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How do I adjust my tax return if I've just paid off my student loan?

Article ID: 2159
Last updated: 07 Feb, 2017

In the final year of repaying a student loan, an additional liability will often become due for a portion of the year where the loan has already been paid back in full. This is because HMRC applies the calculations of repayments to the whole year, even if the loan was repaid part way through the year.

You can't amend the calculations on your tax return because they must match the HMRC calculations to pass online submission. Instead, a manual adjustment will be made to your HMRC account after submission.

Tell HMRC if you've nearly paid off your loan

You should let HMRC know when you're within the last two years of student loan repayments via your tax return. The Student Loans Company will tell HMRC what the actual remainder was and adjust your tax bill accordingly.

SimpleStep mode

  1. Go to Working out your tax.
  2. Tick the box for If you believe the loan will be fully repaid within the next two years please tick the box?

HMRC Forms mode

  1. Go to: SA100 Core Return > Page 5.
  2. Tick box 3. 

We recommend that you also ask the Student Loans Company how long the adjustment will take and if it will be before the total tax payable is due with HMRC (31 January).

If the payment is received in time, the Student Loans Company will credit the amount overpaid towards the tax due to balance the account on HMRC.

For more information on how to reduce the tax due amount, read our KB article on Where do I enter any credit already on my HMRC account?

PLEASE NOTE: HMRC doesn't deal with student loan enquiries. Contact the Student Loans Company directly.

Article ID: 2159
Last updated: 07 Feb, 2017
Revision: 10
Views: 2249
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