. This arrangement is administered solely by the SLC. In these circumstances no SA calculation will be made and employers will be instructed to stop all deductions from pay.

You can find more information on SLC website