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HMRC internal manual

Collection of Student Loans Manual

Compliance: borrowers compliance: self assessment

Borrowers are switched on for SA purposes by a formal notice from the Student Loans Company. The notice is issued when the borrower is matched (CSLM14000) and specifies the first year of assessment for which repayment is due.

Borrowers have to provide certain information to the Student Loans Company to enable them to issue the borrower with a notice to switch on Student Loan repayments under self-assessment. Unless borrowers are already within self-assessment, they are not obliged to notify HMRC that they have a student loan and are liable to make repayments.

(This content has been withheld because of exemptions in the Freedom of Information Act 2000) CSLM8545(This content has been withheld because of exemptions in the Freedom of Information Act 2000)

If they receive an SA return for a year for which they have been switched on, borrowers are required to self-assess student loan repayments alongside their income tax, CGT and class 4 NIC liabilities. Borrowers should not be brought within self-assessment solely to recover Student Loans repayments.

Borrowers must continue to self-assess student loan repayments for every subsequent year for which a return is required until ‘switched off’ by another formal notice. They must self-assess repayments even when the loan has, in fact, been repaid. However, see CSLM20045 where the repayment a borrower is required to self-assess exceeds the balance of their loan.

SA Repayments are due each year at the same time as the income tax balancing payment - 31 January following the end of the relevant tax year.

The rules concerning repayments under SA, including interest and penalties, are dealt with in more detail in the section ‘Borrower Within SA’ at CSLM19000 onwards.

The SA Manual contains guidance on processing self-assessment returns that include student loan repayments (SAM121610) and notifying the Student Loans Company of repayments included in discovery assessments or contract settlements (SAM31053). It is important that that the Student Loans Company credits borrowers for all repayments whether deducted under PAYE or paid under self-assessment including any repayments recovered following an enquiry.