Workaround for botched HMRC student loan repayment calculations
HMRC systems cannot differentiate between certain types of income which could lead to an overpayment of student loan deductions. What’s the solution?
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Deadline to pay Class 1B NI
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HMRC speeds up National Insurance refunds
HMRC has confirmed that it is using a new automated process to speed up National Insurance refunds. Where its records suggest that someone may have overpaid, HMRC will write to them asking them to check their employment and contribution details before any refund is processed. Could you be due money back?
If you make student loan repayments and you’re also within the self-assessment regime, you’ll be aware that any student loan repayments due on additional (typically non-PAYE) income are calculated and collected via your tax return. This would ordinarily be straightforward, but HMRC has confirmed that, despite student loan deductions not being due on benefits-in-kind, its systems are incorrectly including such income in the calculations. This means that affected individuals will end up paying higher student loan payments than is necessary. Therefore, if you’re in self-assessment and you have payrolled benefits in kind, such as a company car or private medical insurance, you will need to follow HMRC's guidance to ensure the student loans figure is calculated correctly. The current workaround is in place until shortcomings in HMRC systems can be addressed.
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