UK Student Loan Calculator 2026: Plan 1, 2, 4 and 5 Repayments Explained
How much UK student loan you actually repay each month in 2025-26, the four different repayment plans, the income thresholds and 9% rule, and the worked monthly costs for £30K, £40K, £60K and £80K salaries — including why most Plan 5 borrowers will repay for the full 40 years.
By FreeFinCalc Editorial · Updated April 9, 2026 · UK 2025-26 tax year data
UK student loans are deducted from your salary like a graduate tax: 9% of every pound you earn above a fixed income threshold, taken straight from your payslip via PAYE. The threshold and the write-off period both depend on which Plan you are on, which depends on when and where you started your course. In 2025-26 there are five different plans active: Plan 1 (England/Wales pre-2012, NI/Scotland old loans), Plan 2 (England/Wales 2012-2023), Plan 4 (Scotland post-2007), Plan 5 (England post-August 2023), and the postgraduate Plan 3. Repayments stop entirely if your salary falls below the threshold. The system is described as a loan but functions more like a graduate tax — most graduates never repay the full balance.
UK Student Loan Plans Compared (2025-26)
The five plans active in 2025-26 with their thresholds, repayment rates, write-off periods and current interest rates.
| Plan | Who | Threshold | Rate | Interest | Write-off |
|---|---|---|---|---|---|
| Plan 1 | Eng/Wales pre-Sept 2012, NI | £26,065 | 9% | 4.3% | 25 years or age 65 |
| Plan 2 | Eng/Wales Sept 2012 - July 2023 | £28,470 | 9% | Up to 7.3% | 30 years |
| Plan 4 | Scotland | £32,745 | 9% | 4.3% | 30 years |
| Plan 5 | Eng from Aug 2023 | £25,000 | 9% | RPI only | 40 years |
| Plan 3 (PG) | Eng/Wales postgraduate | £21,000 | 6% | RPI + 3% | 30 years |
Worked Monthly Repayments by Salary (2025-26)
How much is deducted from your salary each month under each plan at common income levels. Note: if you are on multiple plans (e.g. undergraduate Plan 2 plus postgraduate Plan 3), they stack on top of each other.
| Gross salary | Plan 1 (£26,065) | Plan 2 (£28,470) | Plan 4 (£32,745) | Plan 5 (£25,000) |
|---|---|---|---|---|
| £25,000 | £0 | £0 | £0 | £0 |
| £30,000 | £29 | £11 | £0 | £37 |
| £35,000 | £67 | £49 | £17 | £75 |
| £40,000 | £104 | £86 | £54 | £112 |
| £50,000 | £179 | £161 | £129 | £187 |
| £60,000 | £254 | £236 | £204 | £262 |
| £75,000 | £367 | £349 | £317 | £375 |
| £100,000 | £554 | £536 | £504 | £562 |
Plan 5 — The Harshest Plan in Practice
Plan 5 was introduced for English students starting university in August 2023 onwards. On paper it looks similar to Plan 2, but two changes make it dramatically worse in practice: the threshold dropped from £28,470 to £25,000 (so repayments start sooner and are larger throughout your career), and the write-off period extended from 30 to 40 years. Department for Education modelling estimates 65% of Plan 5 borrowers will repay the full loan in real terms before write-off, compared to about 17% of Plan 2 borrowers. For most Plan 5 students the loan is no longer "graduate tax"-like — it is a real debt that will be repaid. The threshold is also frozen until 2027, dragging more graduates into repayment each year.
Should You Pay Off Your Student Loan Early?
For most Plan 1, Plan 2 and Plan 4 borrowers the answer is NO. Because the loan is income-contingent and written off after 25-30 years, the majority of graduates never repay the full amount — the actual cost of the loan is whatever you pay over your career, capped at the write-off date. Voluntary overpayments only save you money if you would otherwise have repaid the loan in full anyway, which most Plan 1/2/4 borrowers will not. The exceptions where overpayment may make sense: high-earners who will definitely repay in full and are paying high interest rates (Plan 2 only); borrowers nearing the write-off date who can clear a small remaining balance to stop monthly deductions; and Plan 5 borrowers (the new English plan) where most will repay in full anyway.
How Repayments Are Collected
Student loan repayments are collected through PAYE, just like income tax. Your employer is told by HMRC which Plan you are on, and they deduct 9% of your pay above the relevant threshold automatically. Repayments are taken on actual monthly pay (not annualised), so a one-off bonus or commission payment can trigger a large one-off student loan deduction even if your annual income would not. Self-employed borrowers pay through Self Assessment. You can check your balance and statements at studentloanrepayment.co.uk. Overpayments above the required amount can be requested refunded if your annual income did not actually exceed the threshold.
Frequently Asked Questions
When do UK student loan repayments start?+
Repayments start in the April following the date you finish your course (graduation, drop-out, or course end), and only when your salary exceeds your Plan threshold. So if you graduate in July 2026, your first possible repayment is in April 2027, and only if you are then earning above the threshold for your plan. Repayments are deducted automatically through PAYE by your employer if you are employed.
What is Plan 5 student loan?+
Plan 5 is the new repayment plan for students in England who started university courses on or after 1 August 2023. The threshold is £25,000 (lower than Plan 2 at £28,470), the rate is 9% of income above the threshold, and the write-off period is 40 years (versus 30 for Plan 2). The interest rate is RPI only, with no real-rate add-on. Plan 5 is harsher than Plan 2 in practice — Department for Education modelling estimates 65% of Plan 5 borrowers will repay the full loan in real terms.
Will my student loan be written off?+
Plan 1 loans are written off 25 years after the April you became eligible to repay, or when you turn 65 (whichever comes first). Plan 2 and Plan 4 loans are written off after 30 years. Plan 5 loans are written off after 40 years (so a 21-year-old graduate would not see write-off until age 61 or so). Death and severe disability also trigger write-off on all plans. Most Plan 1 and Plan 2 borrowers reach write-off without repaying in full; Plan 5 borrowers mostly will not.
How much is the student loan interest rate in 2026?+
Plan 1 and Plan 4 are charged the lower of the Bank of England base rate plus 1% or RPI — currently around 4.3%. Plan 2 charges RPI + 3% while studying, then a sliding scale of RPI to RPI + 3% based on income after graduation, currently capped at 7.3%. Plan 5 charges only RPI (no add-on). Postgraduate Plan 3 charges RPI + 3% throughout. Interest rates change annually based on the previous September RPI figure.
Should I pay off my student loan early?+
For most Plan 1, Plan 2 and Plan 4 borrowers, no. The loan is income-contingent and written off after 25-30 years, and most graduates never repay in full. Voluntary overpayments only help if you would otherwise have repaid in full anyway. The exceptions: high-income Plan 2 borrowers who will definitely repay (the high interest rate makes overpayment worthwhile), borrowers very close to write-off who can clear a small balance, and Plan 5 borrowers who will mostly repay in full and benefit from clearing the debt sooner.
Do I have to repay my student loan if I work abroad?+
Yes. Living abroad does not stop your obligation to repay. You must complete an Overseas Income Assessment Form each year and pay directly to the Student Loans Company based on the income threshold for your country (different countries have different thresholds because of differing living costs). Failing to do so leads to fixed penalty repayments (often higher than what you would owe based on actual income), interest accrual, and ultimately legal action — they have caught up with non-payers globally in recent years.
Can my student loan affect my credit score or mortgage?+
A student loan does not appear on your credit file, so it does not directly affect your credit score. However, mortgage lenders DO consider your student loan repayments as a fixed monthly outgoing when calculating affordability — same as a car loan or rent payment. A graduate earning £45,000 with a £150 a month student loan repayment can borrow roughly £20,000 less than the same graduate without a student loan deduction. This is one of the few ways student loans actively impact your finances.
What happens if I do not earn above the threshold?+
You pay nothing. UK student loans are income-contingent, meaning if your salary in any month falls below the threshold for your plan (Plan 5 = £2,083 a month, Plan 2 = £2,372 a month, etc.), no repayment is taken from that pay period. There is no minimum repayment, no penalty for non-repayment, and no impact on your credit. If your annual income across the whole tax year is below the threshold but you had monthly deductions because of bonuses, you can claim a refund.
Sources & Disclaimer
Student loan plans and thresholds 2025-26: Student Loans Company and gov.uk. Plan 5 introduction: Department for Education response to higher education funding consultation 2022. Interest rates: Student Loans Company interest rate updates. Modelling of Plan 5 repayment outcomes: IFS Higher Education Funding Briefing. Repayment thresholds frozen until 2027: HM Treasury. This article is for educational purposes only and is not personalised financial advice.