Newswire: January 2026

Welcome to the latest edition of Newswire – we hope you find it interesting and informative. We do everything we can to ensure all content is correct at the time of writing, but we do suggest you speak with us for professional advice, before acting upon anything that you read here.

More than 640,000 people can reclaim over £150m on Student Loans

Hundreds of thousands of people are entitled to refunds on their Student Loan repayments made in the 2024/25 financial year, and many of those with money owing are yet to make their claim.

The Student Loans Company (SLC) released stats showing more than 640,000 people are due refunds, with four scenarios that would result in a graduate being eligible for a Student Loan refund:

· Making a repayment, but eventually earning less than the annual repayment threshold.

· Being placed on the wrong Student Loan repayment plan.

· Making a repayment before the repayment period begins.

· Continuing to repay after their balance has been cleared.

Source: SLC

If a graduate didn’t make the repayment voluntarily, then they would be able to claim a refund in each of these cases.

What is the typical reason for a refund?

The most common reason for a Student Loan refund is because a graduate made a repayment on their Student Loan, without having met the annual earnings threshold for when it needs to begin being repaid.

A total of 643,824 people with what is known as a ‘Plan 2’ loan – which relates to loans that are “Post-academic year 2012/13 loans (pre-Plan 4 and 5) England and Wales only”, according to Gov.uk, were due to receive a total of £85,964,932 in refunds. That works out as £133.52 on average.

The figures also showed that 28,834 people made payments on their Plan 2 loans, before the repayment term should have started. A further 15,941 graduates with a Plan 2 loan made a repayment on the wrong plan, and a further 57,764 graduates had payments taken after their loan had been repaid in full.

Usually, if the threshold for repayment is met, then payments begin in the April following a student’s graduation. The above numbers are likely to include students with more than one type of Student Loan, across multiple plan types.

Aren’t these incorrect payments being refunded automatically?

The graduates who have already repaid their Student Loans in full, and have had an additional payment taken in error, should automatically get a refund. But if you think you might be in this position and haven’t yet heard from the SLC, you should still double check you haven’t made any payments after your Student Loan balance is repaid in full.

If someone is owed an amount that was paid before they reached the threshold for starting to repay their Student Loans, they also should be contacted by SLC the next financial year, to invite them to request a refund on their account.

Remember, you don’t have to have been contacted by SLC to request a refund. If you think you are due a refund and haven’t heard from SLC, then you can make the request yourself directly to SLC, and if you are eligible for a refund, it should be paid directly to your bank account.

You need the money back in your pocket

Given the problems many people currently have dealing with the cost of living, it is very important to make sure you are reclaiming any money you shouldn’t have paid to the SLC for your Student Loans. You can find more information on how to do this, and also the full stats for 2025, in the SLC’s guide to Student Loan refunds.

Tom Allingham, Save the Student’s student money expert, said: “By far the most common reason that a graduate might be eligible for a Student Loan refund is if they made a repayment despite eventually earning less than the annual threshold. This has most often affected those with a Plan 2 loan – English graduates who started uni between 2012–2023, and Welsh graduates who started any time since 2012.

“In 2024/25, the repayment threshold on this plan was £27,295. However, Student Loan repayments are taken when you’re paid – so depending on how often this is, your repayments are calculated against a weekly, fortnightly or monthly equivalent of the threshold instead.”

This threshold could be reached if extra shifts were worked in a week, or they received a bonus, or even changed job part way through the year, said Mr Allingham. But if the total earnings at the end of the year were less than £27,295, they would be eligible for a refund.

Mr Allingham added: “As for whether it’s worth actually claiming the money, the main thing to remember is that Student Loans aren’t like other types of debt. Many graduates with a Plan 2 loan will never clear the balance in full before it’s eventually cancelled, and monthly repayments are only affected by your earnings, not your outstanding debt. In other words, making voluntary repayments could just be throwing money away.

“And even if you have another type of Student Loan, or think you’ll repay in full, it might still be worth claiming a refund. An extra few hundred pounds could be a much-needed boost right now, even if it means taking a couple of extra months to repay the loan. But everyone will have their own priorities, and it may be that you’d rather overpay now and clear your balance earlier.”

If you or your children have Student Loans and think you or they may have paid too much and are due a refund, then please get in touch with us and we will explain what you need to know.

Taxpayers must be careful how they report CGT this year

Taxpayers with capital gains liabilities that they need to declare in their self-assessment tax return need to take extra care this year to avoid receiving a penalty from HMRC.

Changes made to the Capital Gains Tax (CGT) rates part-way through the 2024/25 tax year mean it will be more complicated to determine exactly what rate applies to each gain and, unfortunately, HMRC’s self-assessment software won’t calculate the correct amount for you. Instead, you will need to do this yourself or with your accountant, and the timing of each transaction will make a difference.

So, you will need to speak to your accountant to either help you file your return, or if your return has already been filed, to check that the calculation you have made is correct, as the sooner you remedy any underpayments, the better it is for you.

How did the rates change?

The CGT rates increased from October 30, 2024, which was the day of the Autumn Budget that year, and they applied to the disposal of assets, except for residential property and carried interest.

On that day, the rates increased as below:

· 10% to 18% for basic rate taxpayers.

· 20% to 24% for higher-rate taxpayers.

This created the complication for this year, as taxpayers need to split gains they made at different dates and then calculate the right amount of tax due, based on the relevant rates. They also need to allocate any losses and the annual exemption to gains realised either on or after October 30, to make sure they maximise their tax relief.

Yet despite the change being made by the Government a relatively long time ago, as already mentioned, HMRC’s software cannot do the calculation for you. So, there is an adjustment on the self-assessment form, in box 51, which you should have used to pay the correct amount of tax. If you didn’t, or you haven’t explained your calculations on the form in box 54, then you might need to make a change after filing. This is where your accountant will be able to help you.

Is there any way I can check my calculation?

Yes, HMRC has made a specific adjustment calculator available. But there is one other thing HMRC will be expecting in your tax return – you would need to have included a disclosure if you entered an unconditional contract before October 30, 2024, if it completed after that date.

Elsa Littlewood, private wealth tax partner at BDO, said: “Changing the CGT rates part way through the year has the potential to be a real banana skin for those completing the form and can be particularly tricky for those doing so without professional help. There is a risk that people unfamiliar with the rate changes will unwittingly input the wrong information as the self-assessment form will not automatically calculate the right CGT liability.

“It is helpful that HMRC have released a calculator that can be used to work out the adjustment to capital gains tax, but it would have been better if this was integrated within the tax return software.

“We would hope that HMRC would not charge penalties if tax returns submitted using HMRC’s software are incorrect and the amount unpaid is minor. But there is a risk of mistakes being made and it could lead to a flurry of disputes with HMRC later. Even if you have already submitted your self-assessment form, you may wish to go back and double check it to ensure it’s right.”

We can help you

If you have already filed your self-assessment tax return and think it might be worth revisiting it with us to check everything is correct, then please contact us and we will do everything we can to assist you.

Schedule a Call with James

Missed the January filing deadline? Here’s what to expect

Thousands of people once again took the chance to use some quiet time over the festive period to file their self-assessment tax returns, with 4,606 people even filing their return on Christmas Day.

In total, 37,435 people completed their return over the three days of festivities, Christmas Eve, Christmas Day and Boxing Day. But there are still thousands more taxpayers who are yet to file, which means they could be facing penalties for late filing after the January 31 deadline.

The penalties start as soon as you miss the deadline, whether there was any tax to pay to HMRC or not. If you are only due to file a self-assessment return to deal with the High Income Child Benefit Charge, there is a new PAYE digital service. If you had signed up to this before January 31, you could opt out of filing a self-assessment and chosen to pay back any money you owed through your tax code. But if you have missed the deadline, then for now, you still need to file a self-assessment.

How do the penalties work?

If you have to file a self-assessment tax return, you must file before January 31, 2026. If you missed this deadline, or you failed to pay your bill on time, then you will face a penalty.

You will immediately face a £100 penalty for filing late. If you still haven’t filed your return within three months, you will face additional daily penalties of £10 per day, to a maximum of £900. If you haven’t filed after six months, you will face a further penalty of 5% of the tax due, or £300, whichever is higher. If you haven’t filed within 12 months, then another 5% of the tax due is added, or an additional £300, whichever is greater.

If you’re filing your return as part of a partnership and it is filed late, then every partner will be charged a penalty. These are 5% of the tax due at 30 days, six months, and 12 months, plus interest on the amount owed.

What else do I need to know?

If you register for self-assessment after October 5, and also don’t file your return and pay your tax bill on time, you may get a ‘failure to notify’ penalty, according to HMRC. You can find more information on ‘failure to notify’ penalties on Gov.uk.

If you get a penalty, then you need to pay it within 30 days of the date on the penalty notice. You can appeal against a penalty if you disagree with it. However, if there is a good reason why you couldn’t file your self-assessment or pay your tax bill, such as being in hospital or losing a close relative, then you may be able to get the penalty waived.

If you find yourself in a situation where you are facing a tax penalty for any reason, then the best thing to do is speak to your accountant as soon as possible, and give as much information as you can to resolve the issue quickly.

We can help you meet your obligations

If you receive a penalty notice, or know you haven’t met your tax and filing obligations in good time, then please get in touch and we would be happy to give you the guidance you need.

Let's Talk: Schedule

Consultation Today!

Get Started Now

Empower Your Business Growth: Achieve Success on Your Own Terms with Expert Financial & Business Guidance