Pension v repayment of Student finance

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marple
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#21
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#21
(Original post by fbacc)
I don't believe it is the first £2,000 per annum which is ignored. Rather that if the pension income is below £2,000 pa then it is not taken into account. However if it is above £2,000 then it is ALL taken into account. So this threshold could have a significant impact around that monthly level. It could be more cost effective to take a lower pension if at the £2,000 threshold if possible.
I think you're correct, and my initial reading was wrong, sorry. This seems pretty clear:

https://www.taxguideforstudents.org....ect-repayments

https://www.gov.uk/hmrc-internal-man...nual/cslm16035
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Firewood1
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(Original post by marple)
I think you're correct, and my initial reading was wrong, sorry. This seems pretty clear:

https://www.taxguideforstudents.org....ect-repayments

https://www.gov.uk/hmrc-internal-man...nual/cslm16035
Aha, £2000 of pensions that are more than £2000 are not exempt from the student loan liability. However, the matter becomes even more complicated as the HMRC states that:


...Take into account the total amount of unearned income. The first £2000 is not exempt...
...Unearned income is included only if a statutory return has been issued to the borrower...
...Do not create an SA record solely for Student Loan purposes. Do not restrict a repayment of tax to account for Student Loan liability if, exceptionally, no return has been submitted....


My reading of it is that if a person does not trigger self-assessment, then HMRC does not bother collecting student loan payments from the person's unearned income whatever the income. For the best of my knowledge, receiving a pension per se does not trigger self-assessment.
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