HMRC tax error sees thousands overcharged on student loans

06 Oct 2023

An error in payroll software used by HMRC has caused thousands of individuals to overpay on their student loans.

The error saw £1.6 million taken from 16,000 workers between 2016 and 2023, totalling around £104 each. Those affected earn over £100,000 or operate as sole traders and claim benefits-in-kind.

According to HMRC, its payroll software should've automatically ignored benefits on which workers don't pay national insurance, but the software included them in student loan calculations by mistake.

HMRC stated that it is writing to graduates to inform them that they will be repaid via their student loan accounts and that a temporary solution has been put into place for the remainder of this tax year.

Around £20 billion is loaned per year to 1.5 million students in England. At the end of March, the value of outstanding loans was £206 billion.

Copyright

© 2024 Michael Letch & Partners LLP. All rights reserved.

We use cookies on this website, you can find more information about cookies here.
Contact Us

Please call:
01277 655 626

Quick links

Home | Contact us | Site map | Accessibility | Disclaimer | Privacy | Help |

Address
Michael Letch & Partners LLP, 146 High Street, Billericay, Essex CM12 9DF

Michael Letch & Partners LLP is a limited liability partnership registered in England and Wales with registration number OC328815.

Michael Letch & Partners LLP is also regulated by the Financial Conduct Authority to carry out specific activities and investment advice (registration number 112064).

The term ‘Partner’ is used to refer to a member of Michael Letch & Partners LLP. A list of members is open to inspection at our registered office at 146 High Street, Billericay, Essex, CM12 9DF.

Michael Letch & Partners LLP is registered as auditors in the United Kingdom by the Association of Chartered Certified Accountants