Reply to: dividend and student loan repayment

[Mart001]

As for salaries the 9% is claculated on gross, so i guess you may have to calculate the 9% on gross divi's to. i.e. include the amount of the 10% tax credit.

[TheFaQQer]

Yes there is a box in the Return to say you are liable to student loan payments.

HMRC will catch up with you soon, they will just start an investigation into a previous Return as soon as they realise you should have been paying the student loan back.

I would make sure you have the money ready for when they ask for it or contact them before they catch up with you.

I beleive they will charge you interest on the unpaid loan as it is all bulked together with your normal tax liability. You would pay it off via your tax bill to HMRC who in turn pay the student loan company.

Nothing to do with me, guv!

My wife has a student loan, but doesn't earn enough to be paying it back.

My student loan was repaid a LONG time ago.

[chris79]

My student loan is only something like £3k.. I think I'll just wipe it off and add it on the mortgage to save the hassle. One less thing to worry about and the money saved is negligible now that the interest rates have dropped to the floor.

*Plus I won't get raped with fines or investigations etc, so that alone is the saving I'm making.

[chrisl]

Isn't there a box to complete for your Loan calculation?

You need to calculate it, and pay it - I haven't looked into what the penalties for not paying it are.

Yes there is a box in the Return to say you are liable to student loan payments.

HMRC will catch up with you soon, they will just start an investigation into a previous Return as soon as they realise you should have been paying the student loan back.

I would make sure you have the money ready for when they ask for it or contact them before they catch up with you.

I beleive they will charge you interest on the unpaid loan as it is all bulked together with your normal tax liability. You would pay it off via your tax bill to HMRC who in turn pay the student loan company.

[Mart001]

Dividends count. So even if you stay under the tax-free dividend limit there'll still be student loan tax to pay on it.

I have been stung for this unexpectedly after being given incorrect advice by my accountant. I really wasn't happy, but I guess I do owe the money.

what was the reprocussions? a lump sum?

[Mart001]

Not quite.

If you repay a £19000 loan slowly, or quickly, you still pay out £19000+

If you never repay the loan, then you pay £0 when it is written off at 65.

totally messed up that calc, I meshed up the 9% with the loan amount for some reason.

[jim2406]

Dividends count. So even if you stay under the tax-free dividend limit there'll still be student loan tax to pay on it.

I have been stung for this unexpectedly after being given incorrect advice by my accountant. I really wasn't happy, but I guess I do owe the money.

[TheFaQQer]

Surely those clever people at HMRC could just integrate it into your personal assessment every year?

[TheFaQQer]

That's interesting because for the last 2 years I've not been paying it back due to a low directors fee PAYE.

Even completing my self assessment with dividends declared it hasn't asked me for any payments.

Isn't there a box to complete for your Loan calculation?

You need to calculate it, and pay it - I haven't looked into what the penalties for not paying it are.

[Alan @ BroomeAffinity]

This is the first I've heard of this....

Ignorance is not an excuse

[TheFaQQer]

horses for courses, whats more comfortable paying the loan back over your life costing around 19,000 (for a 15,000 loan with current percentages, you stop paying at 65 years of age) or sooner = at 1000 per year it would take 21 years, @ 2000 per year it would take 10 years, so it would cost you more to pay it at 2000 per year as there is no offset. at around £3000 repaying per year you save money as at around six years the loan is repayed costing about £17000, So you save around £2000 (from the life time @19,000) rather than waiting for retirment age. around £60 per year if averaged. horses for courses.

Not quite.

If you repay a £19000 loan slowly, or quickly, you still pay out £19000+

If you never repay the loan, then you pay £0 when it is written off at 65.

[Mart001]

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

and then

http://www.studentloanrepayment.co.u...CUMSTANCES.PDF

[chris79]

Surely those clever people at HMRC could just integrate it into your personal assessment every year? This is the first I've heard of this....

[Mart001]

That's interesting because for the last 2 years I've not been paying it back due to a low directors fee PAYE.

Even completing my self assessment with dividends declared it hasn't asked me for any payments.

Your supposed to notify the student loans company, if they catch up with you there may be a bill coming.

[chris79]

That's interesting because for the last 2 years I've not been paying it back due to a low directors fee PAYE.

Even completing my self assessment with dividends declared it hasn't asked me for any payments.