Student loan repayments are deducted automatically from your salary once you earn above a certain threshold. The amount you repay depends on which plan you are on — not on how much you borrowed. This guide explains each plan, the 2026/27 thresholds, and how repayments affect your take-home pay.
Which plan am I on?
Your repayment plan depends on when and where you took out the loan:
- Plan 1 — you started an undergraduate course in England or Wales before 1 September 2012, or studied in Northern Ireland at any time.
- Plan 2 — you started an undergraduate course in England or Wales on or after 1 September 2012.
- Plan 4 — you studied in Scotland (undergraduate or postgraduate loans from SAAS).
- Plan 5 — you started an undergraduate course in England or Wales on or after 1 August 2023.
- Postgraduate Loan — you took out a Postgraduate Master's or Doctoral Loan in England or Wales.
Your plan type is shown on your payslip and in your Student Loans Company (SLC) online account. If you have multiple loans (e.g. an undergraduate and a postgraduate loan), you will repay both simultaneously.
Repayment thresholds and rates 2026/27
You only repay when your gross income exceeds the threshold for your plan. The repayment is calculated as a percentage of everything you earn above that threshold.
| Plan | Annual Threshold | Monthly Threshold | Rate |
|---|---|---|---|
| Plan 1 | £26,900 | £2,241 | 9% |
| Plan 2 | £29,385 | £2,448 | 9% |
| Plan 4 | £33,795 | £2,816 | 9% |
| Plan 5 | £25,000 | £2,083 | 9% |
| Postgraduate Loan | £21,000 | £1,750 | 6% |
How is the repayment calculated?
The repayment is a percentage of your earnings above the threshold — not your total salary. For example, on Plan 2 with a £35,000 salary:
- Income above threshold: £35,000 − £29,385 = £5,615
- Annual repayment: £5,615 × 9% = £505
- Monthly deduction: approximately £42
In practice, the calculation is done on a monthly or weekly basis (like National Insurance), based on each pay period's earnings compared to the monthly threshold. Use the income tax calculator to see your exact student loan deduction alongside tax and NI.
Multiple loans at the same time
If you have both an undergraduate loan and a Postgraduate Loan, you repay both simultaneously. Each loan is assessed independently against its own threshold. For example, a £40,000 salary with Plan 2 and a Postgraduate Loan would result in:
- Plan 2: (£40,000 − £29,385) × 9% = £955/year
- Postgraduate: (£40,000 − £21,000) × 6% = £1,140/year
- Total student loan deductions: £2,095/year (£175/month)
When do repayments stop?
Repayments end when either you have repaid the loan in full, or the loan is written off — whichever comes first. Write-off periods:
- Plan 1 — written off when you turn 65 (loans taken out before 2006) or 25 years after the April you were first due to repay (loans from 2006 onwards).
- Plan 2 — written off 30 years after the April you were first due to repay.
- Plan 4 — written off 30 years after the April you were first due to repay (loans from 2007 onwards).
- Plan 5 — written off 40 years after the April you were first due to repay.
- Postgraduate Loan — written off 30 years after the April you were first due to repay.
Should I repay my student loan early?
Whether voluntary repayment makes sense depends on your balance, interest rate, and how much you earn. Key considerations:
- Plan 2 loans charge RPI + up to 3% interest while studying, then a sliding scale from RPI to RPI + 3% based on income. If your loan would be written off before you fully repay it, overpaying is essentially paying money you would never have owed.
- Plan 1 and Plan 4 loans have lower interest rates (RPI only). If you are a higher earner who will repay in full, overpaying saves you interest — but the returns may be less than investing the same money elsewhere.
- Plan 5 loans have a 40-year write-off and charge RPI + up to 3%. Given the long term, most borrowers will not repay in full, making voluntary repayment unwise for many.
See your student loan deduction
Use the income tax calculator to select your student loan plan(s) and see exactly how much is deducted from your salary each month. The calculator handles multiple simultaneous plans and shows the breakdown alongside income tax and National Insurance.