Have you overpaid your Student Loan?

overpaid student loan payments

Over the last decade, 510,000 people have continued to make payments to the Student Loan Company after their debt has been paid off. Are you one of them?

You are? Well, the good news is that you can get this money back from the Student Loans Company (SLC).

How much money is involved in Student Loan overpayments?

Between 2009 and 2018, the SLC received total overpayments of £308m. That’s an average of £600.00 for each of the 510,000 former students. To date, £28m of this has still not been paid back.

Why have so many people overpaid?

There are two main factors that have led to this Student Loan overpayment situation. A combination of individuals’ lapses in personal admin and the fact that the SLC’s payment updates are only once a year.

SLC payment update

The Student Loans Company monitors their accounts in April, at the end of the tax year. So, if you paid off your loan in the previous May and didn’t cancel your direct debit, you’ve overpaid by ten months before the SLC notices.

The Student Loans Company do not want this extra money sitting in their bank account. So, as soon as such a discrepancy is discovered, they attempt to inform their customers. They want to tell people they have overpaid and how to reclaim their money. And this is where the lapses of personal admin come into play.

Personal admin

The SLC cannot get in touch with you if they do not have your correct details. You need to make sure the Student Loans Company is on your list of ‘people to inform’ when you move home or change your email address. This is entirely the responsibility of the individual. You must keep the SLC updated with current contact details, they can’t do that for you.

Why don’t people reclaim their Student Loan overpayments?

There are several reasons why people don’t reclaim their SLC overpayments:

  • they don’t know they’ve overpaid
  • they don’t understand the rules about reclaiming
  • the process of making a claim is too off-putting
  • assuming that the money will eventually make its way back into their bank account without having to do anything

Let’s just tackle that last one quickly. The Student Loan Company cannot make an automatic repayment into your bank account. You have to make an official claim, following the correct procedure.

As far as the other factors go, it is both common and understandable that people are wary of tackling financial matters. And given the size of the debt, it’s very easy to forget that you will eventually pay it off entirely. Keeping track of your payments, communicating new contact details to the SLC and getting advice when necessary are all your own personal responsibilities.

Now I’ve read this, I think I’m due an SLC refund. What should I do?

You may have a sneaking suspicion that you are owned a refund from the SLC, but you haven’t heard from them. As we’ve explained, this could be because they have only got your old address or because your overpayment will be highlighted at their next annual accounts review. You don’t need to wait for them to get in touch. Give them a call and get the ball rolling. That’s what they’re there for.

If we help you sort this out, we’ll also suggest looking at your current financial situation to see if you can benefit from any work expense allowances or tax reliefs. This is another area where lack of knowledge sees thousands of taxpayers missing out on the claims they are fully entitled to. Don’t let that be you.

At the same time you can use our free money guides and calculators to support you with personal loans, saving options, residential mortgages and credits cards.

Through the money advice service there’s also a money health check and our handy tax guide if you are thinking about becoming self employed.


Tony Shanks
Operations Director
Member of the ATT

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