Money and leaving university 2020 - Information for UK undergraduate students finishing their course in Summer 2020 - Loughborough University
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www.lboro.ac.uk/services/sass Student Advice and Support Service Money and leaving university 2020 Information for UK undergraduate students finishing their course in Summer 2020
Money and
leaving university
Repaying Student Loans How much you will pay back
Loan repayments normally start in the April There are two different repayment thresholds
after graduation or leaving your course ie April depending on when you started your course
2021 for those finishing in June 2020. Tuition and whether you were funded as an English,
Contents fee and Maintenance loans are treated as one
debt for repayment purposes.
Welsh, Northern Irish or Scottish resident.
There is more information at SLC repayments.
If you are working in the UK, repayments are Plan 1
Repaying Student Loans 03 collected from your salary through the PAYE
Students funded by Student Finance England
(Pay As You Earn) scheme. This should
How much you will pay back 03 happen automatically but check your payslips. and Student Finance Wales who started prior to
See the table below for how much you might 2012 can use the SLC repayments web page
What if you move abroad? 04
repay. to see how their monthly payments work out.
What if you default on repayments? 04
If you are abroad, self-employed or have Students funded by Student Finance Northern
Interest rates 04
significant unearned income then you will Ireland and Student Awards Agency Scotland
Write off of Student Loans 05 have to arrange payment to Student Loans will repay under Plan 1 regardless of start date.
Company (SLC) by direct debit. For self-
National Insurance when you start work 06 employment the amount you pay will be From 6 April 2020 the repayment threshold for
calculated based on your HMRC self- Plan1 loans increased to £19,390.
Council Tax 06 assessment form. You will need to inform
HMRC that you are self- employed. Plan 2
Benefits 06 If you are in a position to repay part or your
Students funded by Student Finance England
entire loan early (SLC) will accept ‘one-off’ and Student Finance Wales who started in
Postgraduate study 06 payments to your loan account. It is wise to 2012 or later will repay at a rate of 9% of any
consider whether this is worthwhile. If you income over £26,575. The repayment
have other debts with higher interest rates, threshold is expected to increase each April in
Banks and Building Societies 07 line with inflation.
then it makes sense to repay those first.
Further help 07 There is no penalty or additional charge No repayments are due if your gross income
for repaying early. The MoneySavingExpert is less than £26,575 per year. Certain disability
Useful websites 08 website offers advice on whether it is worth benefits and any unearned income of less than
repaying early. £2,000 are disregarded for these purposes.
Unearned income includes income from
investments, renting out property and interest on
savings. Your salary or wages are earned
income. More details about Plan 2 Income
Contingent Student Loans here.
PLAN 2 STUDENT LOANS
TABLE OF REPAYMENTS FOR SAMPLE INCOME LEVELS
MONTHLY SALARY MONTHLY REPAYMENT
£0
£27,575 £2,299 £7.50
£31,575 £2,631 £37.50
£36.575 £3,048 £75.00
£41,575 £3,465 £112.50
02 03
What if you move abroad? Interest rates Write off of Student Loans
If you are abroad and outside the UK tax Plan 2 student loan interest rates are
system, any repayments would have to be normally based on the Retail Price Index
AWARDING AUTHORITY DATE LOAN FIRST TAKEN OUT UNPAID AMOUNT
made direct to the Student Loans Company. (RPI) of the previous March (RPI = 2.4% in
WRITTEN OFF AFTER
They require you to notify them immediately March 2020).
if you are planning to live abroad for 3 Student Finance England 25 years
months or more. If you move overseas and Plan 2 interest rates are shown in the table Student Finance Wales
fail to provide the information required, SLC below.
can charge a default monthly repayment Student Finance England 30 years
figure and may apply a penalty rate of Plan 1 loans have a single rate of interest. Student Finance Wales
interest, significantly above the normal The current rate from September 2019 is set Student Awards Agency 01/09/2007 or later 35 years
amount. The repayment threshold varies at 1.10%. This rate is currently set using the Scotland
according to which country you are living in. bank base rate rather than RPI due to the
There is more information here. unusually low rate of bank base rate. Student Finance Northern 25 Years
Ireland
What if you default on repayments?
If you are in arrears with loan repayments The number of years is calculated from If you took out a Maintenance Loan from
the SLC will not allow you to borrow any when you first become eligible to repay your Student Finance Wales anytime between
further loans – for example: if you go on to loan. For students graduating in Summer the academic year 2010/11 and 2014/15 the
postgraduate study and apply for a 2020 the years will start to count from April Welsh Government could cancel up to
postgraduate loan. 2021. £1,500 from your student loan balance when
you start repaying.
Outstanding loans are cancelled if the
borrower becomes permanently disabled
or dies.
Plan 2 Loans (English and Welsh funded students with 2012 and later entry) The interest
rate varies according to circumstances and is based on RPI.
YOUR CIRCUMSTANCES INTEREST RATE
RPI 2.4% plus 3% Actual interest rate 5.4%
Actual interest rate between 2.4% and 5.4%
depending on income.
Income -
• £26,575 or less interest = RPI
• between £26,575 and £47,835 interest = RPI plus
up to 3%,
• over £47,835 interest = RPI + 3%
RPI + 3% will be applied to your loan whatever your
income until you contact SLC
04 05
National Insurance and Income If you are the only person liable for council tax Postgraduate loans provide a contribution to To book a face to face or telephone
in your home you should be eligible for a 25% the costs of tuition and living but are rarely appointment:
Tax when you start work discount. If you are on a low income and not enough to cover the full costs of undertaking
If you are starting work remember that a full time student you might be eligible for postgraduate study. • Phone 01509 222765
employers quote salaries as gross income help with your Council Tax through the
and do not account for tax and national benefits system. If you are a Loughborough student continuing • We can also offer you advice by email
insurance deductions. Use this calculator to on to a postgraduate programme here then on advice@lboro.ac.uk
see how much you are likely to take home
once these deductions are made.
Benefits the following resources might be helpful –
www.lboro.ac.uk/study/postgraduate • Call into the Bridgeman Building on
Benefits and tax credits have been www.lboro.ac.uk/services/doctoral-college campus (no. 53) during opening hours
When starting a new job make sure you take undergoing major changes over recent years
your P45 from any previous job whether with the introduction of Universal Credit to If you are starting a PhD your academic Even if you have left your course we will still
full- or part-time or ask the employer for a replacing a number of older benefits. department will be able to inform you of any help, and we remain open throughout the
‘Starter Checklist’ from HMRC, otherwise you scholarships that are available. summer vacation. However, if you have left
could be put onto an emergency tax code and If you are not immediately starting paid work Loughborough and have a problem with a
have too much money deducted from your you may wish to apply for Universal Credit. non-student issue, you will need to contact a
monthly salary. Banks and Building Societies
Universal Credit can be claimed from the local advice agency such as a Citizen’s
The special banking terms available to Advice.
day after your course finishes. So for 2020
If you have paid too much tax during the students (eg interest free overdrafts) will
you may be entitled to benefits from 18th
tax year (which runs from 6th April to 5th April eventually cease after leaving university.
each year), then you may be able to claim
June. You can start to make an application
Nevertheless, many banks have financial Useful websites
a week or two before, as it takes some time to
back tax you paid in that year. This is not packages aimed at graduates offering • https://www.gov.uk/repaying-your-student-loan
complete the process.
automatic so check your pay slips. For services on preferential terms. Several banks • www.moneysavingexpert.com/students/
straightforward tax refunds visit gov.uk.For allow you to retain a partial interest free student-loans-repay
As a general rule, do not delay in making
more help visit Tax Guide for Students. overdraft with the interest free element of the
any claim for Universal Credit. There are • www.moneysavingexpert.com/tax-calculator/
overdraft reducing over a period of a few
strict rules on how much can be backdated
years. Speak to your bank’s student adviser • www.gov.uk/government/publications/
Council Tax and in what circumstances.
to find out how they can help after you have
While you have been a student, if you lived in paye-starter-checklist
left your course. Always remember to • www.taxguideforstudents.org.uk/
a hall of residence or a dwelling solely For more information please see the
compare interest rates and charges on
occupied by students, there should not be a Citizens Advice website. • www.gov.uk/postgraduate-loan
graduate accounts, loans and overdrafts.
Council Tax bill.
• www.gov.uk/doctoral-loan
If you live off campus, Council Tax is
Postgraduate study Further help • www.gov.uk/universal-credit
calculated on a daily basis. Any relevant If you are planning to take a Masters course For further information/advice on this or any • www.adviceguide.org.uk/
change in your circumstances, such as when or a PhD, be aware that these courses do associated issue, even if you are a student
you move, or cease to be a student, can not qualify for the same student loans and living away from Loughborough, please
affect your liability. If you stay on in your grants that are available to undergraduates. contact Student Advice and Support.
student house from the end of the academic
year until graduation, you will be liable to pay Postgraduate Student Loans are available
council tax for the period between the end of to students who normally live in England,
term and the date you leave the property. Wales, Scotland and Northern Ireland for
Also council tax could be chargeable on your taught Postgraduate courses. The amount
house if you live with continuing students of loan, eligibility criteria and repayment
after you have left your course. terms vary according to the awarding body.
EU students may also be eligible for PG
It is also important to remember that you loans if starting a PG programme in 2020.
will be a non-student in between courses. The eligibility rules for EU PG students
If you complete your undergraduate degree are likely to change when the UK
and start a postgraduate course you will not be comes out of the Brexit transition period.
treated as a student over the intervening
period, normally the summer vacation and will
probably have to pay Council Tax.
06 07Members of AdviceUK, UKCISA, NHAS and regulated by
the Office of the Immigration Services Commissioner.
75194/CPS/April19 Updated April 19
Loughborough University @LboroAdvice
E: advice@lboro.ac.uk
For appointments phone: +44 (0)1509 222765 /Lborostudentadvice
Please contact us if you require this information in an alternative format.
All information and figures are correct at the time of writing but may be subject to changeYou can also read
