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HMRC internal manual

Collection of Student Loans Manual

From
HM Revenue & Customs
Updated
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SL repayments: underpayments and overpayments: employer over-deducts loan repayments

There may be occasions where due to an error the employer makes an excessive Student Loan deduction from a borrower’s pay, for example, if the Student Loan Deduction Tables have been misunderstood.

Note: The employer should never agree with the borrower to deduct excessive amounts of Student Loan repayments. This suggestion may arise if the borrower wishes to settle his or her account more quickly. Deductions should always be made in accordance with the Student Loan Deduction Tables. If the borrower wishes to make additional payments this should be arranged with the Student Loans Company. Such payments would, however, be in addition to, and not instead of, payments deducted by the employer from earnings.

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Error discovered in year

If the error is discovered in year, or before the End of Year forms and final remittance have been sent to HMRC, the employer should

  • Repay the employee, showing the amount of the repayment as a minus on the employee’s payslip

And

  • Make any necessary adjustment to the amounts paid to HMRC when the next Full Payment summary (FPS) is sent. Note: Error discovered after the end of the year or after the borrower has left

If the error is discovered after the End of Year forms have been submitted to HMRC, or after the borrower has left this employment, HMRC will make any repayment due direct to the borrower. The employer does not need to take any further action to rectify the error.

East Kilbride Student Loans Unit will handle all cases where Student Loan deductions have been made incorrectly. Under no circumstances should the local office attempt to repay Student Loan deductions. The local office should refer all correspondence and telephone calls to East Kilbride Student Loans Unit.

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Action by East Kilbride Student Loans Unit

Once East Kilbride Student Loans Unit have confirmed that the Student Loan deductions were made in error they will issue a manual repayment direct to the taxpayer using existing clerical and supervisory procedures.

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