Personal tax return - darn student loan

[d000hg]

I started contracting part-way through the 2007/8 tax year and thought I'd escaped having to pay any personal tax since my previous salary was low and my dividends were not taking me over the higher tax threshold.

Then I get my return from my accountant and damnit I forgot about student loans, it's only about £1000 but still annoying since not budgeted for - my fault entirely but it just slipped my mind, and this is my first ever tax return

So, two quick questions:

1)Is there an easy way to figure approximately what my student loan repayments will be for the year based on loan balance and my income from salary & dividends? Maybe one of the online calculators covers this?

2)My tax return lists the amount as student loan, but also seems to class it as payable to the taxman. Do their systems mean I pay them and they pass it on, like how PAYE works, or do I actually need to make a direct payment to the student loan company?

[pmeswani]

I started contracting part-way through the 2007/8 tax year and thought I'd escaped having to pay any personal tax since my previous salary was low and my dividends were not taking me over the higher tax threshold.

Then I get my return from my accountant and damnit I forgot about student loans, it's only about £1000 but still annoying since not budgeted for - my fault entirely but it just slipped my mind, and this is my first ever tax return

So, two quick questions:

1)Is there an easy way to figure approximately what my student loan repayments will be for the year based on loan balance and my income from salary & dividends? Maybe one of the online calculators covers this?

Oh the joys of not having a student loan any more. . But coming back to your point, you would need to speak to the SLC (or whoever administers your student loan) as no doubt there would have been a years worth of interest added to the loan that was never paid.

2)My tax return lists the amount as student loan, but also seems to class it as payable to the taxman. Do their systems mean I pay them and they pass it on, like how PAYE works, or do I actually need to make a direct payment to the student loan company?

As the SLC (assuming that it is the SLC) are a government organisation of some sort, I would expect the HMRC to give your loan payment to them once received.

[Sockpuppet]

Any loca that is taken off via PAYE is given to HMRC who give it to the SLC.

For self assesment the same is true. THough at now 2.something% interest rate then I'm not that concerned

Why don't you ask HMRC to recoup the £1000 back through your tax code next year instead of paying the money up front.

[d000hg]

Any loca that is taken off via PAYE is given to HMRC who give it to the SLC.

For self assesment the same is true. THough at now 2.something% interest rate then I'm not that concerned

Why don't you ask HMRC to recoup the £1000 back through your tax code next year instead of paying the money up front.

I don't know what the options are, I assumed if you have to fill in a personal return you are stuck with a lump sum, since SLC payments take all personal income into account including dividends, right?

On the other hand I may be able to pay the whole thing off before April and avoid this confusion in future... would have to find out what my debt total is with them.

[TheFaQQer]

1)Is there an easy way to figure approximately what my student loan repayments will be for the year based on loan balance and my income from salary & dividends? Maybe one of the online calculators covers this?

It's 9% of any salary > £15000 this year

2)My tax return lists the amount as student loan, but also seems to class it as payable to the taxman. Do their systems mean I pay them and they pass it on, like how PAYE works, or do I actually need to make a direct payment to the student loan company?

You pay HMRC; HMRC pay SLC.

[d000hg]

It's 9% of any salary > £15000 this year

Salary, or income?

[TheFaQQer]

Salary, or income?

Income, sorry.

http://www.studentloanrepayment.co.u..._schema=PORTAL

[Sockpuppet]

I don't know what the options are, I assumed if you have to fill in a personal return you are stuck with a lump sum, since SLC payments take all personal income into account including dividends, right?

On the other hand I may be able to pay the whole thing off before April and avoid this confusion in future... would have to find out what my debt total is with them.

You get the option on the tax return - ask your accountant. I'd opt to get a new tax code next year. Allows you to defer the payment.

Don't pay off the loan. At the interest rate it'll currently be attracting it certainly doesn't make sense to pay it off. It is as close to "free money" as you will get.

If you pay say £5k loan off then you have £5k less cash but have in reality saved only a few hundred £ in interest each year. In these tough times I'd take the £5k in the bank.

If your income drops then so does your payments to the SLC.