Calculate your student loan liability for CIS subcontractors, sole traders, and company directors. Plan for Self Assessment payments and understand CIS deduction interactions.
CIS tax deductions: £8,000(applied to your income tax bill)
Student loan liability: £543(separate payment via Self Assessment)
Important: CIS deductions do NOT cover student loan repayments. You need to pay student loans separately by 31 January 2027.
No automatic PAYE deductions - you must plan for annual payments via Self Assessment.
Construction Industry Scheme worker with no other income
Registered with HMRC, 20% CIS deductions
CIS deductions: £8,000
Net profit: £32,000
Rental, investment, other income
| Income Source | Gross | Net (for SL) |
|---|---|---|
| CIS Receipts | £40,000 | £32,000 |
| Other Income | £2,500 | £2,500 |
| Total for Student Loan | - | £34,500 |
Pay 90% directly to SLC to avoid SA late fees
Pension contributions reduce your student loan calculation
No automatic deductions:
Unlike employees, self-employed individuals must actively plan and save for student loan payments. There are no automatic monthly deductions from your income.
Annual payment shock:
Student loan payments of £542.7 can be a significant shock if not planned for throughout the year.
Expense planning:
Business expenses reduce your taxable profit and therefore your student loan liability. Ensure all allowable expenses are claimed.
Self-employed student loan planning is crucial to avoid unexpected bills. Get professional guidance on managing your obligations.