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HMRC internal manual

Collection of Student Loans Manual

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HM Revenue & Customs
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Compliance: employer compliance: employer compliance - legislation

The primary legislation for income-contingent Student Loans is in the Teaching and Higher Education Act 1998. Secondary legislation, The Education (Student Loans) (Repayment) Regulations 2009, enacted by the Secretary of State for Education and Employment (now Innovation Universities and Skills), empowers HMRC to collect Student Loan repayments on the Secretary of State’s behalf and contains the framework for Collection of Student Loans. Part IV of the Regulations covers Deduction of Repayments by Employers.

The table below gives a brief explanation of the regulations under The Education (Student Loans) (Repayment) Regulations 2000 relevant to employer compliance work.

Section Explanation
   
Reg 50 Employer Obligations
Make deductions where a notice received for an employee    
  Reg 52 Employer Obligations
Record deductions on deduction working sheet for each employee    
  Reg 53 Employer Obligations
Provide employee with a certificate showing deductions made    
  Reg 54 Employer Obligations
Pay the amounts deducted to HMRC    
  Reg 59 Employer Obligations
Make an annual return of loan repayment deductions    
  Reg 61 HMRC Powers
Inspection of employer’s records    
  Reg 62 HMRC Powers
Formal determination of repayments payable by employer    
  Reg 63 Interest and Penalties
Interest payable on deduction made but not paid by 19 April    
  Reg 59(5)&(6) Interest and Penalties
Failure to make return penalties    
  Reg 59(8)(a)&(b) Interest and Penalties
Incorrect return penalty    
  Reg 68 Interest and Penalties
Incorrect deduction penalty

Note: Under Schedule 36 FA 2008 information powers can be used to obtain documents and particulars from third parties.(This content has been withheld because of exemptions in the Freedom of Information Act 2000)