If your employees have a student loan to repay, you’ll need to find out what date they went to university. This now matters because the amount of money they repay will depend on the size of the loan.
There are two student loan repayment plan types, known as Plan 1 and Plan 2.
Plan 1 is for:
- English and Welsh students who started studying before 1 September 2012
- All Scottish and Northern Irish students
Repayments start when your employee earns over £17,495. This amount changes on 6 April every year.
Plan 2 is for:
- English and Welsh students who started their studies on or after 1 September 2012.
They start repaying when they earn over £21,000.
From March 2016 the SL1 start notice issued by HMRC will show which student loan plan type you should make deductions against.
You’ll need to ask new employees which Plan they have when they fill out a new starter form.