Graduates overcharged by Students' Loan Company

An average of £557 too much was taken from 40,050 borrowers during the 2010/11 financial year by the Student Loan Company, according to figures obtained by MoneySavingExpert.com.

Once loans are repaid, the SLC is meant to notify the tax-office, but for tens of thousands of ex-students, this just hasn't happened.

Which? Money's Dan Moore said: 'It’s dreadful that payments are being taken from ex-students’ accounts, even though they have already faithfully repaid all the money they owed. The problem is that the repayments system is woefully inadequate.'

And what is done is not in this case easily undone. To rectify the error a complex reimbursement process can take up to half a year to rectify errors.

Money analyst Dan Plant says: 'This isn't necessarily anyone's mistake this time, more the fault of a poorly-designed cash collection system.

'Even though graduates pay out of their hard-earned wage-packet every month, the rules don't require this to be handed over, or even reported, to HMRC promptly. Make sure you claim any money back if it's not arrived.'

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