Income tax treatment of student loans deductions

Income tax treatment of student loans deductions

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Hi

I have to file a tax return of my client which have some self employments income and employment income.

At the P60 of my client there is student loan deductions during the year.

Do i need to consider student loan deductions at the time of preparing tax return?

What is the tax treatment of student loan deductions?

regards

Replies (7)

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By Paul D Utherone
03rd Jul 2014 17:43

Consider the entries on

the main tax return page TR5 at boxes 1, 2 & 3.

They are apparently in a position to be repaying the student loan and may have a further charge through the return based on total income including the self employed income.

Thanks (1)
RLI
By lionofludesch
03rd Jul 2014 18:24

Not allowable

They're not allowable for tax, if that's what you're getting at.

They don't affect the tax payable but the repayments are dependent on how much the creditor earns and are collected with the tax and Class 4 NI.

Thanks (0)
By Paul D Utherone
03rd Jul 2014 20:46

But they are a credit

against the calculated loan repayment charge.

So if the SL charge per total income in the return was £1,500 but the employer had deducted £1,000 that you entered in Box 2 on SA100-TR5 then the net SL charge entered i Box 2 on SA110-TC1 is £500

Thanks (0)
RLI
By lionofludesch
04th Jul 2014 08:37

Yes of course

You compare what you owe with what you've paid and send the difference. 

Just like tax and NI.

Thanks (0)
By Paul D Utherone
04th Jul 2014 12:36

Not disagreeing

just clarifying :)

Thanks (0)
RLI
By lionofludesch
04th Jul 2014 12:41

Not disagreeing

I'm not disagreeing either. Just clarifying.

Thanks (0)
By Paul D Utherone
04th Jul 2014 13:51

:p

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