Student Loan Holiday Ends

September 25, 2010 New Zealand Taxation

fifty ovalThe Inland Revenue Department’s three year long payment holiday for overseas based student-loan holders has come to an end.

On September 24th the Inland Revenue Department (IRD) issued a statement reminding overseas student loan holders that their repayment holidays have expired and that their first payment is due this month.

The repayment holiday was originally started in 2007, as a means to grant a reprieve from payments to student loan holders who are working overseas. The program was initiated concurrently with an amnesty to borrowers whose accounts were in debt.

The IRD has already sent out letters to a significant proportion of student loan holders, updating them on their payment obligations. However, due to the mobile nature of some individuals, the IRD has not been able to make contact. The IRD has stated that it will not accept ignorance to the changes as a valid justification for missing repayments, and will proceed to charge interest penalties on any overdue amounts.

Charles Ronaldson, IRD Group Manager of Assistance, has urged friends and families of overseas based student loan holders to remind them to check their obligations. He also reminded borrowers that they are still able to receive a 10 percent bonus on their repayment if making a extra payment of NZD 500 or more.

Photo by NZ Alex