UK Student Finance

[UpsidedownKev]

Hello,

 

Myself and my girlfriend have just moved to Sydney. She has a student finance loan that we would like to pay off, and we are looking for the best way to do this.

Has anyone recently had the same issue with a loan issued after 1998 and before 2012?

She earns over the UK threshold for Oz workers.

Can we pay into an Aussie account, and can we claim the tax back on this or have it taken pre-tax as we would in the UK?

The worry is that we have to pay 295 pounds a month (minimum payment) after tax and after financial exchange rates. 

Any help would be greatly appreciated.

 

[Guest The Pom Queen]

Welcome to the forum. Sorry I'm half asleep this morning. Are you in Sydney and returning to the UK, is the student loan from Australia or the UK

[SUPERSTARDJ01]

We looked into this you can ask for 1yr break in payment while you get set up down under giving you time to save, you could always pay the money to a paypal account and withdraw it to a uk account then pay the student loan company avoiding transfer fees.

Sent from my LG-H850 using Tapatalk

[Ken]

9 hours ago, SUPERSTARDJ01 said:

you could always pay the money to a paypal account and withdraw it to a uk account then pay the student loan company avoiding transfer fees.
 

Apart from the hefty transfer fees and wide FX spread that paypal charges of course.

[SUPERSTARDJ01]

Paypal only charge if using a credit card or paying for goods all you'd be doing is paying family or friends using a debt card its free

[newjez]

On 10/04/2017 at 4:03 AM, UpsidedownKev said:

Hello,

 

Myself and my girlfriend have just moved to Sydney. She has a student finance loan that we would like to pay off, and we are looking for the best way to do this.

Has anyone recently had the same issue with a loan issued after 1998 and before 2012?

She earns over the UK threshold for Oz workers.

Can we pay into an Aussie account, and can we claim the tax back on this or have it taken pre-tax as we would in the UK?

The worry is that we have to pay 295 pounds a month (minimum payment) after tax and after financial exchange rates. 

Any help would be greatly appreciated.

 

Why would you want to do this?

[doubter]

5 minutes ago, newjez said:

Why would you want to do this?

I was thinking the same just leave it there and don't tell them even though they would like to know.It gets written off after about 30 years anyway

[Ken]

6 minutes ago, SUPERSTARDJ01 said:

Paypal only charge if using a credit card or paying for goods all you'd be doing is paying family or friends using a debt card its free

No.

Sending money to friends and family.

Within Australia

Sending Australian dollars to Australian PayPal accounts

Using your PayPal balance or linked bank account Free

Using your credit or debit card 2.4% + $0.30

Overseas

A currency conversion fee may apply to either the sender or recipient.

Using your PayPal balance or linked bank account From 0.5% - 3.3%, depending on the country

Using your credit or debit card From 3.9% - 7.4% plus a fixed fee, depending on the country

 

Currency conversion fees

 

To US or Canadian dollars	3.5% above the exchange rate
To all other currencies	4% above the exchange rate
Within your PayPal account (not as part of a purchase) to any currency.	2.5% above the exchange rate

 

[SUPERSTARDJ01]

Fair enough but also be warned student loan never gets written off and its a government debt so they can and will chase you overseas and can take you to coury in australia.

[newjez]

15 minutes ago, SUPERSTARDJ01 said:

Fair enough but also be warned student loan never gets written off and its a government debt so they can and will chase you overseas and can take you to coury in australia.

UK student debt gets written off after thirty years.

My son is thinking of doing architecture. Six years degree with living expenses, he will never pay off his debt. It will simply expire.

[llessur]

There's some info on this thread:

 

https://www.pomsinoz.com/index.php?/topic/49381-Student-Loans

 

It's a couple of years old but still relevant.

 

You'll likely find that you'll be liable to pay significantly more than you would have been doing via PAYE back in the UK - the exchange rates and cost of living calculations used by the SLC don't tend to work in your favour (although on the plus side you'll pay the loan off sooner).

 

Whilst the SLC can be a nightmare to deal with (refer to other thread) if the calculated repayments are too high then people have had success in asking them if a lower amount can be paid.

 

Whilst many people do just ignore the debt when moving overseas, I personally wouldn't as I have read that the UK and Australian governments will be cooperating more closely on unpaid student loans in future so it is entirely possible that they could chase you for the money over here. That'll be after they've applied penalty fees and moved you over to a commercial interest rate as per their T&Cs on non payment. Even if they don't catch you over here, because it's technically a Government debt, next time you head back to the UK they can stop you at the airport and prevent you from leaving until payment arrangements are made.

 

That's if they can pull their fingers out and find you of course. Up to you as to whether you want to take the risk...

 

One thing to bear in mind if that their overseas payment assessments are valid for a year - if you've only just arrived and are ​currently not working and can prove you're living off of savings then it might be worth getting an assessment now as you'll not be liable for payment for 12 months. Or, as someone said above you could ask for a year's grace period - haven't heard of that before but it could work. Of course they might just say no...

 

Oh, and payments aren't pre-tax or PAYE over here as there's no system to do that, nor are they tax deductable. You'll need to either pay manually every month using a debit card over their website or set up a direct debit from a UK bank account. I think some people get a credit card with zero fees on international purchases specifically for this but my opinion is they just stick you with less competitive exchange rates - they get their money one way or the other.

 

Also, the minimum payment amounts listed on the SLC website relate to the default payment amount that will be applied if you go AWOL and they eventually catch up with you. If you keep in touch with them then they'll calculate a payment amount based on your salary (hence my comment above about getting an assessment done now if you're not earning very much yet).

 

All in all it depends on how long you plan to be over here. If you're only here for a couple of years then sod it and just get back in touch when you get back to the UK. If you're here permanently then it might work out easier in the long term just to make arrangements to pay it off monthly.

 

 

 

 

 

[UpsidedownKev]

We looked into this you can ask for 1yr break in payment while you get set up down under giving you time to save, you could always pay the money to a paypal account and withdraw it to a uk account then pay the student loan company avoiding transfer fees.

Sent from my LG-H850 using Tapatalk

This is really good info thank you.

How did you contact them to ask?


Sent using Poms in Oz mobile app

[nicolac34]

If she has updated the SLC with her new Australian address they will post you out a form to complete in which you declare your income and provide proof (contract and 3 months payslips). Send this back and they'll write back letting you know what your payment schedule is. It is significantly higher than she would pay if in the UK, but you can negotiate this down - just write back to them (snail mail unfortunately unless you use fax) and say you can't afford the higher repayment and offer to pay something else.

I did this when they wanted me to fork over £364 a month - I negotiated it down to £200.

To make payments I used an Australian credit card that doesn't charge foreign transaction fees (mine was Bankwest Zero transaction one but there are others). Each month I'd log onto the SLC website and make the required payment.

The SLC will chase you if you don't pay. They've become much more switched on to people going abroad and defaulting. 

If you can I'd pay it off as soon as you can, the exchange rate fluctuating was crap for us. If we'd paid it off when we first arrived it would have cost us $3k less than it ended up doing.

Thankfully we've both paid off our loans now and have no reason to constantly check the exchange rate!

[Penny88]

My partner and I moved to Melbourne in August last year and by Feb a request and a subsequent reminder had been sent to my parents address requesting my income details (I never notified them I was moving abroad). In the end I just filled in the assessment form (had been in work in Melbourne since the October) as I didn't want to get slapped with the £295 per month charge for not submitting. I'd say they are definitely a lot more switched on now about people leaving the country with student debt still owing!

Interestingly, my repayments in £'s are actually lower under the Australian calculation they do, than they were when I was in the UK on a very similar salary.