Student Loan Repayments: Increased Thresholds From April 2021
Repayment of student loans is a shared responsibility between the Student Loans Company (SLC) and HMRC. Employers have an obligation to deduct student loan repayments in certain circumstances and to account for such payments ‘in like manner as income tax payable under the Taxes Acts’. There are two plan types for student loan repayments, which have different repayment thresholds. From April 2021, the thresholds are as follows: • plan 1 with a 2021-22 threshold of £19,895 (£1,658 a month or £382 per week) rising from £19,390 in 2020-21); and • plan 2 with a 2021-22 threshold of £27,295 (£2,275 a month or £525 per week) rising from £26,575 in 2020-21). Plan 1 loans are pre-September 2012 Income Contingent Student Loans and repayments will start when the £19,895 threshold is reached. Loans taken out post-September ...