Student Loans

From 06/04/16 there are two types of student loan, plan 1 and plan 2 and it is important that the employers and payroll administrators know which type of loan an employee may have.
An employee should advise on which loan they have on either the new starter checklist or via a previous P45. If an employer is unsure they should opt for plan 1.
What are the two plans?

 

Plan 1 Plan 2
   Who is eligible? English and Welsh Students before 01/09/12
All Scottish and Northern Irish Students
English and Welsh Students before 01/09/12
All Scottish and Northern Irish Students
When does the loan start to be repaid? Deductions are made from earnings above £17,495* per annum.

*This figure is updated on 5 April each year

Deductions are made from earnings above £21,000 per annum.All Scottish and Northern Irish Students
How much are the repayments? £9% of earnings above the minimum limit £9% of earnings above the minimum limit
What is the interest charged to the student? 1.25% Inflation + 3%
By | 2017-05-25T11:21:19+00:00 October 6th, 2016|Payroll|0 Comments

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