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About LinkBacksThe base isn't that high - it used to be 18k and has probably gone up a bit with inflation.
Did you tell the SLC about your new job?
The base isn't that high - it used to be 18k and has probably gone up a bit with inflation.
Did you tell the SLC about your new job?
18k? i was lower then that on my previous job yet i still had to pay for it :s well i filled out one of those p45 forms i think it is and ticked the box that asks if i pay student loan.
anywhere i can check to see how much i have paid so far and how much needs to be repayed
According to the Inland Revenue, and various government ministers on TV recently, the starting point for payments is £15,000 pa (£1250 per month), not £18,000. You then pay 9% on income over that limit. And the calculation of monthly payment is done per month, so it varies with income, and may cease if income drops below the limit for that period (month, week, whatever).
Inland Revenue page
So you could find payments starting and stopping of income hovers around the limit, going above and below it.
Oh, and there are some other things that affect whether you pay or not, like the level of interest earned on savings), but the above seems to be the basics.
it will be taken off by PAYE, so bug your HR department!
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Saracen, it's 'having a cookie' time...Originally Posted by Saracen
That's correct - it's currently £15,000 and you pay 9% of whatever's over per month. However, if your loan size is anything like mine, you won't actually be paying your loan off it just keeps going up (as the current interest rate on total loan = 4.8%), so until you're on some serious income you could well be going into more debt, even though you're paying every month!
There is a chance it will never be paid off in your lifetime...
is it possible to pay all or half of it all together? how do u find out how much u have to pay more?
Apologies for the 18k figure - not sure where I got that from then. I think they send you annual statements to show how much you have remaining etc.
Well .... yes, but there's more than one way of looking at that. The interest rate, the government will tell you, is 0% in real terms. The rate you incur is determined by linkage to the RPI, so effectively all it does, if you make no payments, is maintain the debt at the same level in real terms.
Year on year, prices rise. Year on year, all other things being equal, most people expect to get at least an inflation-covering pay rise. So if your debt goes up by the same percentage as your inflation-covering pay rise, in real terms, you're no worse off, even though the money sum is going up all the time. So if you pay nothing off for, say, 10 years, the amount of cash you owe will go up, but the logic is that the purchasing value of that cash is the same after 10 years as it was at the start.
And even as it is, there might be argued, currently, for there to be an incentive to stick any spare money that you don't have to pay (i.e. anything above those payment made by deduction at source via PAYE) into savings accounts. With careful choice of account, and careful financial management, there are savings accounts that will hit 10% (gross) currently, and with some extra conditions, even 12%.
So, for anyone with a student loan and some spare cash, you might well be advised to save it, because your earnings on savings will go up faster than the interest on the student loan.In that case, over time, your debt will go some way to paying itself off. It is certainly a very cheap form of loan compared to anything commercial.
One word of warning though. The system is notoriously poor for keeping accurate track of what you have paid off. So keep your payslips that show loan payments made, and keep any P60s too. The problem is that the SLC maintain the loan, but HMRC recover the payments via PAYE, so until HMRC notify the SLC that payment has been made they have no way to know it has. And if anything goes wrong, it can be down to YOU to prove payment has been made.
So keep payslips. And I mean every single one that has a payment on it, until at least you have a P60 showing those payments, or the loan is paid off and clear. If you don't, you risk ending up paying twice, or at least, having a long fight with a monolithic bureaucracy over it. And that's no fun at all.
damm. my payslips are everywhere. guess i have to notify my HR about the student load has if i dont pay for it the interest goes up innit. mind u I only used the student load for two years not the full 3 years has in my first year my parents paid for the uni fees.
Good advice. I thought it was kind of ridiculous that they couldn't tell me what my balance was when I called them up last year, especially since I'd misplaced my annual statement :/
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