Categories

Most Viewed

Martin Lewis on why students will pay an extra £2,000 on loans under frozen threshold

This week, the Government was accused of “quietly tightening the financial screws” on students and graduates, after the Chancellor announced a freeze on the threshold – meaning many will pay tax on an extra £1,255 this year

Video Loading

Video Unavailable

Martin Lewis questions Rishi Sunak on student loans

The student loan repayments threshold is being frozen from April affecting millions of people who recently graduated – and it means many earners will now pay more tax.

The changes affect people on plan two loans – these are those who started university in or after 2012 in England and Wales and who currently work and repay their loans.

Under the current threshold, you pay 9% of everything you earn above £27,295 a year.

“We were set to see in April that this would rise by average earnings by 4.6% which means you would pay 9% of everything you earn above £28,550, but the government has frozen what you pay at the current threshold at £27,295,” Martin Lewis said on Thursday’s ITV Money Show.

“This is a bit like tax,” he explained.

“The higher you pay, the better for you. The freeze means you will now pay 9% on an extra £1,255 that you would not have otherwise paid if the threshold had changed.







People will have to pay 9% tax on £1,299 more of their earnings this year
(

Image:

AFP via Getty Images)

“Everyone that repays plan two student loans will now repay £113 more this year to the government.”

But it gets…

Read more…

    Leave Your Comment

    Your email address will not be published.*

    Fraudsters News