Employers – New type of Student Loan Launches

A new type of student loan has been launched and from April 2019 you may receive a start notice PLG1 from HMRC asking you to make loan repayment deductions through PAYE. Your payroll software should be updated soon so that it will calculate the deductions for you. The following information will break it down for you.

New type of loan

A new student loan product known as postgraduate loans (PGL) has been launched. The earliest customers can start repayment of a PGL is April 2019 and so you might receive notifications about deductions you need to make from employees’ wages after that.

New forms

Where an employee has a PGL HMRC will send a start notice (PGL1) asking you to make deductions. It will send a postgraduate stop notice (PGL2) when it wants you to stop.

Note: You might also be required to make student loan deductions under the existing plans, Type 1 or 2 as well as those for the PGL.

Payroll software

HMRC is working with software providers so that your payroll program will calculate the PGL deductions for you. Make sure you install the update for this when it’s available.

For more information, we provide a Business Consultation to ensure our clients benefits from tax planning and accounting matters.

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