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'I claimed back £1,100 after overpaying my student loan in FOUR different years'

'I claimed back £1,100 after overpaying my student loan in FOUR different years'

A graduate was able to claim back almost £1,100 from the Student Loans Company after reading MoneySavingExpert.com's guide and discovering she'd overpaid for four years – and she says the money will be vital to her while she's between jobs.

Michelle (pictured right – she asked us not to use her second name) from County Durham has worked as a supply teacher since 2014. Because of the fluctuating income that comes as part of the job, she ended up paying a total of £1,096 towards her student loan over four different tax years, even though each year she earned less than the threshold at which repayments are taken.

Usually student loan contributions are taken when you're paid – whether this is weekly, monthly or otherwise. So you repay when your earnings go over the equivalent of the annual repayment threshold for your pay period, eg, if you're paid monthly, you'll pay back your loan every month your pay goes over the monthly equivalent of your repayment threshold.

However, if over the course of a tax year (which runs from 6 April to 5 April) your total income is less than the threshold, you can reclaim. This was what happened in Michelle's case in four separate years, which was why she was able to get her money back.

We've help below on how to check if you've overpaid, and how to reclaim if you have – but for full info, including other reasons you may have overpaid your loan, see our Student Loan Overpayments guide.

How Michelle got her refund

Michelle first found out about student loan overpayments after a friend suggested she read a different article on the site. While reading that, she spotted our Student Loan Overpayments guide.

Having worked as a supply teacher for several years, Michelle had been paid each month by a supply company via PAYE, but her pay packet fluctuates throughout the year depending on how much work she did.

She said: "I'd work full-time for long periods and then I'd not work for a bit, so I thought I might be eligible to reclaim. I looked into my payslips myself first and noticed that in the 2014/15 tax year I'd only worked September to March, so I'd paid back but hadn't earned over the threshold.

"I then rang the Student Loans Company and spoke to someone on the phone – it was really simple. They confirmed all the years I was owed for and said the money would be in my account within six working days.

"I'm not working and I'd rather have the money even though I understand it'll go back on my loan. I'm meant to be starting a new job later this year and this money that I'm getting back will really tide me over to then, especially with buying Christmas presents and stuff."

The table below shows how much she reclaimed in each tax year:

Michelle's reclaims

Year Amount overpaid and reclaimed
2014/15 £193
2015/16 £248
2016/17 £330
2017/18 N/A
2018/19 £325
2019/20 N/A

Why was Michelle able to reclaim?

It's possible to repay too much of your student loan for several reasons – if you end up falling under the annual repayment threshold, if you continue repaying after your loan's paid off or if you repay your loan too early. We've full help on all these in our Student Loan Overpayments guide, but in Michelle's case the issue was that she was under the annual repayment threshold.

You usually overpay for this reason if your earnings vary throughout the year, so at one point you're earning an amount above the repayment threshold, but your total annual income is less than the threshold. This might happen if:

  • You only work for part of the year.
  • You take on extra shifts in a specific month.
  • You move to a higher or lower paid role.
  • You earn a bonus which puts you over the threshold for that month only.
  • You go on maternity or paternity leave for part of the year.

If over the course of a tax year (which runs from 6 April to 5 April) your total income is less than the threshold, you can reclaim. The annual thresholds vary depending on when you started your course and where you lived before university, and you repay 9% of what you earn above the threshold:

  • Started uni in or after 2012 and from England or Wales? The current threshold is £26,575/year. In 2017/18 it was £21,000/yr, in 2018/19 it was £25,000/yr, and for 2019/20 it was £25,725/yr.

  • Started uni between 1998 and 2011 (or since and from Scotland or Northern Ireland)? The threshold for 2020/21 is £19,390/yr, though the threshold's risen each year since 2012 – see a list of the different thresholds.

How to check if you've overpaid your loan – and reclaim

If you think you've overpaid, log on to the online repayment service to check. There you can find annual statements showing the repayments made each year – go to the 'View correspondence' section of your account.

If you believe you've overpaid, you need to ring the Student Loans Company on 0300 100 0611 (or +44 141 243 3660 from overseas), explain your situation and ask to reclaim the money you're owed. The phone lines are open at the moment but remember they may be busier than usual, as students have just returned to university.

There's no deadline to claiming – you can go back as far as you need to. But if you're claiming back money because you didn't earn over the threshold in a particular tax year, you'll need to wait till that tax year is over. If you do find you're owed and successfully reclaim, let us know at news@moneysavingexpert.com.

Should you reclaim if you've overpaid?

Of course, if you reclaim money, the amount you reclaim will be added back to your student loan balance, and of course interest is also charged. But despite that, in most cases it IS still worth reclaiming now.

Many students – especially those in England and Wales who started uni in or after 2012, who have 'plan 2' loans – are unlikely to repay their loan in full before it's wiped. Those with 'plan 1' loans – all students who started between 1998 and 2011, and students in Scotland and Wales since then too – are more likely to clear all their debt, but even then there's a cashflow boon to reclaiming now and it may be worth using the money to clear other more expensive debts first.