Borrower Payments or SLBOR
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- Last Updated: Monday, 11 November 2019 02:28
Borrower Payments.
These are completely optional extra deductions that the employee wishes to make and require no approval by I.R. They are completely independent from all other student loan deductions and are shown separately under the SLBOR code on the return to I.R.
All other repayments are subject to an earnings threshold, currently $374 per week for employees on the M codes. The standard 12% is deducted from taxable Gross earnings minus the threshold. For secondary codes the % rate applies on all Gross earnings.
The BOR % rate always applies to total Gross Earnings, (no threshold) regardless of other rates.
On the KeyPay employee file page 1 option L pop-up dialog, the last line allows entry of the SLBOR. It can be a % rate from 1 to 25 - entered as 0.10 to 0.25. Above this - from 0.26 to 999.99 it represents a fixed $ amount. Thus an employee could decide that he/she could afford to always repay say $10 each payday, rather than a percentage. Conversely, $10 might be too much when earnings are frequently low and a percentage might make more sense. Its also possible that an employee who knows they are in arrears could avoid higher compulsory deductions if I.R observe that an effort is already being made. Either way BOR is the employees choice as they see fit.