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HMRC internal manual

Collection of Student Loans Manual

SL repayments: order of deduction: rounding down

Before 6 April 2002 an issue sometimes arose when applying an order of deduction. To rectify this the regulations were changed so that as from 6 April 2002, the net amount of any Student Loan deduction, after restriction by reference to priority court orders, must also be rounded down to the nearest pound.

The example below assumes that the

  • Annual threshold is £17,495
  • Rate is 9 per cent
  • Monthly salary is £2075
  • Protected earnings level is £850

And the

  • Net attachable earnings after priority orders applied is £903


Step 1  
Monthly salary 2075
Deduct monthly threshold 1457
Excess above threshold 618
Multiply 606 by 9 per cent £55.62
(rounded down to £55)    
  Step 2  
  Net attachable earnings after priority order applied 903
  Protected earnings level 850.00
  Scope for Student Loan deduction 53
  Deduct lesser of £54 and £53 53
(rounded down to £53.00)