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Student loan not deducting

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Summary

What to check if a student loan isn't calculating in Sage 50 Payroll.

Description

There are several reasons why student loan may not deduct. After you complete each section of this guide, check if you've resolved the issue.

Resolution

No student loan in place

When you set up an employee, the Continue Student/Postgraduate Loan? flag defaults to No. To check the student loan:
  1. Double-click the required employee.
  2. Click the Employment tab.
  3. Click the Student/Postgraduate Loans button.
  4. Check the details are correct then click OK.

Employee's earnings below the threshold

Check that the employee's pay reaches the threshold from which the student loan is due.

  1. Select the relevant employee on your employee list.
  2. Click Payroll, then Enter Payments.
  3. Click the Information tab, then from the tree view in the left-hand pane, click National Insurance.

For student loan to deduct, the Earnings for NI value must be higher than the earnings threshold for the employee's payment frequency.

If you aren't certain of the Student loan thresholds or rates, .

If 9% of earnings above the Student Loan threshold is less than £1, no student loan deducts as per HMRC's SL3 tables.

Process date is before the student loan start date

No student loan calculates if the student loan start date is after your current processing date.

To check your process date:

  • From the navigation bar, click Payroll then, from the Tasks pane, click Change Process Date

To check the student loan From date:

  1. Open the employee's record.
  2. Click the Employment tab.
  3. Click the Student/Postgraduate Loans button.
  4. Check the date here.

Student loan end date in place

Enter a student loan end date if HMRC sent you a request for this, for example by an SL2 Stop Notification.

If you entered a stop date incorrectly, you need to correct this.

  1. Double-click the relevant employee to open their record.
  2. Go to the Employment tab then select the Student/Postgraduate Loan button.
  3. Remove the End Date and select OK.
  4. Select Save then Close.

The employee has an attachment of earnings (AEO)

If an employee has an AEO, the priority and the protected earnings settings can prevent a student loan deduction.

To check for attachments:

  1. Double-click the relevant employee to open their record.
  2. Go to the Employment tab.
  3. Select the Pay Elements button then go to the Attachments tab.

If the employee has an attachment, check the priority setting. Amend the priority setting if required.

NOTE:

If you're not certain which priority setting to use, check with the authority that issued the attachment.

Incorrect legislation settings

Sage 50 Payroll contains the correct student loan legislation. Only change these settings if directed by HMRC or by Sage.

To check your legislation settings:

  1. Click Company then, Legislation.
  2. Click the Student tab and check the legislation as required.

If you're not certain if you changed the legislation in your software, you can check the current thresholds and rates on Gov.uk.

Plan type not saved

Check whether the plan type is correct.

  1. Open Enter Payments for the relevant employee and click the Information tab.
  2. Select the Student/Postgraduate Loans folder.
  3. Check the Student Loan Plan Type here’s correct.

If the plan type is missing, you need to delete and re-add the loan.

  1. Open the employee's record and click the Employment button.
  2. Click the Student/Postgraduate Loans button.
  3. Note the details here, then remove them all.
  4. Click OK, then Save.
  5. Click Student/Postgraduate Loans and re-enter the details.
  6. Click OK, then Save.
  7. Click Close.

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