Reprint as at 1 September 2017

Coat of Arms of New Zealand

Student Loan Scheme Act 2011

Public Act
 
2011 No 62
Date of assent
 
29 August 2011
Commencement
 
see section 2
Note

Changes authorised by subpart 2 of Part 2 of the Legislation Act 2012 have been made in this official reprint.

Note 4 at the end of this reprint provides a list of the amendments incorporated.

This Act is administered by the Inland Revenue Department.

Contents

1Title
2Commencement
3Purposes
4Interpretation
5Meaning of unpaid amount
6Application of Act
7Application of Act to bonded scholarships
8Act binds the Crown
8AApplication of provisions of Act
9Purposes of sections 10, 11, 16, and 17
10Loan manager must notify Commissioner of persons who apply for student loan
11Commissioner must confirm information provided by loan manager
12Loan manager must provide copy of loan contract
13Certain information must be disclosed in loan contract
14Student loan establishment fee
15Right to cancel loan contract
16Loan manager must notify Commissioner of borrower’s details
16ALoan manager must notify Commissioner of any details held about borrower’s contact person
17Loan manager must transfer loan advance debts to Commissioner for collection
18Commissioner must notify borrowers of loan advances
19Commissioner must inform borrowers about consolidated loan balance
20Borrower must be notified of certain changes to obligations
21Overview of being New Zealand-based or overseas-based
22Meaning of New Zealand-based
23Meaning of overseas-based
24Treatment of partial days
25Commissioner may treat certain borrowers as being physically in New Zealand
26Method of making application and provision of evidence and information
27Commissioner must notify borrower and specify period or conditions when granting application
27ACommissioner must keep and publish list of charities
27BWhen entity qualifies to be listed as charity
27CApplication by entity to be listed as charity
27DCommissioner may list tax charities even if no application made
27ECommissioner may remove entity’s listing as charity
28Borrower to notify Commissioner of absence from New Zealand of 184 or more days
29Borrower to notify Commissioner of return to New Zealand of more than 183 days
30Borrower’s liability to repay consolidated loan balance
31Repayment obligations that apply to New Zealand-based borrowers and overseas-based borrowers
32Interrelationship between subparts 1 and 2
33Application of this subpart
34Repayment codes for New Zealand-based borrowers who derive salary or wages
35Borrowers with “SL” repayment code must notify employers
36Employer or PAYE intermediary must make standard deductions from salary or wages
37Deduction rates that apply to standard deductions from salary or wages
38Employer or PAYE intermediary must make Commissioner deductions from salary or wages
39Employer or PAYE intermediary must make borrower deductions from salary or wages
40Deductions from income-tested benefits
41Definitions relating to repayment thresholds
42Application for unused repayment threshold to be allocated to secondary employment earnings
43Determining estimated salary or wages
44Calculating borrower’s unused repayment threshold for pay period
45Special deduction rate certificate for unused repayment threshold
46Issue and application of special deduction rate certificate
47Ongoing obligations of borrower to review and notify
48Time when special deduction rate ceases to apply
49Commissioner must issue additional deduction rate notice to obtain Commissioner deductions
50Procedures for issue of additional deduction rate notice
51Assessment of standard deductions that ought to have been made
52Recovery of assessed amounts
53Definitions relating to exemption for full-time students
54Borrowers who are eligible for exemption from standard deductions
55Declaration by eligible borrowers for exemption from standard deductions
56Notice from Commissioner
57Consequences of exemption from standard deductions
58Withdrawal of declaration
59Notice of change of circumstances
60When exemption from standard deductions ceases to apply
61Information to show salary or wage deductions made
62Commissioner must determine question about amount of salary or wage deductions
63Commissioner determines what is significant under-deduction or significant over-deduction
64Standard deductions are full and final unless significant error
65Significant over-deduction identified by borrower
66Commissioner must determine whether significant over-deduction made
67Procedure if significant over-deduction made
68Applicable procedures if significant under-deduction
68ACommissioner over-deduction identified by borrower
68BCommissioner must determine whether Commissioner over-deduction made
68CProcedure if Commissioner over-deduction made
69Prohibition on applications or declarations to maintain integrity of student loan scheme
70PAYE rules apply to salary or wage deductions
71Salary or wage deductions in addition to income tax withheld
72Application of this subpart
73Meaning of adjusted net income, Schedule 3 adjustments, and related terms
74Notification of Schedule 3 adjustments
75Extension of time for notification of Schedule 3 adjustments
76Commissioner to assess borrower’s end-of-year repayment obligation
76ACommissioner must assess borrowers to whom section 72(b) applies as having zero repayment obligation
77Calculation of borrower’s end-of-year repayment obligation if salary or wages less than annual repayment threshold
78Calculation of borrower’s end-of-year repayment obligation where salary or wages equal to or more than annual repayment threshold
79Payment of end-of-year repayment obligation
80Calculation of terminal payment for tax year
81Due date for terminal payment
82Calculation of interim payments for next tax year
83Commissioner may assess interim payments if information for preceding year not provided
84Due dates for payment of interim payments
85Commissioner’s powers in relation to due dates
86Interim payments to be paid in same manner as provisional tax
87Consequence of failure to meet repayment obligations
[Repealed]
88Application of this subpart [Repealed]
88AMeaning of adjusted net income [Repealed]
89Commissioner to assess borrower’s other income repayment obligation [Repealed]
90Calculation of borrower’s other income repayment obligation where salary or wages below threshold [Repealed]
91Calculation of borrower’s other income repayment obligation where salary or wages equal to or above threshold [Repealed]
92Payment of other income repayment obligations [Repealed]
93Calculation of remaining repayments for tax year [Repealed]
94Due dates for payment of remaining repayments [Repealed]
95Calculation of interim payments for next tax year [Repealed]
96Commissioner may assess interim payments if information for preceding year not provided [Repealed]
97Due dates for payment of interim payments [Repealed]
98Commissioner’s powers in relation to due dates [Repealed]
99Interim payments to be paid in same manner as provisional tax [Repealed]
100Consequence of failure to meet repayment obligations [Repealed]
[Repealed]
101Borrower may apply for reduction of deduction rate to reflect lower repayment obligation [Repealed]
102Special deduction rate certificate for lower repayment obligation [Repealed]
103Issue and application of special deduction rate certificate [Repealed]
104Time when special deduction rate ceases to apply [Repealed]
105Application of this subpart
106Meaning of repayment holiday
107Borrowers who intend to be overseas-based may apply for repayment holidays
107AContact person to be nominated
107BGrant of repayment holiday
108Duration of repayment holiday
108ABorrowers who have had, or are having, repayment holidays under Student Loan Scheme Act 1992
109Assessments for years in which borrower is overseas-based
110Repayment obligations of overseas-based borrowers
111Exceptions to repayment obligations of overseas-based borrowers
112Repayment to be made by instalments
113Consequence of failure to meet repayment obligations
114Notification of Schedule 3 adjustments by New Zealand-based non-resident borrowers
114AExtension of time for notification of Schedule 3 adjustments
115Repayment obligations of borrowers who are overseas-based for part of tax year
115AReassessment of borrower’s overseas-based repayment obligations in year of return to New Zealand
116Overseas-based borrowers who derive salary or wages from New Zealand
117Overseas-based borrower’s standard and Commissioner deductions satisfy overseas-based repayment obligation [Repealed]
118Interpretation [Repealed]
119Meaning of excess repayment
120Commissioner must notify borrower of excess repayment
121Options that apply to excess repayments
122Exception to general rule if repayment obligations for prior tax years reassessed
[Repealed]
123Borrower’s entitlement to 10% bonus for excess repayment of $500 or more [Repealed]
124Borrower’s entitlement to bonus if loan balance is less than $550 [Repealed]
125Borrower may be entitled to 10% bonus if under-deduction is due to PAYE system [Repealed]
126Time at which 10% bonus is credited [Repealed]
127Restriction on amount of 10% bonus [Repealed]
128Application of sections 118 to 122 and this subpart to part years [Repealed]
129Consequences of refund or credit to next tax year [Repealed]
130Commissioner must advise borrowers to seek financial advice [Repealed]
131Limit on use of excess repayments
132Borrower may receive refund or apply excess repayment to future repayment obligations
133No interest applied to student loans except as specified in this Part
134Loan interest charged for all borrowers
135Loan interest calculated daily and charged and compounded annually
136Notification that loan interest has compounded
137Full interest write-off for New Zealand-based borrowers
138Loan interest written off for quick repayment of consolidated loan balance
139Late payment interest charged on unpaid amount
140Notification of late payment interest
141Late payment interest reduced if instalment arrangement complied with
141ALate payment interest reduced if deduction or extraction notice applies
142No interest on consolidated loan balance in credit
143Commissioner’s power to correct interest when charged in error
144Power of Commissioner in relation to small amounts
145Application for different types of relief for borrower
146Commissioner may grant relief from late payment interest
146ACommissioner may grant relief from penalties
147Hardship relief for any tax year
148Special deduction rate certificate for hardship relief
149Issue and application of special deduction rate certificate
150Time when special deduction rate ceases to apply
151Effect of Commissioner’s decision under section 147
152Borrowers must notify Commissioner of change of circumstances
153Commissioner may review grant of hardship relief
154Application for instalment arrangement
155Late notification penalty for Schedule 3 adjustments under section 74
156Due dates for payment of late notification penalty
157Definitions relating to student loan shortfall penalties
158Student loan shortfall penalties may be imposed on certain borrowers
159Commissioner may impose student loan shortfall penalties
160Notification and payment obligations if Commissioner imposes student loan shortfall penalty
161Student loan shortfall penalty reduced or removed to reflect change to shortfall penalty
161AUnderestimation penalty where interim payments underestimated as at last interim payment date
162Certain offence provisions in Tax Administration Act 1994 apply to borrowers
162AOffence for default of overseas-based repayment obligation
162BArrest of liable person
163Offence to prejudice employees because of student loan repayment liability
164Proceedings to be commenced by Commissioner
165Charging document may charge several offences
166Time for filing charging document
167Borrowers may object to details of loan advances
168Loan manager must consider objections
169Power to require objection to be determined by chief executive
170Chief executive must consider objections required to be determined by chief executive
171Right to apply to Disputes Tribunal or District Court
172Notification of Disputes Tribunal’s or District Court’s decision about objection
173Part 4A of Tax Administration Act 1994 applies to disputes under this Act
174Dispute process must be completed before challenge is made
174APart 8A of Tax Administration Act 1994 applies to challenges under this Act
175Challenge to details of consolidated loan balance
176Challenge to decision concerning treating borrowers as being physically in New Zealand
176AChallenge to decision relating to listing of entity as charity
177Challenge to special deduction rate certificate for unused repayment threshold
178Challenge to additional deduction rate notice
179Challenge to determination of salary or wage deduction
180Challenge to decision regarding significant over-deduction
181Challenge to prohibition on applications or declarations
182Challenge to assessments
182AChallenge to decision concerning repayment holiday
183Challenge to interest charged
184Challenge to decision concerning relief
185Challenge to late notification penalty
186Challenge to student loan shortfall penalty
187Person who may make challenge
188Commissioner’s decision on challenges [Repealed]
189Annual administration fee
190Tax year other than 12 months due to change in balance date
191Limit on repayment obligation for pay period or tax year
192Payment date not otherwise specified
193Recovery of unpaid amount
193AContact person may be requested to assist
193BChanges relating to identity and details of contact person
193CChanges relating to contact details of borrower
194Order in which salary or wage deductions and payments offset against borrower’s consolidated loan balance
195Date on which salary or wage deductions and payments treated as being made and credited
196Cancellation of interest if consolidated loan balance repaid early
197Write-off of consolidated loan balance
198Commissioner may remedy incorrect application of Act
199Manner of making refunds
200Appropriation of refunds
201Loan advances and other information may be altered
202Provisions of Tax Administration Act 1994 and Income Tax Act 2007 to apply to this Act
203This Act overrides loan contracts
204Commissioner may exercise rights in loan contracts to recall loans
205Loan contract enforceable against minor
206Student loan contracts are not credit contracts
207Disclosure of information between authorised persons
208Disclosure of information between Inland Revenue Department and New Zealand Customs Service for information-matching purposes
209Power of Commissioner to access arrival or departure information
209ADisclosure of information to Australian Taxation Office in relation to borrowers who are, or may be, overseas-based
210Meaning of inform
211Meaning of notify
212Meaning of notify a person in writing
213Meaning of formally notify [Repealed]
214Notice requirements of Tax Administration Act 1994 do not apply
215Regulations
216Transitional regulations [Repealed]
217Application of Legislation Act 2012
218Transitional provisions concerning loan manager and loan advances [Repealed]
219Early applications and issue of certificates for transition to this Act [Repealed]
220Application, savings, and transitional provisions
221Amendments to this Act [Repealed]
222Amendments to Student Loan Scheme Act 1992 and Credit Contracts and Consumer Finance Act 2003
223Amendments to other Acts
224Amendments to other enactments
225Student Loan Scheme Act 1992 repealed
226Regulations revoked
[Repealed]
[Repealed]
Reprint notes

The Parliament of New Zealand enacts as follows: