Job Discussion Forums

[Jeembo007]

I am a UK Graduate (i.e. having graduated from a UK university) and I have a student loan debt, probably like a whole lot of other people on this forum.

I spent a year in China immediately after I graduated and did not tell anyone I was going abroad apart from family, friends and work. I simply did not think about student loans as it was all organized in such a rush.

I'm now about to go back to China, having spent the last 8 months back in the UK saving money and I've just found out that you're supposed to notify the student loans company if you are going abroad for more than 3 months otherwise you could face a penalty. I wasn't told this by the student loans company or any other authority, it was simply by pure luck that I stumbled upon this information on the internet.

I also found out that whilst working in China, any money you earn over �3,000 GBP (I assume per year) you have to pay back 9% of. You don't start your student loan repayments until April of the year following your graduation. So last year I was in China from September until August so in theory only anything earned between April and August would be eligible for loan repayments, but during that time I made far less than �3,000 GBP so I shouldn't owe them anything.

This time I'm going to Shanghai and I will be earning enough money to become eligible for loan repayments, if my calculations are correct then I will owe them 650RMB a month. I'm quite annoyed by this really because I feel I won't be earning enough to consider loan repayments and I was really hoping to save money and this is going to cut my potential savings by a third.

I'm happy to pay back my loan but not whilst I'm only earning 10,000RMB a month in Shanghai of all places. But I guess I'll have to!

I'm just a bit concerned about getting in touch with them because I didn't tell them last time I went abroad so I might face a penalty.

Does anyone have any experience of this they'd care to share?

[malu]

You've been given some duff information. The income threshold for a UK student loan is GBP12000 per annum (approx RMB15000 per month gross). They will ask for something like 9% of anything you earn above that, wherever in the world you earn it.

It is, as you have probably discovered, vitally important to tell the SLC before you go abroad, and to fill in a declaration of earnings form each year. If your earnings are less than the threshold your loan becomes 'deferred' which means interest continues to accrue but you don't need to make any payments. They may require evidence such as a copy of your contract or payslips. You can make voluntary payments at any time.

If you don't play ball the SLC has the power to call in the loan and charge a punitively high monthly repayment. If you are in China of course they can't enforce that payment order, but don't f*** with them unless you want a lifetime of grief. To be honest the yearly income assessment is so straightforward and hassle free that I don't understand why a small minority of Brits do choose to f*** with the SLC.

[arioch36]

My understanding, any one from the UK or OZ should be making a low enough wage that they never need pay. Us americans only get three years of such benefits

[Jeembo007]

Check this out:

http://www.slc.co.uk/thresholds/index.html

If you look for China it shows that anything you earn over �3,000 whilst in China you pay 9% of back to the loans company.

So with my 10,000RMB a month, I will pay back roughly �600 a year. But for a wage in England with for example �18,000 a year, which is just over double my quoted Chinese salary, you will pay back �300 a year!!!! This is ridiculous!!!!

I'd not be too fussed about paying back that amount in if I were going to earn that money in a smaller city, but I'm going to be in Shanghai where things are more expensive and it will hurt a little.

I hope they're flexible about this.

[malu]

B**ger me! You're right!

Jeez how slippery is that to change the system after all these years?

Those of us who became esteemed and valued customers of the SLC before 1998 seem to be in the clear - at least for the time being.

[roadwalker]

In the UK, can the loans be forgiven (i.e., not paid back)? If not, consider paying it back even if you aren't obligated to do so. In the US, it is darn near impossible to get a student loan off your back; they are specifically exempted from forgiveable obligations in our bankruptcy laws. And unless the interest rate is ridiculously low, the deferment is a false friend. At least try to pay the periodic interest to avoid growing the principal. I wish I had taken my own advice, but am happily in the clear now.

[Surfdude18]

I don't want people to act irresponsibly, but I'd also urge people from the UK not to panic if they do fall behind on their deferring (or indeed paying, in the (rare) instance that ESL teachers here earn enough to have to pay back their loan.

I stupidly didn't bother deferring mine. I rang them two months ago (five years after coming out here) and they said it had been transferred to a debt collection company. A week later it mysteriously bounced back to them and I've now made an agreement to pay it back at 100 pounds a month. But the good news is that there hasn't been a notable amount of interest on it.

Anyhow, as others have said, I think it's somewhat worse if you do this in the US.

[lou_la]

Since when has that happened? The limit for Hong Kong is 12,000, yet China only 3,000. Makes a lot of sense....

Do you have to tell them you're working? Tell them you're travelling instead?

[malu]

Even more bizarre is that Macau is also set at GBP3000. Is life in HK really 4x as expensive as in Macau??

[bish]

I just read this. I thought you only had to pay back if you were in the EU. I doubt they would notice though. So many people owe the loans it will be hard for them to manage and you can always say you were unemployed or travelling the world on a holiday (in which case you would not have been earning any money...)

[Jeembo007]

It seems a lot of people are unaware of this and I can't find anything about what the penalties are for not notifying them.

I have every intention of paying back the loan, but not in the way they want me to whilst living in China, I feel it's very short sighted of them to have one cost of living figure for a country the size of a continent. Especially when you take into account what malu pointed out.

Out of curiosity, who here does this apply to, and who here has or has not notified them?

[malu]

Of the six Brits at my school with student loans taken out on or after 1 Sept 1998 NONE of them knew about this. It is obviously one of those little bits of bad news that Gordon Brown-nose and his happy smiley nouveau Labour friends are so good at burying.

[arioch36]

surf

[Panicked]

I'm currently in my last few weeks of undergraduate study and intend to teach in China, so this is relevant to me.

In the java-script version of http://www.slc.co.uk/thresholds/index.html, it says that the payment threshold is �6,000, but in the non-javascript version, it states that the threshold is only �3,000. Is there another source that we can actually compare the figures to?

The information has changed, hasn't it? I'm sure that, when I checked a few months back the threshold was over �10,000 (I forget the exact figure) and whether you were in the UK or abroad, as long as you were working under this threshold, payment could be deferred.

(Hello, by the way: I'm a bit of a lurker.)

[Mr Pete]

i contacted them just before i came over in february, and they told me the threshold was 15,000 a year!! anyway i sent in all the papers to declare i was going abroad, and haven't heard from them since...