Student Loans

Originally Posted by Ed

What relevance is it how it's spent?

If you earn say £30K cos you had a loan-funded education, and you'd otherwise have been able to do a job that paid say £20K, and you have to repay the loan that enables that extra £10K, then the tax on the £10K is effectively a double repayment. I can't see it's relevant whether it's spent on higher education, health, or some quango. Fact is, you're paying twice.

I understand what you are saying but the tax isn't a repayment.

I had a new style student loan (I assume that means the ones that don't have set payments btw!). I just want to participate in this thread so I can whinge

I have paid it off btw, in the end it only took about 3 years which seems quite good (it was "only" £9k). I just want to moan

Originally Posted by sarah

I understand what you are saying but the tax isn't a repayment.

What else is it then? It's money that the government wouldn't otherwise have. There is no way they'd have it, cos it wouldn't exist inthe first place. So the successful student has created welath, and if they are repaying the reason for thatwealth eleswhere - to the Student Loans Company - then they must surely be paying twice.

I probably would have paid the loan off in bulk had I not saved and bought a house. My mortgage interest rate is now the same as my student loan. If i had any money spare (which I dont) then I would probably attempt to pay the student loan off because it will just be a "student tax" for the rest of my career at the rate of payment and the rate of interest.

[timwilky]

Originally Posted by Ed

If your education enables you to earn more and therefore pay more tax, then the repayment of the amount it cost in the first place means that you're paying twice for the same thing.

Actually I agree with Ed on this. As I have previously said, the country benefits from an educated workforce. That sentiment was focused on what benefits in terms of end deliverable that workforce would generate. New products, systems, ways of working, wealth generated in selling out knowledge/products abroad etc.As in an end game.

I had totally missed what hits me hardest in the pocket. Tax. For the past 15-20 years I have paid the higher levels of tax. I started my working career as a 16 year old on an apprenticeship. If I had not had a strategy from day one that required me to prove myself, get my employer to sponsor me beyond the C&G that would have been the assembly line end point. I think that I would have been a product of 1980's rationalisation and an out of work waster.

Instead, I got £2,500 as a grant from HM government (self supporting, been working for 3 years) and £1,500 sponsorship from Leyland plus vacation employment. Real benefit to me was access to real labs, computers and facilities etc.

So for the £7,500 the government invested in me in the late 70s. I have repaid them with my never having made a benefit clain, paid tax at the higher rates for approx 20 years. and likely to be doing so for the next 20 years. I think they got more than a good deal out of me.

If I could give them a one off £7,500 and pay at 24% or whatever it would save me a fortune