Using Your P60 to Identify Student Loan Overpayments and Claim Refunds
Most people receive a P60 or P45 at some point during their working life and promptly file it away without looking closely at the numbers. But these two documents contain critical information about your student loan repayments. They show exactly how much has been deducted, whether your tax code was correct, and most importantly, whether you've overpaid or underpaid throughout the year.
Understanding what these forms tell you about your student loans can mean the difference between losing hundreds of pounds to overpayments or facing surprise bills for underpayments. These aren't just administrative documents to keep in a drawer. They're your evidence of what you've actually paid and your starting point for claiming refunds when things go wrong.
The confusion around P60s and P45s stems from their technical nature and the assumption that employers always get things right. They don't. Tax codes change, student loan statuses update, and communication between HMRC, the Student Loans Company, and employers breaks down regularly. Your P60 or P45 is often the first place you'll spot these errors, but only if you know what to look for.
A P60 is an "End of Year Certificate" that summarizes your total pay and deductions for a complete tax year (April 6th to April 5th). Your employer must provide it by 31 May following the end of the tax year. If you were employed on April 5th, you get a P60. If you left before then, you don't.
For student loans, the critical figure is the "Student Loan Deductions" box. This shows the total amount deducted through PAYE during that tax year. This number should match what you calculate based on your annual income and your plan's threshold.
Many people never look at this figure. They check their gross pay, maybe glance at the tax total, then file the P60 away. But that student loan deduction line is where errors become visible. If you finished repaying in November but deductions continued through March, your P60 will show you've overpaid. If your employer used the wrong plan threshold, the total will be incorrect.
A P45 is a "Details of Employee Leaving Work" form that your employer must give you when you leave a job. Unlike a P60 which covers a full tax year, a P45 covers the period from April 6th to your leaving date, or from your start date to leaving date if you joined mid-year.
Parts 2 and 3 are crucial when starting a new job. You give them to your new employer so they can continue your tax and student loan deductions correctly without putting you on an emergency code.
For student loans, the "Total Student Loan Deductions" figure shows what's been deducted up to your leaving date. Your new employer uses this to continue deductions correctly. If this figure is wrong or if your tax code incorrectly includes or excludes SL/PGL markers, problems will carry forward into your new job.
Student loan deductions on both forms appear as a separate line item, distinct from tax and National Insurance. The label varies slightly but typically shows as:
This figure represents the cumulative total deducted through PAYE up to the document date (April 5th for P60, leaving date for P45). It should match the sum of all student loan deductions shown on your payslips for that period.
If you have both undergraduate and postgraduate loans, some P60s and P45s break these down separately:
Others combine them into one total. If your form shows only one figure but you have both loans, check your payslips to verify both deductions were actually taken.
The tax code shown on your P60 or P45 should include SL, PGL, or both if you're repaying. If your tax code is "1257L" with no loan markers but you have student loan deductions showing, something is inconsistent. Either the deductions shouldn't have been taken, or your tax code should show the markers.
The P60 triggers year-end reconciliation, where what you've actually paid gets compared against what you should have paid based on annual income. This is when overpayments become apparent.
You made your final payment in September but deductions continued through March. Your P60 shows six months of unnecessary deductions. If you were paying £80 monthly, that's £480 overpaid.
Your employer used Plan 1 thresholds (£24,990) when you're actually on Plan 2 (£27,295). On a £30,000 salary, you've been overcharged:
You worked two part-time jobs, each applying the full monthly threshold. Your combined income warranted deductions, but the amount taken was incorrect. The P60 from each employer shows deductions, and when combined, the total exceeds what you should have paid on your actual annual income.
You had some very high earning months and some low earning months. PAYE deducted based on each month independently, not considering the annual average. Your P60 total might exceed the 9% of (annual income - threshold) calculation.
If the P60 figure is higher than your calculation, you've overpaid. The difference is what you can claim back.
Our student loan calculator can help you verify these calculations and determine exactly how much you're owed.
Underpayments are less common with PAYE because deductions happen automatically, but they do occur:
Your employer didn't have the SL marker in your tax code, so no deductions were taken. But you earned above the threshold and HMRC has you registered for student loan repayments. Your P60 shows £0 deductions when it should show several hundred pounds. You'll owe this through Self Assessment.
You began work in October on an emergency tax code without SL marker. By the time your correct code came through in December, you'd earned four months of income above the threshold with no deductions. Your P60 shows partial-year deductions that don't match your full annual liability.
Each job alone was below the monthly threshold, so neither employer deducted anything. But your combined annual income exceeded the annual threshold. Both P60s show £0 student loan deductions, but you actually owe money through Self Assessment.
Underpayments don't appear obviously on your P60. You need to calculate what should have been deducted and compare it to what actually was. If you've underpaid, expect a Self Assessment bill unless you proactively contact HMRC to arrange payment.
When you change jobs during the tax year, your P45 becomes the critical link between old and new employer. Problems arise when information doesn't transfer correctly.
Your P45 clearly shows tax code "1257L SL" and £180 already deducted in student loans. You give this to your new employer. They enter your details into their payroll system but somehow the SL marker doesn't transfer. For the rest of the tax year, you have no student loan deductions from the new job. You won't realize this until you check your first payslip from the new employer or receive your P60 at year-end. By then, you've underpaid for months.
Your old employer had the wrong tax code (without SL marker). Your P45 shows no student loan deductions. Your new employer uses this P45 to set up your payroll, continuing the error. Neither job deducts student loans all year, and your P60s show nothing. Come Self Assessment time, you owe a full year's worth of repayments.
Without your P45, your new employer puts you on an emergency tax code. Sometimes this includes SL if HMRC's records show you're a student loan borrower, sometimes it doesn't. You might end up on an emergency code without SL even though you're definitely repaying. The deductions stop, and you accrue a debt.
Always provide your P45 to new employers immediately and check your first payslip carefully.Verify the tax code matches your P45 and includes the correct loan markers. Don't assume the transfer happened correctly.
When you receive these documents, check the following:
Does it include SL, PGL, or both markers as appropriate for your situation? If you've never had a postgraduate loan but the code shows PGL, that's wrong. If you finished repaying but it still shows SL, that's wrong.
Does the figure make sense for your income? A rough check: take your annual gross pay, subtract threshold, multiply by 9%. If your P60 shows dramatically more or less, investigate why.
Add up all the student loan deductions from your monthly payslips. Do they total to the amount on your P60? If not, either payslips were wrong, or the P60 is wrong, or you're missing some payslips.
If you had more than one job during the year, get P60s or P45s from all employers. Check whether both applied student loan deductions and whether the combined total makes sense for your total income.
If you had periods of unemployment or gaps between jobs, verify that your P45 from the old job and P60 from the new job together cover the full period you were employed. Make sure there are no missing months of deductions that should have been taken.
If you've identified an overpayment on your P60, claiming it back requires contacting HMRC, not your employer or the Student Loans Company directly.
Collect your P60, all payslips for the year, and any correspondence from the Student Loans Company (especially if you finished repaying mid-year). Calculate exactly how much you overpaid and be prepared to explain why.
Call the Income Tax helpline (0300 200 3300) or use your Personal Tax Account online. Explain that you've overpaid student loan repayments through PAYE and want to claim a refund. Reference your P60 and the specific figures.
HMRC may ask you to send your P60 as proof. Do this promptly. They can't process your refund without evidence of what was actually deducted.
Refunds typically take 6-8 weeks to process. HMRC will check with the Student Loans Company to verify your loan status and confirm you did overpay. Once approved, the refund comes via bank transfer or check.
For smaller overpayments (under £100), HMRC sometimes adjusts your tax code for the next year to give you extra tax-free allowance rather than sending a refund. For larger amounts, you should receive actual repayment.
If your overpayment was due to employer error (wrong plan applied, deductions continued after your code was updated), you might think to ask your employer for the refund. Don't. The money has been sent to HMRC who forwarded it to the Student Loans Company. Only HMRC can retrieve it and refund you. Your employer can't give you money back directly.
If you complete Self Assessment, your P60 and any P45s become essential documents for accurate reporting. The Self Assessment form asks for total employment income and total PAYE deductions. Your P60 provides these figures.
For student loans specifically, Self Assessment calculates your repayment based on total income from all sources, then credits you for what you've already paid through PAYE. Your P60's student loan deduction figure is what gets credited.
If you don't enter this correctly, you might pay twice on the same income. Self Assessment calculates you owe £800 in student loans on your total income. Your P60 shows you already paid £600 through PAYE. You should owe £200. But if you forget to claim the £600 credit, you'll be billed for £800, overpaying by £600.
Always have your P60 and P45s when completing Self Assessment. The figures must be entered accurately. If you had multiple jobs, you need P60s or P45s from all of them to capture all PAYE deductions.
Our P60/P45 PAYE Input Reconciliation Calculator helps you check these figures match what you expected and identify any discrepancies before they become problems.
If you worked only part of the tax year, your P60 or P45 will show partial-year figures. This creates potential issues with student loan deductions because the threshold applies annually, not proportionally.
You worked January to April (4 months), earning £12,000. Your employer deducted student loans each month because your monthly pay exceeded the monthly threshold. Your P45 shows total deductions of £120.
But your actual annual income was only £12,000, well below the £27,295 Plan 2 threshold. You shouldn't have paid anything. All £120 is overpaid and claimable.
This happens because PAYE calculates month by month without knowing whether you'll work the full year. Your employer had no way of knowing you'd only work four months. They correctly applied the monthly threshold each pay period. But the annual calculation reveals you overpaid.
Always check part-year employment situations carefully. If you worked less than the full tax year and your total income was below the annual threshold, you're likely owed a refund of all deductions.
Increasingly, employers provide P60s and P45s digitally through payroll portals rather than on paper. These have the same legal status and contain the same information. However, digital versions create some practical issues:
If you leave a job and lose access to the employer's portal, you might not be able to retrieve your P45 later. Always download and save digital P45s immediately when leaving.
Digital documents can sometimes have processing errors that wouldn't occur on printed forms. Always review digital P60s and P45s carefully and compare them to your last payslip.
Keep digital copies in multiple locations. If you need to prove your PAYE student loan deductions years later, you'll need these documents. Cloud storage or email to yourself ensures you don't lose them.
Employers are legally required to provide these documents, but sometimes they don't arrive:
Contact your employer immediately after 31 May if you haven't received it. They must provide it. If they refuse or have gone out of business, contact HMRC who can provide the information from their records.
Request it from your employer when you leave. If they don't provide it within a reasonable time, contact HMRC. You can start a new job without a P45, but you'll initially be on an emergency tax code which might not include correct student loan deductions.
Without these documents, you can't verify your deductions or claim refunds effectively. Always pursue getting them.
Your P60 and P45 aren't just paperwork to file away. They're your proof of payment, your tool for spotting errors, and your evidence when claiming refunds. Every number on these forms tells part of your student loan story for that year.
When you receive a P60 each May or a P45 when leaving a job, spend five minutes checking the student loan figures. Compare them to your payslips and calculate whether they make sense for your income. Those five minutes could identify hundreds of pounds in overpayments or prevent underpayment bills months later.
If you spot errors, act quickly. HMRC can process corrections more easily when you raise them immediately rather than years later. Keep copies of all P60s and P45s for at least six years. You might need them for Self Assessment, for claiming refunds, or for resolving disputes with HMRC or the Student Loans Company.
The system isn't perfect, and your employer, HMRC, and the Student Loans Company don't always communicate correctly. Your P60 and P45 give you the information to spot when things have gone wrong and the evidence to put them right. Use them.
UK Education Policy Specialist
With over 15 years of experience in UK education policy and student finance, Dr. Sharma founded Student Loan Calculator UK to help students navigate the complex world of student loans.