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Student Loan and Postgraduate Loan

Summary

Student Loan and Post Graduation Loan details determine the loan deductions applied during a pay cycle. Payroll calculates these deductions using the employee’s loan plan, loan dates, earnings, pay frequency, and financial year.

The deductions appear in Salaries, while Student Loan totals are also included in the FPS.

In this article

  • Before you begin
  • Setting or importing loan details
  • Viewing deductions on the pay cycle
  • How the deduction is calculated
  • Viewing Student Loan on FPS
  • Frequently Asked Questions (FAQ)

Before you begin

You must have an active Payroll add-on to access and use Payroll features.

You need:

  • Company Money access
  • View Pay Schedules
  • Start Payrun
  • Access to the person’s payroll tax information or Payroll Update Details to update tax details

To import loan information, use the Tax and Bank Details import.

Student Loan Start Date is required when Student Loan is not set to None.

Off-payroll workers do not receive Student Loan or Postgraduate Loan deductions.

Make sure the correct Fin Year is set on the tax record. Loan thresholds and rates are stored according to:

  • Financial year
  • Monthly
  • Weekly
  • Biweekly

Setting or importing loan details

Student Loan and Post Graduation Loan information is held in the person’s payroll tax details.

Student Loan

The available options are:

  • None
  • Plan Type 1
  • Plan Type 2
  • Plan Type 4
  • Plan Type 5

When Student Loan is not None, the Start Date is displayed.

Start Date

Start Date is required when Student Loan is not None.

End Date

End Date is available on the form but is optional.

Payroll uses the End Date when checking whether the pay cycle’s payment date falls within the loan period.

Post Graduation Loan

The available options are:

  • Active Loan
  • None

When Active Loan is selected, Start Date and End Date fields for the postgraduate loan are displayed.

Importing loan details

The Tax and Bank Details import includes:

  • Student Loan
  • Student Loan Start Date
  • Student Loan End Date
  • Post Graduation Loan
  • Post Graduation Loan Start Date
  • Post Graduation Loan End Date
  • Student Loan Paid
  • Postgrad Loan Paid

If Student Loan is not None and the Start Date is missing, Plumm displays:

The Student Loan Start Date is a required field.

Student Loan Paid and Postgrad Loan Paid are year-to-date starting amounts. They are not the deductions for the current pay cycle.

The validation:

The field Student Loan must be a number.

applies to the year-to-date Student Loan Paid value rather than the Student Loan plan type.

Viewing deductions on the pay cycle

Open Company Money > Pay Schedules.

Open the required schedule and select Start Pay run or Continue Pay run.

Open Salaries > Deductions.

Student Loan on the grid

The Student Loan column displays the Student Loan deduction for the current cycle.

If the deduction is 0, Plumm displays a minus icon instead of £0.00.

Student Loan and Postgraduate Loan on the sidebar

Open the employee from the Deductions grid.

The deductions sidebar displays:

  • Student Loan
  • Postgraduate Loan

Both fields are read-only.

The amounts are included in Total Deductions.

Review

On Review, the cost breakdown uses the labels:

  • Student Loans
  • Post Graduation Loans

On a completed pay cycle, Pay Cycle History Deductions displays:

  • Student Loan
  • Post Graduation Loan

If you change the person’s tax or loan details after opening the pay cycle, return to Updates and select Recalculate.

How the deduction is calculated

Payroll does not apply Student Loan or Postgraduate Loan deductions to an off-payroll worker.

Student Loan

Payroll applies a Student Loan deduction when all the following apply:

  • Student Loan is set to a plan type rather than None.
  • The cycle payment date is on or after the Start Date.
  • The cycle payment date is on or before the End Date.
  • Earnings used for the loan are above the relevant threshold.

The threshold depends on:

  • Student Loan plan
  • Pay frequency
  • Financial year

Pay frequency can be Monthly, Weekly, or Biweekly.

Payroll calculates the amount using the earnings above the applicable threshold and the Student Loan rate for that financial year.

The resulting deduction is rounded down to whole pounds.

Each Student Loan plan has its own threshold. The applicable rates and thresholds come from the UK Student Loan table for the financial year and are not entered manually against the person.

Postgraduate Loan

Payroll applies the Postgraduate Loan deduction when:

  • Post Graduation Loan is set to Active Loan.
  • The payment date falls within the postgraduate loan Start Date and End Date.
  • Earnings are above the postgraduate threshold for the relevant pay frequency and financial year.

Payroll calculates the amount using earnings above the postgraduate threshold and the postgraduate rate.

The resulting deduction is rounded down to whole pounds.

Student Loan and Postgraduate Loan are calculated separately, so both deductions can apply during the same pay cycle.

If earnings are below the applicable threshold, the deduction is 0.

Viewing Student Loan on FPS

After Process Pay Run, open the FPS for the required period.

Under Totals, Plumm displays:

  • PAYE
  • Student Loan
  • Employee NICs
  • Employer NICs

Student Loan is the total Student Loan deduction included in that FPS submission.

The FPS Totals section does not display a separate Postgraduate Loan line.

The HMRC Full Payment Submission (FPS) is submitted as part of Process, or it can be submitted later from the FPS page using Submit FPS when you have the required permission.

Frequently Asked Questions (FAQ)

  • Why is Student Loan zero?
    Student Loan may be set to None, the payment date may fall outside the Start Date and End Date, earnings may be below the applicable threshold, or the person may be an off-payroll worker. After correcting tax details, select Recalculate on Updates.
  • What is the difference between Student Loan and Postgraduate Loan on the sidebar?
    Student Loan uses Plan Type 1, 2, 4, or 5. Postgraduate Loan is the separate deduction associated with Active Loan under Post Graduation Loan. Both amounts are calculated separately.
  • Why do some screens say Post Graduation Loan and others say Postgraduate Loan?
    These are the labels used in Plumm. Tax details and imports use Post Graduation Loan, the pay cycle deductions sidebar uses Postgraduate Loan, and Review uses Post Graduation Loans. Follow the label displayed on the screen you are using.
  • Can I enter the deduction manually on Salaries?
    No. Student Loan and Postgraduate Loan are read-only on the deductions sidebar. Update the relevant plan, dates, or earnings source data, then select Recalculate.
  • Can Student Loan and Postgraduate Loan both be deducted in the same pay cycle?
    Yes. They are calculated separately, so both can apply when their respective conditions are met.
  • Does FPS Totals include Postgraduate Loan?
    The Totals section on FPS Details displays Student Loan only. A separate Postgraduate Loan total is not displayed.