Student loans: over-repayments on the increase

A Freedom of Information request by Baker Tilly has uncovered that over-repayments by employees of income-contingent student loans continue to rise because, despite employers’ real time reporting, information of the amounts collected by HMRC is supplied only annually (long after the tax year end) to the Student Loans Company (SLC).

Although students are reminded by the SLC to switch to a direct debit repayment system once they are within two years of settling their loan, so that the problems caused by this time lag are avoided, it seems that large numbers of former students place their faith, mistakenly, in the timeliness and accuracy of the PAYE system and ignore this instruction.