Martin Lewis Student Loan issue after minimum wage rise
Those with student loans may now be tipped into the repayment threshold if they work full time.
In a tweet, he raised the issue of the plan 5 student loan repayment threshold, which starts at £25,000 a year.
He said: "A full time worker doing 40hrs a week on the new increased £12.21/hr minimum wage would earn just over £25,000. The Plan 5 student loan repayment threshold (ie English students who started uni since 2023) is £25,000 and is frozen until 2027.
"So in the April after those graduates leave uni, even on min wage jobs, they'll now often need to start repaying (a little) bit of their student loans."
He added in a follow up: "Many people saying 'it's the interest rates that are the killer' actually that's not true. These new Plan 5 loans interest is set at the rate of inflation, that seems good but it distracted from the killer changes to this cohort of students.
"The repayment threshold was lowered to £25,000 so people start repaying on lower incomes. Repayments last 40 years not 30 years.
"For many this effectively increased what they'd likely repay by very roughly around 50% (barring very high earners who'd repay less due to lower interest and the fact they'd have cleared early anyway). It was a huge stealth rise that many missed, as it's tough to explain and people focus on tuition fees (the recent rise in which had trivial impact compared to these changes)."
You could be owed money by the Student Loans Company🚨 Managed to bag yourself a refund? Let me know👇🏻
This varies, but graduates only repay when their income is over the threshold amount for their particular repayment plan, unless they've been overpaid.
Their income is the amount they earn (including things like bonuses and overtime) before tax and other deductions.
The threshold amounts change on April 6 every year.
The earliest they start repaying is:
Repayments automatically stop if either:
The threshold is over £501 a week, £2,172 a month or £26,065 a year.
The threshold is over £547 a week, £2,372 a month or £28,470 a year.
The threshold is over £629 a week, £2,728 a month or £32,745 a year.
The threshold is over £480 a week, £2,083 a month or £25,000 a year.
For a Master's Loan or a Doctoral Loan, the threshold is over £403 a week, £1,750 a month or £21,000 a year.
The Student Loans Company (SLC) will write to anyone who has been paid more student loan or grant than they're entitled to.
They must repay this separately from the rest of their student loan.
Very much yes. And many people have.
You can ask for a refund if:
HM Revenue and Customs (HMRC) will tell your employer to stop taking repayments from your salary when you have repaid your loan in full. It can take around 4 weeks for salary deductions to stop.
This means you may pay back more than you owe.
You can avoid paying more than you owe by changing your payments to Direct Debit in the final year of your repayments.
Martin Lewis: Biggest factor to change mortgage rates
Martin Lewis shares 'what to do' as energy bills set to increase 6.4 per cent
Martin Lewis Energy Price Cap warning
If you have paid too much the Student Loans Company (SLC) will try to:
If you've overpaid and have not heard from SLC you can ask them for a refund.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Scotsman
2 hours ago
- Scotsman
Rachel Reeves spending review: What will be in the spending review and what does it mean for Scotland?
The Spending Review will be delivered by Chancellor Rachel Reeves on Wednesday. Sign up to our Politics newsletter Sign up Thank you for signing up! Did you know with a Digital Subscription to The Scotsman, you can get unlimited access to the website including our premium content, as well as benefiting from fewer ads, loyalty rewards and much more. Learn More Sorry, there seem to be some issues. Please try again later. Submitting... Chancellor Rachel Reeves will deliver the Spending Review on Wednesday, in what is expected to lead to a significant amount of money for Scotland. While some areas with the greatest uptick in spending are devolved, the nature of the Barnett Formula means the Scottish Government will be allocated extra funds, in what The Scotsman understands will be a significant increase. Advertisement Hide Ad Advertisement Hide Ad Reform UK has suggested the Barnett Formula and block funding grant from Westminster should go to be replaced with more tax powers for the Scottish Parliament The formula is used to work out the level of public spending for each of the devolved administrations. The Barnett Formula aims to be fair mechanism by giving each of the devolved administrations the same pounds-per-person change in funding. Here's what is expected to be in the spending review and what it means for Scotland. Winter fuel Scottish pensioners now face being worse off than those in England and Wales after the UK government confirmed its U-turn over the winter fuel payment. The Chancellor announced on Monday the payment, worth up to £300 for each recipient, will be restored to the vast majority of pensioners who previously received it because anyone with an income of under £35,000 a year will now get the payment automatically. Advertisement Hide Ad Advertisement Hide Ad However, Scotland has already created a devolved benefit of £100 for all pensioner households, which is less generous than the UK government version, potentially leaving hundreds of thousands of Scots worse off than their English and Welsh counterparts. With Holyrood being sent more money through the Barnett Formula, Scottish Labour has urged the Government at Holyrood to increase its payments. Energy UK energy secretary Ed Miliband endured a battle with the Treasury over funding, but is now expecting several big announcements. Advertisement Hide Ad Advertisement Hide Ad Prime Minister Sir Keir Starmer (centre), Scottish Labour leader Anas Sarwar (right) and Ed Miliband, Energy Security and Net Zero Secretary (left), during a visit to St Fergus Gas Terminal, a clean power facility in AberdeenshirePicture: Jeff J Mitchell/PA Wire Most notably, the UK government has announced a £14.2 billion investment to build the Sizewell C nuclear plant in Suffolk - a project that could boost energy in Scotland, despite being based elsewhere. For Scotland, it is also understood the government is set to commit to a multi-decade, multi-billion redevelopment of HMNB Clyde, with funding in the hundreds of millions for the next few years. There are also hopes the Chancellor could finally sign off on the Acorn project. Based near Peterhead, it has been in the pipeline for years and would allow fossil fuels to continue to be burnt without, in theory, releasing harmful carbon emissions. The project is seen as key to scaling up the low-carbon hydrogen sector in Scotland and future plans for Grangemouth, but the technology has not yet been demonstrated at commercial scale. One way or the other, a decision is expected during the spending review. Advertisement Hide Ad Advertisement Hide Ad Health Wes Streeting's department is expected to get one of the biggest funding boosts, which will in turn lead to more money for Scotland through the Barnett Formula. Shortly after the statement from Ms Reeves, the UK government will publish groundwork for its NHS ten-year plan. This will give an idea of the financial boost to Scotland and also what Labour might try to do to NHS Scotland if they win the Holyrood election next year.
South Wales Argus
3 hours ago
- South Wales Argus
Martin Lewis: Winter fuel payment changes 'big improvement'
The payment, worth up to £300, will be restored to the vast majority of pensioners who previously received it because anyone with an income of under £35,000 a year will now get the payment automatically. Martin Lewis tweeted: Winter Fuel Payment to be reinstated for all State Pensioners this winter, but then clawed back via tax system for all who earn over £35,000 (roughly average earnings). This is a big improvement. Full instant analysis video coming with all the details in a minute. #WinterFuelPayment NEWS. Winter Fuel Payment to be reinstated for all State Pensioners this winter, but then clawed back via tax system for all who earn over £35,000 (roughly average earnings). This is a big improvement. Full instant analysis video coming with all the details in a minute.… — Martin Lewis (@MartinSLewis) June 9, 2025 The full details were announced here. Devolved authorities in Scotland and Northern Ireland will each receive a funding uplift so they too can meet the new threshold. Pensioners who do not want to receive the payment will be able to opt out, according to the Treasury. The decision to limit the winter fuel payment to only those who claimed pension credit was one of Labour's first acts in Government, aimed at balancing what was described as a £22 billion 'black hole' in the public finances. This meant the number of pensioners receiving the payment was reduced by around 10 million, from 11.4 million to 1.5 million. The Treasury claims the new arrangement will cost £1.25 billion in England and Wales, while means-testing winter fuel will save the taxpayer £450 million. Chancellor Rachel Reeves said: 'Targeting winter fuel payments was a tough decision but the right decision because of the inheritance we had been left by the previous government. 'It is also right that we continue to means test this payment so that it is targeted and fair, rather than restoring eligibility to everyone including the wealthiest. 'But we have now acted to expand the eligibility of the winter fuel payment so no pensioner on a lower income will miss out. 'This will mean over three-quarters of pensioners receiving the payment in England and Wales later this winter.' Video done, just working on adding subtitles, then it'll be up, it answers most of the questions i'm seeing — Martin Lewis (@MartinSLewis) June 9, 2025 Those with an income above this threshold will also receive the payment, but it will then be reclaimed from them in tax. To be eligible for the winter fuel allowance, a person will need to have reached state pension age by the week starting September 15 this year. Some two million pensioners who earn more than £35,000 will see their winter fuel payments clawed back via the taxman, the Treasury estimates. But, Kemi Badenoch, Leader of the Opposition, claimed the Prime Minister had 'scrambled to clear up a mess of his own making'. Recommended reading: Liberal Democrat Leader Sir Ed Davey said: 'Finally the Chancellor has listened to the Liberal Democrats and the tireless campaigners in realising how disastrous this policy was, but the misery it has caused cannot be overstated. 'Countless pensioners were forced to choose between heating and eating all whilst the Government buried its head in the sand for months on end, ignoring those who were really suffering. 'We will now study the detail of this proposal closely to make sure those who need support actually get that support. The pain they went through this winter cannot be for nothing.'
The Herald Scotland
8 hours ago
- The Herald Scotland
Parents to be given right to request new Gaelic schools
The plans have been confirmed by Deputy First Minister Kate Forbes MSP, who is also Cabinet Secretary for Economy and Gaelic, during a visit to Bun-Sgoil Ghàidhlig Inbhir Nis (Inverness Gaelic Primary School). The announcement coincides with the 40th anniversary of Gaelic medium education in Scotland. The proposed Scottish Languages Bill is expected to be considered by MSPs on Tuesday 17 June. As well as establishing the right of parents to request new Gaelic-medium schools, the Bill will allow for the creation of 'areas of linguistic significance in Gaelic communities which the government says will enable ministers to 'better target policies to support the language's growth.' The new law will also establish both Gaelic and Scots as official languages, introduce specific education standards for Gaelic and Scots, and enable parents across Scotland to apply for Gaelic-medium nursery provision for their children. Recent census statistics revealed that more than 130,000 people in Scotland have some Gaelic skills, a significant increase from the levels found in 2011. The number who understand or use Scots had also risen considerably. A world-first assessment and accreditation model for Gaelic learners is also due to be introduced in Scotland following development by Sabhal Mòr Ostaig, the National Centre for Gaelic Language and Culture. A new strategy to support the development of Gaelic outside of school classrooms is also in development. However, there is a significant drop-off in uptake of Gaelic between primary and secondary school levels, and experts have previously warned that more must be done to promote the 'value of Gaelic' to parents and young people. READ MORE During the visit to Inverness, Ms Forbes said: 'This Bill aims to build a strong foundation to support Gaelic's continued growth following an encouraging increase in Gaelic speakers and learners across Scotland. It would boost Gaelic education provision throughout Scotland and better establish Gaelic and Scots as national languages. 'Gaelic medium education enriches communities and offers good value for money. Gaelic medium schools frequently demonstrate above average performance with some local authorities showing better grades across all qualification levels despite costs being no greater than English medium schools. 'To support the growth of Scotland's indigenous languages, we are also providing an additional £5.7 million to promote Scots and Gaelic this year.' The Bill and its provision are also supported by Scotland's Makar (national poet) Dr Peter Mackay, who writes in both English and Gaelic: 'It's fantastic to have seen the growth of Gaelic medium education over the last 40 years: it's something we should be very proud of. 'It's vital that there's ongoing support to maintain and develop Gaelic as a community language in the Highlands and Islands and to give people all over the country every chance to learn and speak it – and also to encourage Scots speakers and communities across Scotland."
