Sarah Offord
Chartered Management Accountant
Midas Accountancy
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Student Loans

Student Loans

My client and his wife run a limited company and are both directors and shareholders. They take a minimal salary (£7k) and the rest as dividends. They both have considerable student loans outstanding. Clearly there will be student loan repayments due on the dividends in excess of the £15k earnings limit, however if I get their tax return in nice and early (2012-13 the previous year has already been done) can this be deducted through their tax code for 2012-13? I don't know if it would be easier for the client, I'm just checking there are't alternatives to suggest.

Many thanks in advance for any advice.



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By K81
06th Feb 2012 14:32

student loan

I assume that you are asking if the underpayment can be coded.

If your client's PAYE income is less than the personal allowances then HMRC will not code any underpayments. If your clients increase their salary to cover this point please bear in mind that HMRC will not code underpayments that more than double the tax liability.




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