CSLM17020 - SL repayments: borrower within PAYE: what to do when employment ceases

Employer action - Borrower ceases employment

When an employee ceases employment the employer must consider whether to make an entry in the box headed ‘Enter Y if Student Loan deduction is due to be made� on form P45.

»Ê¹ÚÌåÓýapp employer should enter a ‘Yâ€� in the box ‘Enter Y if Student Loan deduction is due to be madeâ€� if

  • A Start Notice has been received from HMRC with a start date in the current tax year

Or

  • »Ê¹ÚÌåÓýapp employer has previously received a form P45 with a ‘Yâ€� in the box headed ‘Student Loan Deductions to continueâ€� And
  • No Stop Notice has been received from HMRC

In all other circumstances no entry should be made.

Notes:

1. »Ê¹ÚÌåÓýapp above guidance should be followed regardless of whether deductions have actually been made, perhaps because the employee’s earnings did not exceed the threshold
2. »Ê¹ÚÌåÓýapp amount of any Student Loan deductions should not be shown on form P45

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HMRC action

None.