In order to show support towards higher education, the UK Government’s Department of Education established Student Loans Company in 1989, in order to facilitate students studying in the UK. According to recent data, the SLC provides an estimate loan of £17 billion to 1.3 million students every year.
Students can ask for a loan from respective government to bear burden of their academic expenses. But, of course, different terms and conditions apply to these loan policies as they vary according to the amount demanded or according to the academic step. A student shall repay the loan only if his/her income exceeds the threshold amount (set at £27,295 every year) of their plan.
The first payment shall be made in April after completing his course or four years after the study started. The threshold amount changes on 6th April every year; if the income is below the threshold amount, the student might not have to pay for the adopted plan.
“A student shall repay the loan only if his/her income exceeds the threshold amount of their plan.”
Don’t keep your hopes high but, there is a sigh of relief for low-earning graduates as student unions in UK have asked the education minister Gavin Williamson, and Michelle Donelan the universities minister to rebate 30% tuition fee this year by increasing the interest rate from 3% to 6.2% in response to the COVID-19 atrocities. Unfortunately, this demand will directly affect the high-earning graduates as they already pay more on their student loans.
Why should someone get off their path due to financial issues when there are repayment loan plans to help them? By creating an account and following the set guidelines, a student can easily make it all to the end. The following calculations are made before considering tax and other deductions. If you are having difficulties in understanding the below-mentioned plans, you can ask for help from expert accountants.
“Why should someone get off their path due to financial issues when there are repayment loan plans to help them?”
According to the UK government the loan repayment plans are as follows:
You are on Plan 1 if you are:
- An English or Welsh student who started his/her undergraduate anywhere before September 2012 in UK.
- Northern Irish student who began an undergrad or postgraduate course anyplace in the UK on or after 1 September 1998
- An EU student who started an undergraduate course in England or Wales on or after 1 September 1998, but before 1 September 2012
- An EU student who started an undergraduate or postgraduate course in Northern Ireland on or after 1 September 1998
“You can only repay if your income is over £1,657 a month.”
You are on Plan 2 if you are:
- An English or Welsh student who started an undergraduate course anywhere in the UK on or after 1 September 2012
- An EU student who started an undergraduate course in England or Wales on or after 1 September 2012
- Someone who took out an Advanced Learner Loan on or after 1 August 2013
“You can only repay if your income is over £2,274 a month.”
You are on plan 4 if you are:
- A Scottish student who started an undergraduate or postgraduate course anywhere in the UK on or after 1 September 1998
- An EU student who started an undergraduate or postgraduate course in Scotland on or after 1 September 1998
“You can only refund if your income is over £2,083 a month.”
You are on a Postgraduate loan plan if you are:
- An English or Welsh student who took out a Postgraduate Master’s Loan on or after August 1, 2016.
- An English or Welsh student who took out a Postgraduate Doctoral Loan on or after August 1, 2018.
- An EU student who started a Postgraduate course on or after August 1, 2016
“You can only refund if your income is over £1,750 a month.”
You might wonder, how to pay-off your loan after receiving a statement from Student Loan Company (SLC). In such case, it is prudent to pay your student loan payments on time because you might be repaid for your;
- Tuition Fee Loans
- Maintenance Loans
- Postgraduate Loans
You have to create a Student Loan Repayment Account. Sign in to check various features regarding when to pay the next instalment or how much is left unpaid. You can also calculate the interest that HMRC applies to your loan amount.
You can update your personal information as well, like updating your phone number or email. The Student Loan Company (SLC) must get your latest news. To sign in, you will require
- Customer reference number or email address
- A secret answer
You have to repay the loan once the threshold amount is crossed. Interest in each plan is different according to the difference in amount.
- You pay 9% of the exceeded amount for plan 1, 2 and 4
- You repay the loan by submitting 6% of the exceeded amount for the Postgraduate Loan Plan.
Treasury department is considering a rise in Student Repayment Loan or an extension in the loan repayment plan. Keep your fingers crossed, sign in to your account and check the latest updates by visiting the official sites. Maintain your balance on the track and study to conquer your personality. Nothing can stop you in achieving your goals if you are consistent and determined. Because these plans, set by the UK government are there to make your future secure!