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Paying back student loans when you’re self-employed

If you’re a sole trader, contractor, or freelancer, you need to make student loan repayments on your income. But how do you calculate them?

Calculating your student loan repayments

If you have a student loan, as soon as you earn more than $19,448 you’re required to make repayments.

If you’re self-employed or earn income from other sources, you repay your student loan along with your income tax.

The amount of your student loan repayments depends on your adjusted net income.

Paying off your student loan if you’re self-employed (external link) — Inland Revenue

Making voluntary student loan repayments through the year will help spread the load.

Making voluntary student loan repayments through the year will help spread the load.

End-of-year repayments

Your end-of-year repayment is 12 percent of every dollar you earn over the student loan repayment threshold (currently $19,448).

You can manage your student loan using myIR, and if you’re having trouble meeting your repayment obligations, you can contact Inland Revenue through myIR or phone to discuss your situation. They might be able to offer some repayment options.

Register for myIR (external link) — Inland Revenue

Case study

Writing right

Anna is a freelance writer. In her first year of business after graduating university, she earns $40,000. This self-employed income is her only income for the year.

To calculate her end-of-year student repayment, she subtracts the annual repayment threshold from her income (currently $19,448), and multiplies the difference by 12 percent.

Adjusted net income (income aside from salary and wages) $40,000
Adjusted net income – annual repayment threshold ($40,000 - $19,448) $20,552
End-of-year repayment ($20,552 x 0.12) $2,466.24

You can find more examples on the Inland Revenue website (external link) .

Do you have more questions about student loan repayments?

Do you have more questions about student loan repayments?

Contact Inland Revenue on 0800 377 778.

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