Amnesty on student loan late payment penalties
The deadline for applications to the student loan amnesty on late payment penalties was 31 March 2008.
If you were eligible for the amnesty, then we have already either reversed or not applied the late payment penalties (applicable as at 31 March 2008) on your account. However, you needed to apply for the amnesty by 31 March 2008 to avoid a one-off amnesty penalty being added to your account. Borrowers whose application for the amnesty was accepted need to meet their amnesty repayment obligations.
- What's the amnesty penalty?
- What are my amnesty repayment obligations?
- What if I don't meet my amnesty repayment obligations?
- What if I was eligible but didn't apply?
- How do I make an objection to the amnesty penalty?
- What happens when I complete my amnesty repayment obligations?
- Background information about the amnesty on late payment penalties
- Contact details for the Student Loan Amnesty team
What's the amnesty penalty?
If you were eligible for the amnesty but didn't apply by 31 March 2008, an 'amnesty penalty' will have been added to your loan balance. This will show on your May/June 2008 student loan statement. This penalty will be the lesser of either:
- 5% of your total loan balance as at 31 March 2008 or
- the sum of your late payment penalties (applicable as at 31 March 2008) which have already been either reversed or not established.
You are no worse off as a result of the amnesty penalty than you were before the amnesty. This is because the amnesty penalty is no greater than the sum of the original late payment penalties (applicable as at 2008) that were reversed or not applied to your account. In addition, the penalty is being added to your loan balance rather than being treated as an overdue amount.
What are my amnesty repayment obligations?
If your application for the amnesty was accepted, you need to meet your student loan amnesty repayment obligations.
Your amnesty repayment obligations mean that you must make four payments over two years (ie six-monthly instalments) which will be based on the size of your loan balance. The due date for your instalments will depend on when we received your amnesty application.
The table below outlines what your total amnesty repayment obligations will be:
| If your loan balance is ... | the total amount you have to pay over 2 years is ... | so your 6-monthly payment is ... |
|---|---|---|
| less than $2,000.00 | your total loan balance | 1/4 of loan balance |
| $2,000.00 to $15,000.00 | $2,000.00 | $500.00 |
| $15,000.01 to $30,000.00 | $4,000.00 | $1,000.00 |
| more than $30,000.00 | $6,000.00 | $1,500.00 |
What if I don't meet my amnesty repayment obligations?
If your application for the amnesty was accepted but you don't meet your amnesty repayment obligations, an amnesty penalty will be added to your loan balance. The amount of this penalty will be the lesser of:
- 5% of your total loan balance as at 31 March 2008, or
- the sum of your late payment penalties (applicable as at 31 March 2008) which were either reversed or not established.
This penalty amount will then be adjusted based on how many payments you have made under the amnesty.
What if I was eligible for the amnesty but didn't apply?
You were eligible for the amnesty if:
- you were non-resident for tax purposes on 31 March 2006, and had late payment penalties as at 1 April 2007, or
- you were overseas as at 31 March 2006, but hadn't advised us that you had left New Zealand.
If you were eligible for the amnesty but didn't apply by 31 March 2008, an 'amnesty penalty' will have been added to your loan balance. This will show on your May/June 2008 student loan statement.
This penalty will be the lesser of either:
- 5% of your total loan balance as at 31 March 2008, or
- the sum of your late payment penalties (applicable as at 31 March 2008) which have already either been reversed or not established.
How do I make an objection to the amnesty penalty?
If you believe that the amnesty penalty has been incorrectly applied to your account or that the amount of the penalty is incorrect, you can call us at:
- 03 951 2020 from within New Zealand
- +64 3 951 2020 from overseas
What happens when I complete my amnesty repayment obligations?
We'll send you a letter when you've completed your amnesty repayment obligations. This letter will explain what your new repayment obligations will be. Your new obligations will depend on whether you're a New Zealand-based or overseas-based borrower.
If you're still overseas once you have met your amnesty repayment obligations, you will be eligible to apply for a repayment holiday of up to three years. While you're on a repayment holiday you don't have to make any compulsory repayments towards your loan. However, interest will continue to be charged on your student loan, so it's a good idea to make additional repayments to help keep on top of your loan.
How to apply for a repayment holiday
To receive the repayment holiday you must apply for it by contacting us. You'll need to provide the following information:
- your name and IRD number
- your contact details; and
- the date you would like your repayment holiday to start from
Background information about the amnesty on late payment penalties
The student loan amnesty was offered to student loan borrowers who've been living overseas and got behind in their repayments.
Borrowers were eligible for the amnesty if:
- they were non-resident for tax purposes on 31 March 2006, and had late payment penalties as at 1 April 2007, or
- they were overseas as at 31 March 2006, but hadn't advised us that they left New Zealand.
Eligible borrowers had late payment penalties either reversed or not applied to their student loan account. However, eligible borrowers need to have applied for the amnesty by 31 March 2008.
If a borrower was eligible for the amnesty but didn't apply by 31 March 2008, a one-off amnesty penalty has been added to their loan balance and will show on their May/June 2008 student loan statement. This one-off penalty is the lesser of either:
- 5% of their total loan balance as at 31 March 2008, or
- the sum of their late payment penalties (applicable as at 31 March 2008) which were either reversed or not established.
Borrowers whose application for the amnesty was accepted need to meet their student loan amnesty repayment obligations. This means they must make four payments over two years (i.e. six-monthly instalments) which will be based on the size of their loan balance. If they don't meet their amnesty repayment obligations, they will also have the one-off penalty added to their loan balance. This penalty amount will be based on how many payments they have made under the amnesty.
Contact details for the Student Loan Amnesty team
| From NZ | Phone: 03 951 2020 | Fax: 03 951 2216 |
| From overseas | Phone: 64 3 951 2020 | Fax: 64 3 951 2216 |
| nonres@ird.govt.nz | ||
| Address | Inland Revenue Student Loan Amnesty team Private Bag 1932 Dunedin New Zealand |
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Next steps
Date published: 26 May 2008
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