What Happens to Your Student Loan If You Move Abroad?
Moving overseas doesn’t make your student loan disappear. The Student Loans Company (SLC) continues to collect repayments regardless of where you live, and the rules for how much you pay change when you leave the UK.
You Must Notify SLC
If you’re planning to leave the UK for more than three months, you are legally required to inform SLC. This applies whether you’re moving for work, travel, or any other reason.
- Notify SLC within three months of moving abroad
- Provide your new overseas address and contact details
- Submit evidence of your income through the overseas income assessment form
- Continue providing income evidence annually to keep your repayments accurate
How Repayments Work Abroad
When you live in the UK, repayments are automatically deducted from your salary through PAYE. Abroad, the system works differently.
Country Thresholds
SLC sets country-specific repayment thresholds based on local cost of living — they may be higher or lower than the UK threshold.
Repayment Rates
You still repay 9% of income above the threshold for undergraduate loans (6% for Postgraduate Loans).
Direct Payments to SLC
Repayments are made directly to SLC rather than through your employer.
If you fail to complete the overseas income assessment, SLC doesn’t simply stop collecting. Instead, they apply fixed repayment amounts that are not based on your actual earnings.
- Fixed amounts can be significantly higher than what you would pay based on your real income
- This effectively acts as a penalty for not engaging with the process
- You can avoid this by submitting your income evidence on time each year
Consequences of Non-Compliance
Ignoring your student loan obligations while abroad can have serious consequences. SLC has several enforcement mechanisms available.
- SLC can take legal action to recover the debt
- Your debt may be passed to collection agencies
- If you return to the UK, missed payments could affect your credit record
- Additional penalties and interest may be applied to your balance
- HMRC can resume automatic deductions from your salary if you return to UK employment
Practical Steps Before You Move
If you’re planning to move abroad, take these steps to stay on top of your loan.
Notify SLC
Inform SLC of your move and new address as early as possible.
Complete the overseas income assessment
Submit the form to ensure your repayments are based on your actual income.
Check your country’s threshold
Look up the SLC website so you know what to expect for your destination.
Set up a payment method
Arrange a way to make direct repayments to SLC from abroad.
Keep records
Save all correspondence and payment confirmations with SLC.
Set annual reminders
Resubmit income evidence before the deadline each year.
Key Takeaways
- Moving abroad does not cancel or pause your student loan repayments.
- You must notify SLC within three months and provide annual income evidence.
- Repayment thresholds vary by country based on local cost of living.
- Failing to engage with SLC results in fixed repayment amounts that are typically higher than income-based payments.
- Non-compliance can lead to legal action, collection agencies, and credit impacts if you return to the UK.