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New Zealand law explained for everyone

Student Loan Scheme Act 2011

Repayment obligations of borrowers - New Zealand-based borrowers' repayment obligations for salary or wages - Unused repayment threshold may be allocated to secondary employment earnings

44: Calculating borrower's unused repayment threshold for pay period

You could also call this:

“How to work out the leftover money you can earn before paying back your student loan”

You can figure out how much of your repayment threshold you haven’t used for a pay period. This is called your unused repayment threshold. Here’s how you work it out:

First, take the yearly repayment threshold and divide it by 4. Then, subtract how much you expect to earn from your main job in three months. Finally, divide this by how many times you get paid in those three months.

The amount you get is your unused repayment threshold for each time you get paid. This is important because it helps decide how much you need to repay on your student loan from your other jobs.

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View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=DLM3180122.

Topics:
Education and learning > Higher education Money and consumer rights > Banking and loans
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43: Determining estimated salary or wages, or

"How to guess your income for three months"

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45: Special deduction rate certificate for unused repayment threshold, or

"Getting a special certificate to use your leftover repayment threshold for your second job"

Part 2 Repayment obligations of borrowers
New Zealand-based borrowers' repayment obligations for salary or wages: Unused repayment threshold may be allocated to secondary employment earnings

44Calculating borrower's unused repayment threshold for pay period

  1. A borrower's unused repayment threshold for a pay period is calculated in accordance with the formula—

    a = (b − c) ÷ d

    Where:

    • a a

      is the unused repayment threshold for a pay period

    • b b

      is the annual repayment threshold for the relevant tax year divided by 4

    • c c

      is the borrower's estimated primary employment earnings in the relevant quarter, as notified to the Commissioner in accordance with section 42(3) or 47(2)(a)

    • d d

      is the number of the borrower's pay periods in the quarter for his or her primary employment earnings.