MARTIN Lewis has warned millions of Brits could be owed money after paying the wrong amount in their student loan repayments.
The Money saving expert has urged anyone with an outstanding student loan to check if they have been paying the wrong amount.
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A freedom of information request he filed found that a million people overpaid their loans in 2022/2023 in that year alone.
He posted a video to social media earlier this week which he said “went viral” helping Brits with their loan repayments.
He’s now followed it up with a segment on his ITV show tonight explaining four ways that those with student loans could be paying the wrong amount and whether they could reclaim cash.
Lewis teed off on how loan repayments are communicated, referring to loans as a “graduate tax” that had become a “political football”.
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WRONG REPAYMENT PLAN
This problem affected 165,000 last year and hits those when they have been placed onto the wrong payment plan.
These thresholds are dependent on when and where you went to university and mark the income amount above which you begin repaying.
For those who went to uni between 1998 and 2011, that mark is £22,015.
But for those who went to university between 2012 and 2022 that figure rose to £27,295, meaning they get to keep more of their income.
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If your employer doesn’t have your correct details, then you may automatically be placed into the first threshold, meaning you pay more.
VARIABLE INCOME
You only need to pay your student loan if your annual income is above the threshold, but 833,000 people last year didn’t earn above the right threshold and paid too much back.
With a PAYE form of taxation, repayment errors can happen if your income is variable throughout the year but higher in some months than the annualised amount.
Despite actually earning less than the threshold over the year, as that one month averages out over a year above the threshold, you pay money on your loan back for that month.
This might happen when, for example, a bonus or if you worked more shifts than usual in one month.
MONEY DEDUCTED AFTER LOAN REPAYED
Loans are wiped after a set period, usually 30 years.
But, some continue to accidentally pay their loan due to administrative errors.
One thing holders can do is to pay the loan in their last two years by direct debit, meaning you can ensure you don’t pay over the timeframe.
EARLY REPAYMENT
Martin informed those with student loans they are only eligible to pay back from the April after they leave university.
“So, sometimes companies don’t know when you left university or they have the wrong details, in which case you start repaying when you shouldn’t be repaying,” he explained.
“And again, you can get that money back too.”
SHOULD YOU RECLAIM
The Money Saving Expert urged anyone who has overpaid to reclaim because these loans could be wiped after a certain amount of time.
Most people have 30 years but it depends on where you are in the UK and when you started university.
Only 20 per cent of people on the second plan, in England and Wales, are likely to clear their loan.
This means they’ll have money left in their accounts, meaning overpaying doesn’t reduce what you pay in the future.
HOW TO RECLAIM
Martin confirmed there is no time limit to reclaim an over payment.
The process will involve collecting old payslips, your payroll number and PAYE reference number.
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You will need to contact the Student Loans Company (SLC) on 0300 100 0611 (for Wales it’s 0300 100 0370 and +44 141 243 3660 from overseas).
But, Lewis said due to his social media post earlier in the week, a new form had been created called the SLC Refund Request form to help with demand which can be found online at gov.uk.
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