Create Student Loan or Postgraduate Loan Deductions

To create student or postgraduate loan deductions, you must create a Court Orders and Student Loans calculation card. And, you need to add one or more calculation components to the card.

Before You Start

Before you can create a student loan or postgraduate loan deduction for an employee, you must do these:

1. Create the student loan or postgraduate loan element.

2. Define the element eligibility.

3. Create the payee for the student loan or postgraduate loan.

   Use the Third-Parties task to define the party that should receive the student loan or postgraduate loan payment. In the Party Usage Code field, select External Payee.

Create the Calculation Card

Here's how you can create a Court Orders and Student Loans calculation card:

1. Select the Calculation Cards task in the Payroll Calculation work area.

2. Search for and select the person for whom you want to create the calculation card.

3. Click Create.

4. On the Create Calculation Card screen, select the calculation card name Court Orders and Student Loans.

5. Click Continue.

   Note: Creating the calculation card automatically creates a Court Order Information component. You must add the student loan or postgraduate loan component.

Add the Student Loan or Postgraduate Loan Component

To add court order component and component details, follow these steps:

1. In the Calculation Components section, click Add Row.

   Note: This lists all the elements created for primary classification Involuntary Deductions and secondary classification for the court orders and student loans.

2. In the Create Calculation Component window, complete the fields as follows:

   • Select the Calculation Component with the same name as the previously defined student loan or postgraduate loan element.

   • Enter a Reference Code to uniquely identify this deduction. For example, student loan or postgraduate loan number or other identifier.

3. Click OK.

   The calculation component displays the student loan or postgraduate loan that you created as a new record. The application automatically creates the corresponding component details.

4. In the calculation component details, click Create.

   You can identify student loans as Plan 1, Plan 2, Plan 4, or select one of the appropriate combinations.

5. Enter all the other relevant date details for the loan.

6. Click Save.

Define Associations

You must associate the student loan or postgraduate loan component with the tax reporting unit (TRU).

If you've already allocated a court order component to the employee, you still need to add another association record for the loan component.

If no previous association exists, or if the employee has no court order allocated, create the association for the student loan or postgraduate loan.

Note: If you don't create the association for the student loan component in the Associations tab, the payroll doesn't process its calculations.

To create associations for the student loan component:

1. Select the Calculation Cards task in Payroll.

2. Select the Court Orders and Student Loans calculation card for the employee.

3. In the Associations section, click Create.

4. In the Update Associations page, select the TRU.

5. Select the appropriate loan component.

   Note: You can't associate more than one TRU with the student loan or postgraduate loan component.

6. Click Save and Close.

New Starter Declaration

You can also allocate student and postgraduate loans by these methods:

• A professional user can enable the options from the notifications section of the PAYE component in the Statutory Deductions calculation card. Here are the options that you can select:
  • Enable automatic student loan updates
  • Enable automatic postgraduate loan updates
• An employee can also use the new starter declaration through employee self-service.

  By default, the application enables the profile ORA_HRX_GB_PAY_NSD_APR2021. You can disable it to use the earlier version of the employee self-service declaration that doesn't have the new plan option listed.

• You can enable Redwood experience for New Starter Declaration page for your employees through employee self-service. This form replicates the HMRC paper form, and is an employee statement to their employer regarding their tax, and student or postgraduate loan status. To enable any of the Redwood pages, the central profile option ORA_HCM_VBCS_PWA_ENABLED (Enable VBCS Progressive Web Application User Interfaces across HCM application) needs to be set to Yes. For more information, see HCM Redwood Pages with Profile Options.

  Here are the steps to enable the New Starter Declaration profile for employee self service:

  1. Navigate to the Setup and Maintenance area and search for the Manage Administrator Profile Values task.
  2. On the Manage Administrator Profile Values page, search for and select the ORA_HRX_GB_VBCS_ESS_NSD profile option.
  3. Select Yes in the Profile Value field.
  4. Click Save and Close.