How student loan repayments work
Student loan repayments depend on what you earn, not on how much you borrowed. You repay a fixed percentage of your income above a threshold, and nothing at all in a month when you earn less. If you're employed, your employer takes the repayment through PAYE alongside tax and National Insurance. If you're self-employed, it's added to your Self Assessment bill.
The calculator works out your yearly repayment as 9% of your salary above your plan's threshold (6% for a Postgraduate Loan), then divides by 12 for the monthly figure.
Student loan thresholds for 2026/27
| Plan | Yearly threshold | Monthly threshold | Rate | Written off after |
|---|---|---|---|---|
| Plan 1 | £26,900 | £2,241 | 9% | 25 years* |
| Plan 2 | £29,385 | £2,448 | 9% | 30 years |
| Plan 4 (Scotland) | £33,795 | £2,816 | 9% | 30 years* |
| Plan 5 | £25,000 | £2,083 | 9% | 40 years |
| Postgraduate Loan | £21,000 | £1,750 | 6% | 30 years |
*Older Plan 1 and Plan 4 loans taken out before 2006 or 2007 are written off at age 65 instead. Write-off is counted from the April after you were first due to repay. The Plan 2 threshold will be frozen at £29,385 from April 2027 until April 2030.
If you have both an undergraduate plan and a Postgraduate Loan, you repay both at the same time: 9% above your plan threshold and another 6% above £21,000.
Worked example: £35,000 salary on Plan 2
That's about £42.08 a month. On Plan 1 the same salary repays £729 a year (£60.75 a month), and on Plan 5 it's £900 a year (£75 a month). Payroll works it out each pay period, so the exact amount on your payslip can vary by a few pence.
Will my student loan ever be paid off?
To estimate this, the calculator runs a simple year-by-year model:
- Interest for the year is added: balance × interest rate.
- Your repayment for the year is taken off, based on your salary that year.
- Your salary grows by the pay rise you entered, and the next year begins.
It stops when the balance reaches zero or the loan is written off. Thresholds are kept at 2026/27 levels, and the interest rate is held steady, so treat the answer as a rough guide rather than a forecast.
With the default figures (a £45,000 Plan 2 balance, £35,000 salary, 4.1% interest and 3% yearly pay rises), the interest of around £1,845 in the first year is far more than the £505 repayment. The balance keeps growing, you repay about £70,500 over 30 years, and the remaining £40,196 is written off.
Compare that with a £10,000 Plan 1 balance on a £40,000 salary: you repay £1,179 in the first year and clear the loan in 8 years.
Should I make extra repayments?
For many Plan 2 and Plan 5 borrowers, overpaying doesn't make sense. If your loan is likely to be written off before you clear it, any extra you pay is money you'd never have had to pay. Overpaying only saves money if you're on track to repay the whole balance anyway, typically higher earners or people with small balances. It often makes more sense to build savings, pay off credit cards or add to your pension first.
See how repayments fit with tax and National Insurance on the take-home pay calculator, or compare with commercial borrowing on the loan calculator.
Tips
- Check your plan type in your Student Loans Company online account. Paying on the wrong plan is a common payroll error.
- If you earned below the threshold for the whole tax year but repayments were taken, you can claim a refund from the Student Loans Company.
- Repayments are based on gross pay, so salary sacrifice pension contributions reduce them.
Frequently asked questions
How much will I repay on my student loan on £30,000?
On £30,000 in 2026/27 you repay £55 a year (about £4.58 a month) on Plan 2, £279 a year on Plan 1 and £450 a year on Plan 5. On Plan 4 you repay nothing because £30,000 is below the £33,795 threshold.
What is the Plan 2 threshold for 2026/27?
The Plan 2 repayment threshold is £29,385 a year (£2,448 a month) for 2026/27. It will be frozen at that level from April 2027 until April 2030.
When is a Plan 2 student loan written off?
Plan 2 loans are written off 30 years after the April you were first due to repay. Plan 5 loans are written off after 40 years and most Plan 1 loans after 25 years.
Does my student loan affect my credit score?
No. Student loans from the Student Loans Company don't appear on your credit file, although mortgage lenders may take the monthly repayment into account when working out what you can afford.
Do I pay a Postgraduate Loan and Plan 2 at the same time?
Yes. You repay 9% of income above the Plan 2 threshold and 6% of income above £21,000 for the Postgraduate Loan at the same time.
Last reviewed October 2026 using 2026/27 figures. This calculator gives an estimate for guidance only.