11 Jul Do you have employees with Student Loans?
Do you have employees with Student Loans?
With more and more young people attending Universities it’s quite likely that sooner or later you will employ someone with a student loan.
Your first points of reference are the following websites:
- Find out about your responsibilities as an employer and how you manage repayments
- Checking which Plan your employee/Student is on the Student Repayment Checker here
Mandatory box for student loan plan types
Hopefully if you are using payroll software it should now have been updated to include a new student loan plan type box on the Full Payment Submission (FPS) you send to HMRC.
This box is mandatory. It needs completing for all employees who have a Student Loan. You should select either plan 1 or plan 2 depending on your employee’s Student Loan plan type.
Student Loan Generic Notification Service (GNS) messages
As an employer, you may receive two different types of Student Loan GNS messages to your HMRC PAYE on-line inbox.
These GNS messages will instruct you to do one of two things:
- start taking Student Loan deductions from a named employee from their next available pay day and report this on the next FPS you send to HMRC. This is sent when HMRC receives an FPS showing zero Student Loan deductions for an employee they know has a Student Loan.
- include the correct Student Loan plan type for a named employee on the next FPS you send to HMRC. This is sent to them when HMRC receives an FPS for an employee showing the incorrect plan type.
If the above GNS messages are not actioned on the next FPS submitted for the named employee(s) a second GNS message will be issued. If this is not acted upon, HMRC may contact you by telephone.
Student Loan thresholds for the tax year 2018 to 2019
The Student Loan thresholds for the tax year 2018 to 2019 are:
- plan 1 £18,330 annually
- plan 2 £25,000 annually.
Remember to check and operate the correct plan type when you set up Student Loan deductions for an employee. You will find the plan type information on form SL1, the starter checklist or by asking the employee. If the employee does not know their plan type, they can check the Student Loan webpages here.
More information on student loans for employers can be found on the GOV.UK webpages Student Loan repayments: guidance for employers.
Outsource to EA Assist Ltd
If that all sounds a bit complicated why don’t you outsource your payroll to EA Assist. We offer a full payroll service that is linked to HMRC online portal, to fully automate al new student loan and tax code notifications and ensure you comply.
Whether you have 1 employee or 100 we can run your payroll using the latest software and ensure you file your payroll submissions accurately and on time to avoid penalties.
Contact us now for more information on 01379 646943.