Until recently, compulsory payments for student loan borrowers living overseas reduced when their balances reduced. 

This is no longer the case. If you were overseas on 31 March 2014 your compulsory payment will be based on that level of debt, no matter how much the debt reduces. If your debt goes up your compulsory payment may also increase.

Stuff reports an alarming increase in people hurting themselves because of issues with the IRD.

Owing money to the IRD puts many people under extreme stress to the point where they self harm or become suicidal. This is an awful position to be in. If you know anyone like this please tell them that there is help available. Both for how they feel and to deal with the IRD. We can fix your problems with the IRD but if you need other help please check the list below.

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Lifeline: 0800 543 354 - Provides 24 hour telephone counselling

Youthline: 0800 376 633 or free text 234 - Provides 24 hour telephone and text counselling services for young people

Samaritans: 0800 726 666 - Provides 24 hour telephone counselling.

Tautoko: 0508 828 865 - provides support, information and resources to people at risk of suicide, and their family, whānau and friends.

Whatsup: 0800 942 8787 (noon to midnight)

If it is an emergency or you feel you or someone you know is at risk, please call 111

For information about suicide prevention, see http://www.spinz.org.nz

The IRD has started to use  the Courts in some Australian states to sue NZ student loan debtors who are behind in paying. We are told that this trial will soon be rolled out across Australia. Other countries are likely to be next. 

The IRD's usual practice is to bankrupt people it has sued. 

What can you do? If there is a possibility you will need to go bankrupt, you are better off to choose your own timing for this, rather than letting the IRD do this for you. If you are put into bankruptcy by the IRD there is a much greater chance that the bankruptcy will last longer than the usual three years. Please contact us to discuss your situation. In some cases it will be possible for you to choose whether to go bankrupt now, or at a future date that suits you better.

If you want to avoid bankruptcy, please contact us as soon as possible so we can discuss the other options and  get the IRD's agreement to your plan. If you wait until legal proceedings are served on you by the IRD, you will be in a weaker negotiating position, under extreme stress to find a quick solution, and it is  likely  that some of the resolution options will no longer be available to you.

Stuff reports a large increase in self harm threats from people who money to the IRD:

This reflects our experience with clients who owe the IRD money. Many are very distressed. Some are suicidal. We can provide stress relief by taking the burden off your shoulders and by providing quick and effective solutions like bankruptcy and negotiating directly with the IRD on your behalf. 


For other help, please visit:


HELPLINES 

Lifeline: 0800 543 354 - Provides 24 hour telephone counselling

Youthline: 0800 376 633 or free text 234 - Provides 24 hour telephone and text counselling services for young people

Samaritans: 0800 726 666 - Provides 24 hour telephone counselling.

Tautoko: 0508 828 865 - provides support, information and resources to people at risk of suicide, and their family, whānau and friends.

Whatsup: 0800 942 8787 (noon to midnight)

If it is an emergency or you feel you or someone you know is at risk, please call 111

For information about suicide prevention, see http://www.spinz.org.nz.

We were quoted in a Stuff article about the large increase in student loan debtors who are choosing to go bankrupt. We  are very experienced in acting for student loan debtor clients who choose bankruptcy. Some of the key facts are:

• There has been a large increase in student loan debtors seeking bankruptcy. We think most of this is due to increased aggressiveness from the IRD and its debt collectors. People are being harassed to pay large debts that, in many cases, they didn't even know existed.
• The IRD sometimes refuses to be reasonable when people want to come to a payment arrangement leaving the debtor with no choice but to go bankrupt. The IRD ends up with nothing. 
• Most of our bankruptcy clients only have one debt - a New Zealand student loan. Some have other debts too, but it is quite clear that student loans are a significant cause of bankruptcy and that this is an increasing problem.
• Many student loan debtors are in a situation where even if they can afford the overseas compulsory annual payments, the student loan debt will never be repaid in their lifetime. If they don't become bankrupt, the loan will hang like a millstone around their neck forever.
• If your situation makes you a good candidate for bankruptcy, you are better off doing this when it suits you and your life, rather than having it done to you later when it suits the IRD and when you may have built up assets that could be at risk.
• Nobody has ever said to us that they see bankruptcy as an easy way to get out of paying their debts. People want to do the right thing, but sometimes they are angry because of the way they are treated by the IRD, or bankruptcy is the only realistic financial option. 
• If you live overseas there may be  a nil impact on your credit rating from a New Zealand bankruptcy.
• If you live overseas your assets may be safe. Everyone's situation is different, and needs to be carefully advised on, but the end result is that for many people living overseas, going bankrupt in New Zealand can be painless.
• Other countries treat their student loan debtors with more care. If you have an Australian student loan debt, no repayments have to be made  until you earn more than $50,000 a year. In the United States, student loans can be forgiven if the borrower does voluntary work or works in the public service. 

Please contact us for confidential advice on your situation and options.

We help many student loan debtors to negotiate a good outcome with the IRD. Results can include substantial reductions in the debt owed, hardship arrangements so that nothing needs to be paid for a period of time, and payment arrangements. If you use us you will be sure that all possible options have been considered, including those are best for you. We have the right contacts to help you.

Many people have bad experiences when they try to negotiate directly with the IRD. Examples include:

• Borrowers who are not given all the possible options by the IRD, just the ones that suit the IRD.
  
  
• Borrowers who pay money to the IRD because are told that they will receive a write off when there was never any intention by the IRD to provide this.
  
  
• Borrowers who receive letters from the IRD where the arrears amount misleadingly appears to be the full amount of the debt. The person pays the arrears amount thinking this is the end of the matter and then the IRD asks for more – much more.
  
  
• Borrowers who find that the IRD provides their personal details to other borrowers.
  
  
• Borrowers who are told by the IRD that their loan is paid off, and then they find years later that the IRD made a mistake and the actual debt is now tens of thousands of dollars. The IRD then aggressively pursues the borrower, not caring about the stress and hardship caused by their mistake.
  
  
• Borrowers who have been told by the IRD that they can't declare bankruptcy from overseas (wrong).
  
  
• Borrowers who are told by the IRD that the no assets procedure is just as good as bankruptcy (it doesn’t get rid of your student loan).

Please contact us to discuss your situation and how we may be able to help.

Interest is charged on student loans for borrowers who live outside New Zealand, in most cases. Currently interest is not charged on loans for New Zealand residents, although some right wing politicians would like to see all borrowers pay interest. 

What happens if you live overseas, but move back to New Zealand? In most cases, if you are in New Zealand for 183 days, or more, you can be treated as a New Zealand resident and new interest won't be charged to your account. During the 183 days you are allowed to be overseas for up to 31 days in total without losing the benefit of no interest. 

If you have a large loan, moving back to New Zealand could be financially worthwhile. 

If you are someone who has had periods of moving in and out of New Zealand, you should check that the IRD has the right information on file. We have seen many cases where people have been wrongly charged interest even though they have been in New Zealand for more than 183 days. There are also many cases where the IRD didn't know that the person had left New Zealand and interest wasn't charged until many years later at which point the IRD generally adds a catastrophically large amount of interest and penalties to the person's account.

Please contact us if we can help.

This is a note of thanks that we received recently from a student loan debtor client who had been driven to the brink of suicide by the IRD:

No matter how bad your situation is, it is likely that we can help. Please contact us in confidence to discuss your situation.

Recently a child support debtor was arrested at Wellington Airport. Our IRD sources tell us that no student loan debtors have been arrested yet, but they are actively working on some cases and that arrests can be expected in the near future. 

One of our clients recently returned to New Zealand for a holiday. The IRD contacted us to advise that airport records showed that our client had recently entered the country. In another case, a new client with an IRD debt had been told to provide the IRD with banking information. They didn't do so. We became involved and the IRD told us forget about the bank information as they had already forced the bank to provide disclosure (without the taxpayer's knowledge). The point is that if you are a student loan debtor with arrears that you are probably being watched very closely.