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New Zealand Student Loan Repayment Guide for UK Graduates

Managing UK student loans while living and working in New Zealand: SLC rules, overseas thresholds, working holiday visas, enforcement, and practical planning for British graduates abroad

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Moving to New Zealand does not close or cancel a UK student loan. The contract remains with the Student Loans Company (SLC). What changes is the collection mechanism: instead of PAYE deductions through HMRC, you move to direct payments after an Overseas Income Assessment once you are outside the UK for more than 3 months.

New Zealand is treated as a relatively high-income country in SLC’s overseas repayment system. Thresholds reflect local earnings and cost of living, but SLC still expects many UK graduates there to repay. If you cooperate and provide evidence, repayments track your income. If you ignore SLC, they assume high income and push you onto the top fixed repayment band.

This guide covers the mechanics for UK borrowers in New Zealand: how and when to notify SLC, how your NZD income is assessed, how the New Zealand tax and student loan systems interact with UK loans, what happens on working holiday visas and temp contracts, and the actual enforcement risk if you drift into arrears.

Telling SLC Before and After Moving to New Zealand

SLC requires notification if you will be outside the UK for more than 3 months. That includes classic one-year working holiday trips as well as longer moves. Once SLC flags you as an overseas borrower, you must complete an Overseas Income Assessment and pay them directly based on your income.

Before Leaving the UK (Best-Case Setup)

  • Log in to your online SLC account and update email, phone, and address.
  • Download or request the current Overseas Income Assessment Form.
  • Gather New Zealand job offers, recruitment emails, or realistic salary bands for your sector.
  • Note your Customer Reference Number and National Insurance number somewhere you can access abroad.
  • Keep at least one UK bank account open and controllable online.

After Arrival in New Zealand (Typical Reality)

Many people fly first and fix paperwork once they have an NZ phone and address. If that is you:

  • Update SLC with your New Zealand address, email, and mobile number.
  • Complete the Overseas Income Assessment using your NZ employment contract, job offer, or first pay slips.
  • If you are still job-hunting or travelling on savings, you can be assessed on low/zero income rather than being treated as a high earner.
  • Decide how you will move money: regular NZD→GBP transfers into a UK account that funds a direct debit is the cleanest route.

Once UK PAYE deductions stop, doing nothing is not neutral. If SLC has no HMRC data and you ignore overseas assessments, they treat you as a non-compliant overseas borrower and set fixed repayments at the top of your band.

Overseas Income Assessment and Evidence

SLC cannot see Inland Revenue (IR) payroll data in New Zealand. The Overseas Income Assessment is their workaround. You provide proof of income; they convert it into GBP; they apply the New Zealand threshold for your loan plan; they set a monthly repayment for a 12-month period.

Evidence SLC Commonly Accepts from New Zealand

  • Employment contract or offer letter showing gross salary in NZD and expected hours.
  • Recent NZ pay slips or payroll summaries.
  • For casual/seasonal work (hospitality, fruit picking, tourism): pay slips, roster summaries, and bank statements showing income.
  • For self-employed, contractors, or freelancers: invoices, NZ bank statements, and any IR tax filings.
  • If travelling on savings or currently not working: bank statements and a basic budget, plus any support from family or partners.

Assessment Cycle

  1. SLC requests an Overseas Income Assessment for a specific 12-month assessment period.
  2. You complete the form and attach income evidence covering your expected or actual NZ income.
  3. SLC converts your income from NZD to GBP using its NZD/GBP overseas rate and applies the New Zealand threshold for your plan.
  4. They calculate your annual repayment and divide it by 12 to set a fixed monthly amount.
  5. Near the end of the period, SLC asks for updated evidence and repeats the process for the next year.

If your income jumps or collapses mid-year, you can ask for reassessment. Refusing to engage and then missing payments is the route to arrears and inflated fixed charges.

How SLC Calculates Repayments from NZ Income

Geography does not change the base rule: for undergraduate loans you pay 9% of income above the threshold; for postgraduate loans you pay 6% above the postgraduate threshold. For overseas borrowers the thresholds are country-specific. New Zealand has its own values, published alongside other overseas thresholds.

Example: Plan 2 Borrower Working in New Zealand

Example is illustrative only. Real thresholds and FX rates change over time.

  • Gross NZ salary: NZD $70,000 per year.
  • SLC converts your assessed annual income to GBP using its internal NZD/GBP rate for that year.
  • They compare this figure with the New Zealand Plan 2 threshold from the overseas thresholds table.
  • 9% is charged on income above that threshold; then divided by 12 for the monthly amount.

Process overview:

  • Convert total NZD income → GBP using SLC’s rate.
  • Subtract the New Zealand threshold for your plan.
  • Apply 9% (undergraduate) or 6% (postgraduate) to the excess.
  • Divide by 12 to get your monthly repayment.

Operational Details

  • SLC does not collect via New Zealand payroll. You pay via UK direct debit or manual transfer.
  • Seasonal earnings, overtime, and variable hours are rolled into an annualised income figure.
  • New Zealand thresholds differ from UK domestic thresholds and are updated in SLC’s overseas tables each year.
  • Moving to New Zealand does not change interest rates, write-off ages, or plan rules; only the collection channel changes.

New Zealand salaries vary widely by sector. High-paid professionals will usually repay more quickly than in lower-paid UK roles. Seasonal or low-paid workers can legitimately sit close to the threshold if they keep SLC updated.

Interaction with NZ Tax and Local Student Loans

New Zealand has its own student loan system run through Inland Revenue. Do not confuse that with your UK loan. They are separate contracts with separate rules. New Zealand tax and student loan deductions do not cancel or replace UK student loan obligations.

Tax and Deduction Basics

  • You pay New Zealand income tax and any NZ student loan deductions under local law through PAYE or self-assessment.
  • Separately, you pay SLC what they require under your UK loan after the Overseas Income Assessment.
  • UK student loan repayments are not normally deductible for New Zealand tax purposes.
  • SLC looks at your gross income figure, not your after-tax take-home pay.

Common Confusions

  • “I already have New Zealand student loan deductions, so that covers the UK one.” Wrong. Two systems, two obligations.
  • “I’m non-resident for UK tax, so my UK student loan is paused.” Wrong. The loan contract isn’t tied to UK tax residency.
  • “My NZ accountant doesn’t care about it, so it can’t matter.” Their scope is NZ tax compliance. SLC sits outside that.

Keep the buckets separate: NZ tax and NZ student loans in one bucket, UK student loan in another. They compete for cash-flow, but they do not legally cancel each other out.

Working Holiday Visas, Gaps, and Mobility

New Zealand is a magnet for UK working holiday makers: casual hospitality work, seasonal farm jobs, plus travel. That pattern creates irregular income and periods with no work. None of this suspends your UK loan automatically; you still sit inside SLC’s overseas framework.

Typical Patterns

  • Three months of casual work, then two months of travel, then another job.
  • Alternating between New Zealand and Australia within one year.
  • Short periods of no income between seasonal contracts.

How to Handle This for SLC Purposes

  • Provide an honest estimate of total income over the 12-month assessment period, not just one job slice.
  • Include evidence for all roles, even if short and casual — pay slips and bank entries are enough.
  • If income ends up materially lower than estimated, request a reassessment rather than defaulting.
  • If you split time between New Zealand and another country, SLC will typically use one country’s thresholds for the whole assessment period rather than micro-switching.

The rule is simple: SLC wants a single annual income number in GBP. Your visa type, working holiday status, or backpacking schedule is noise from their point of view.

Arrears, Fixed Payments, and Enforcement in New Zealand

The real risk in New Zealand is slow drift into arrears while you focus on travel or a new life and stop opening SLC emails. New Zealand is not a lawless gap in the system. SLC still treats you as a borrower with obligations and assumes you can pay if you do not engage.

What Happens If You Ignore SLC from New Zealand

  • You miss Overseas Income Assessment deadlines and ignore reminders.
  • SLC moves you onto a fixed monthly repayment at or near the top allowed band for your plan.
  • Missed fixed payments accumulate as arrears; collection costs may be added on top.
  • SLC can instruct international collection agencies operating in or from New Zealand.
  • If you later return to the UK, arrears and non-compliance sit on your record and can be enforced more aggressively.

On-the-Ground Enforcement Reality

SLC does not have Inland Revenue’s powers in New Zealand:

  • They cannot unilaterally deduct from NZ wages or seize NZ assets.
  • They can, however, keep the debt alive, send collectors, and enforce more easily if you come back to the UK or another cooperating jurisdiction.
  • Long-term arrears can also complicate later negotiations if you want to clean up your position quickly.

Filling in one assessment form a year and running a predictable direct debit is trivial compared with years of arrears and inflated fixed payments. Do the dull admin; avoid the compound hassle.

New Zealand Expat Practical Checklist

Use this as a working list before departure and during your time in New Zealand.

1. Before Leaving the UK

  • Confirm your loan plan(s), balance, and write-off rules.
  • Update SLC with a long-term email you actually monitor.
  • Download or request the Overseas Income Assessment Form.
  • Collect expected salary ranges or offers for New Zealand roles or typical working holiday jobs.
  • Keep at least one UK current account open and accessible online.

2. First 3 Months in New Zealand

  • Lock in at least your first job or expected income pattern.
  • Complete the Overseas Income Assessment and send NZ income evidence to SLC.
  • Set up a clean NZD→GBP transfer route and a direct debit from your UK account.
  • Store SLC letters/emails and repayment schedules where you can actually find them.

3. Each Assessment Year

  • Calendar SLC assessment deadlines; don't wait for “final reminders”.
  • Provide updated NZ pay slips, contracts, and any new income sources on time.
  • Check that the new monthly figure matches your income reality; request reassessment if not.
  • Keep your address, email, and phone up to date on the SLC portal.

4. If Your Circumstances Change

  • Job loss or reduced hours: tell SLC and request a new assessment instead of skipping payments.
  • Moving from New Zealand to another country: expect a new country-specific threshold and another overseas assessment.
  • Returning to the UK: inform SLC and be ready for PAYE deductions to restart once you are employed in the UK.

New Zealand changes your lifestyle, not your loan contract

UK student loans follow your income, not your postcode. Use the Overseas Income Assessment to keep repayments aligned with reality and avoid turning a predictable system into an avoidable mess.

👩‍🎓

Dr. Lila Sharma

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.