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Previously on "Student Loans - Rebate given in error"

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  • nhussain03
    replied
    SLC and HMRC is the worst partnership ever. I was in a similar position to you while I was a permie. I got a letter to say I was at risk of overpaying, at the time my employer stop taking student loans deductions but in the background switched it to pension contributions so I was getting the same take home pay.

    1st year contracting, I forgot about the student loan and never included it on the self assessment. 18 months later, I get a letter from HMRC stating I had underpaid my student loan during the tax year and also not declared it on my self assessment. The sent a bill for the entire loan plus a fine.

    I spoke to my accountant and he said while they were right about the fine for not declaring however not the underpayment as I got a big bonus as a permie and overall in the tax year had overpaid. I tried to get the message over to HMRC who just would not have it. My accountant told me not to pay they had made a mistake. I could not be bothered to fight it as the amount was relatively small so I paid it with the fine.

    Roll forward a few months, SLC send me a refund of the fine, HMRC had just sent all of it over to SLC and because SLC could see no underpayments had been made they assumed that I had just paid my loan off. I was happy with that, but then HMRC send me a full refund of the entire amount I had paid originally, so I ended up in profit. I called them up to let them know of their mistake however yes again they were convinced I was wrong, I left it as it is.

    Lesson learned: HMRC cannot read/write/count.

    Leave a comment:


  • tl97
    replied
    Originally posted by eek View Post
    Not quite, your employer will be told to deduct the appropriate amount, include it in their payment to HMRC and then HMRC pass it on.
    If you are on PAYE, then yes. If you are just on self-assessment, then no.

    Leave a comment:


  • eek
    replied
    Originally posted by tl97 View Post
    Your self-assessment will have a box you can tick, HMRC will then deduct 9% of your income towards the student loan.

    Alternatively, you can set up a direct debit plan directly with the student loans company.
    Not quite, your employer will be told to deduct the appropriate amount, include it in their payment to HMRC and then HMRC pass it on.

    Leave a comment:


  • WordIsBond
    replied
    Originally posted by MonkeysUncle View Post
    By not declaring it on my SATR (and paying it back this way), does this or can this, put me in an awkward situation further down the line?
    If you have a good paper trail that 1) they messed up (and therefore your mistake is understandable) and 2) you've paid everything you are supposed to pay then it's hard to see how you could have more difficulty than just having to explain it. Get your explanations and paper trail in good shape now while it is all fresh in your mind.

    IANAL

    Leave a comment:


  • ladymuck
    replied
    I'd keep it off your SATR if you can and just arrange to pay directly to SLC. It's always been possible to make voluntary / additional payments outside of payroll so they ought to be able to cope with this. It's better to keep the payments under your control to prevent another feck up.

    Leave a comment:


  • tl97
    replied
    Your self-assessment will have a box you can tick, HMRC will then deduct 9% of your income towards the student loan.

    Alternatively, you can set up a direct debit plan directly with the student loans company.

    Leave a comment:


  • MonkeysUncle
    replied
    Hi All
    If your interested in an update.

    Yes I do need to pay it back. HRMC called yesterday and basically I have been paid the rebate back twice.
    HMRC paid it back when I submitted by SATR for that year (17/18). I remember getting this but it didnt say it was rebate for Student Loan, it was due to overpayment. At the time I thought it was due to going onto an inside role for 6 months and then changing to an outside role.

    Apparently HRMC notified SLC (something about putting a stop on my account)...who didn't update their records so they when they reconciled my account, they also realised I had overpaid and then raised a rebate through HMRC to pay me back the 2k again!

    So yes I have to pay it back. Now the question is how

    My accountant has completed my SATR for the last year and stated I have no student loan (as I thought I didnt). They have said that rather than amend the SATR, it may just be easier to organise a payment plan with SLC.

    My question to him (of which I am still waiting answer) and I dont know if anyone on here can answer.

    By not declaring it on my SATR (and paying it back this way), does this or can this, put me in an awkward situation further down the line?

    Leave a comment:


  • jayn200
    replied
    Originally posted by ladymuck View Post
    Isn't there some "thing" whereby if a refund was made in error and you, as the recipient, genuinely didn't realise an error had been made and spent the quids, you can keep the cash? It's not like the SLC doesn't have form for being utterly rubbish at managing loans with millions owed in refunds for overpayment.
    You can't keep the cash.

    If you received the refund in error and spent it without noticing and it was a genuine mistake then it's not a criminal act but you still need to repay the debt. You can probably arrange a payment plan.

    If you received the refund in error and spent it when you knew it was given to you in error then it's a crime and you still owe the money but you may also get additional criminal charges.

    Leave a comment:


  • wattaj
    replied
    As an aside, and having worked there twice, SLC are a tulipstorm of incompetence and over confidence. IMHO, it would be cheaper and more efficient to go back to handing out grants and being done with it.

    Leave a comment:


  • PerfectStorm
    replied
    I can only offer my sympathies. Every interaction thats meant getting a student loan finalised between the SLC and HMRC always makes the individual feel like this is being done for the very first time in history, rather than something that happens hundreds of thousands of times each year.

    Mine was in and out of my last few years of SA before all agreed that yes - it had been paid off

    Leave a comment:


  • Old Greg
    replied
    Originally posted by MonkeysUncle View Post
    No I didnt.
    I got a letter from SLC saying that I have overpaid and a rebate was due (this was back in 2019) and to call them. I did, they said i was owed 2k due to overpayment. More than likely this was due to be being on an inside IR35 role for half the year which meant I paid Student loans as part of my PAYE and the other half I didnt, but paid it in my SATR.

    I got paid the 2k, used did actually use it for a holiday.

    I would never have known it was an error if I didnt log into the HMRC website and check. As far as I was aware, my student loan was paid off.
    I think you need to pay it back, but maybe go to a specialist forum (MSE might be good).

    Leave a comment:


  • MonkeysUncle
    replied
    Originally posted by Paralytic View Post
    I suspect they fully knew the £2K was paid to them in error at that point at which that happened.
    No I didnt.
    I got a letter from SLC saying that I have overpaid and a rebate was due (this was back in 2019) and to call them. I did, they said i was owed 2k due to overpayment. More than likely this was due to be being on an inside IR35 role for half the year which meant I paid Student loans as part of my PAYE and the other half I didnt, but paid it in my SATR.

    I got paid the 2k, used did actually use it for a holiday.

    I would never have known it was an error if I didnt log into the HMRC website and check. As far as I was aware, my student loan was paid off.

    Leave a comment:


  • Paralytic
    replied
    Originally posted by ladymuck View Post
    They only found out when they looked at their account after being notified that the details were now on GOV.UK and wanted to see what the new format looked like.
    I suspect they fully knew the £2K was paid to them in error at that point at which that happened.

    Leave a comment:


  • Old Greg
    replied
    Originally posted by ladymuck View Post
    Isn't there some "thing" whereby if a refund was made in error and you, as the recipient, genuinely didn't realise an error had been made and spent the quids, you can keep the cash? It's not like the SLC doesn't have form for being utterly rubbish at managing loans with millions owed in refunds for overpayment.
    It is very much exceptional cases, if the OP wants to argue that in a civil court, or just possibly (unlikely) on a criminal charge of 'retaining wrongful credit' under the Theft Act 1968.

    Leave a comment:


  • wattaj
    replied
    Back in the day, SLC and HMRC did not have real-time data sharing so it was possible to have cleared one's student loan and still be paying it off via PAYE. Many, many thousands was incorrectly collected by SLC and had to be mopped up every couple of years.

    That might have changed now, but I think that that's unlikely given how protective HMRC are towards their thiefdom.

    Personally, I'd say ****-em and wait for a bill at some point. usual caveats: IANAL, IANAA, etc., etc...

    Leave a comment:

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