Postgraduate Loan Deductions

 

Since 6 April 2019, Postgraduate Loans are due for repayment through the PAYE process.

  • There are no separate plan types associated with a postgraduate loan, unlike student loans.

  • HMRC will notify an employer of when postgraduate loan deductions are to start for an employee via form PGL1.

  • HMRC will notify an employer of when postgraduate loan deductions are to stop for an employee via form PGL2.

  • Since the introduction of postgraduate loan deductions through the payroll, it may arise that an employee is liable to repay both a Student Loan type and Postgraduate Loan at the same time.This means that, where applicable, employers will have to deduct both Postgraduate and Student Loan deductions.




Thresholds for tax year 2020-21

 


Employer's Role

The employer is responsible for:

  • making deductions of postgraduate loan repayments from an employee's earnings

  • keeping records of the deductions made

  • paying the deductions over to HMRC

  • providing HMRC with details of the deductions within each FPS submission

  • giving an employee details of their deductions on their payslips and P60 certificate

  • on form P45, indicating if the postgraduate loan deduction should continue 

 

Deductions


Once an employee's income goes over the relevant threshold, the employer will deduct 6% of their income that's over the threshold towards repaying their loan.

 


Applying Postgraduate Loan Deductions in BrightPay

To access this utility, simply go to ‘Employees’ and select the employee’s name on the left:

1) Click on the Tax/ NICs/RTI heading

2) Select the drop down arrow for 'Postgraduate Loan' and choose Deduct Postgraduate Loan repayments






3) Enter a start date and stop date, if known

4) Click Save Changes


The payroll software will now automatically calculate and apply the appropriate postgraduate loan deduction as per the current Postgraduate Loan Deduction Tables. 

  


Quick Edit for Postgraduate Loan Deductions

A quick-edit facility for postgraduate loan deductions can also be found in ‘Payroll’:




 

1) Select the employee’s name from the listing

2) Click Edit Settings at the top right of the employee's payslip

3) Within Tax/NIC Details, select the drop down arrow for 'Postgraduate Loan' and choose Deduct Postgraduate Loan repayments

4) Enter a start date and stop date, if known

5) Click Save

 

Need help? Support is available at 0345 9390019 or support@brightpay.co.uk.

BrightPay Licence Terms and ConditionsCoronavirus (Covid-19) - Guidance for BrightPay usersImportant Information for Mac UsersBureau Enhancements - Useful Functionality for Bureau Licence HoldersInstalling BrightPayOrdering for The New Tax YearImporting From The Previous Tax YearMoving to BrightPay from another payroll softwareEmployer DetailsEmployee DetailsCoding NoticesPayroll CalendarProcessing PayrollImporting Pay Data using CSV FileRTICommon HMRC Error MessagesAnalysisPayroll JournalsHMRC PaymentsMaking Corrections to PayrollScheduling Future PaymentsSwitching an Employee's Pay FrequencyDirectorsStartersLeaversStudent Loan DeductionsPostgraduate Loan DeductionsStatutory PaymentsAttachment of EarningsExpenses & BenefitsPensions (outside of Automatic Enrolment)Payroll GivingYear EndRates & Thresholds at a GlanceTaxNational InsuranceNational Minimum/Living WageMileage Allowance Payments (MAPs)Employment AllowanceApprenticeship LevyTermination Awards & Sporting TestimonialsOff-Payroll Working in the Public SectorGender Pay Gap ReportingLeave Reporting & Employee CalendarAnnual LeavePayslip TranslationsBacking Up/Restoring Your PayrollConstruction Industry Scheme (CIS)Automatic EnrolmentBrightPay ConnectGDPR