Free tool · UK 2026/27 thresholds
UK Student Loan Repayment Calculator
What does your UK student loan actually cost you each month? Plan 1, 2, 4 (Scotland), 5 (post-2023), and Postgraduate Loan — with current thresholds, repayment rates, and projected total over the write-off period.
How UK student loan repayment actually works in 2026/27
UK student loan repayment is a percentage of income above a plan-specific threshold — not a percentage of the loan balance. This makes UK student loans behave more like a graduate tax than a conventional debt. You only repay above the threshold, the percentage is fixed, and any unpaid balance is written off after the plan's term (25-40 years depending on plan).
The five plans in 2026/27 with their thresholds and rates:
- Plan 1 — pre-September 2012 (England, Wales, Northern Ireland — and current NI students). Threshold £26,065. Rate 9%. Write-off 25 years after eligibility.
- Plan 2 — September 2012 to August 2023 (England, Wales). Threshold £28,470. Rate 9%. Write-off 30 years.
- Plan 4 — Scotland (all years). Threshold £32,745. Rate 9%. Write-off 30 years.
- Plan 5 — September 2023 onwards (England). Threshold £25,000. Rate 9%. Write-off 40 years.
- Postgraduate Loan — Master's loans. Threshold £21,000. Rate 6%. Write-off 30 years.
Why Plan 5 is structurally different
Plan 5 was introduced in September 2023 and represents a significant tightening of the UK student loan system. Three changes vs Plan 2: lower threshold (£25,000 vs £28,470), longer write-off period (40 years vs 30), and lower interest rate (RPI only vs RPI+3%). The lower threshold and longer term mean Plan 5 borrowers will repay considerably more in total than Plan 2 borrowers earning the same lifetime income — IFS modelling suggests Plan 5 borrowers will repay 80-90% of their balance on average vs 50-60% under Plan 2.
The 40-year write-off horizon is the crucial change. A Plan 5 borrower starting work at 22 will be repaying until 62 — most of a working life. Combined with the £25,000 threshold (well below median graduate salaries), Plan 5 functions much more like a debt and less like a graduate tax than older plans. For Plan 5 borrowers, overpaying makes sense more often because the projected total repayment is closer to or above the balance.
Postgraduate Loan stacking
The Postgraduate Loan was introduced in 2016 for English and Welsh master's students and is unusual in that it stacks on top of any undergraduate plan. A Plan 2 + Postgraduate Loan borrower earning £45,000 pays 9% × (£45,000 − £28,470) = £1,488 on Plan 2, plus 6% × (£45,000 − £21,000) = £1,440 on Postgraduate Loan, totalling £2,928/year or £244/month.
Postgraduate Loan repayment is income-contingent like the undergraduate plans, but the 6% rate and £21,000 threshold mean repayments start sooner and are smaller per pound earned. Because most master's students already have an undergraduate loan, the combined effect on take-home pay can be material — a £45k earner with both plans loses ~£244/month to student loan repayments before income tax and NI.
The interest question — RPI, RPI+3%, RPI cap, etc.
Student loan interest rates have been complex and politicised over the past decade. The current rules:
- Plan 1: lower of RPI or Bank of England base rate + 1%. Currently around 4-5%.
- Plan 2: was RPI+3% during study, then sliding scale 0% to RPI+3% based on income. Currently capped at 7.6% (uncapped would be higher than 9%).
- Plan 4: similar to Plan 1, capped.
- Plan 5: RPI only (no +3% loading). The most generous interest treatment.
- Postgraduate Loan: RPI+3%, capped at the same rate as Plan 2.
For most borrowers, the interest rate is academic — the loan will be written off before interest accumulation matters. Where it does matter: high earners on Plan 2 who will repay the full balance, where reducing interest accumulation could save thousands. Plan 5 borrowers don't have RPI+3%, so the interest concern is much smaller for them.
The overpayment question — when it makes sense
The single most important question for any UK student loan borrower: will I repay my full balance, or will I have it written off? The answer determines whether overpaying makes sense.
Don't overpay if you'll have it written off. Most middle-income Plan 2 graduates fall into this category — projected lifetime repayment of £30-50k against a £40-50k balance, with the rest written off after 30 years. Overpaying just gives HMRC money that would have been written off.
Consider overpaying if you'll repay the full balance plus interest over the term. This applies to high-earning Plan 2 borrowers (£60k+ throughout career), most Plan 1 borrowers (the 25-year term is shorter), and increasingly Plan 5 borrowers (40-year term + £25k threshold means more borrowers will repay in full). The calculator above shows projected total repayment vs balance — if projected total exceeds balance, overpayment saves interest.
The mortgage scenario. If you're applying for a mortgage and have a small remaining balance (a few thousand pounds), overpaying to clear it can unlock a larger mortgage by removing the monthly repayment from affordability calculations. This is one of the few cases where overpayment makes sense even when you'd otherwise have it written off — the mortgage uplift is often larger than the loan balance cleared.
Self-employed and student loan — the worst-case quirk
Self-employed UK student loan borrowers pay through self-assessment, not PAYE. The catch: the calculation uses your full annual profit, not pro-rated to the threshold. So a self-employed Plan 5 borrower with £30k profit pays 9% × (£30,000 − £25,000) = £450 in one annual instalment via January self-assessment. If profit fluctuates year-to-year, repayments fluctuate too — a £40k year produces a £1,350 repayment, a £20k year produces nothing.
Self-employed borrowers should ring-fence student loan repayment alongside income tax — adding it to the running 25-30% tax savings discipline. Pair this calculator with the UK self-employed tax calculator for the full picture.
Why I built this calculator
UK student loan rules are confusing — five plans, different thresholds, different rates, different write-off periods, separate Postgraduate Loan stacking. Most online calculators only show monthly repayment without the projection over the write-off period. The projection matters because it answers the most useful question: 'will I repay this in full or will some be written off'? The answer to that question shapes whether you should overpay, whether the loan affects your mortgage maths, and whether to think about the loan as debt or as graduate tax. Pair with the UK take-home pay calculator to see the full net pay picture including student loan deductions.
Common questions
- What are the UK student loan plans in 2026?
- Five UK student loan plans operate in 2026/27: Plan 1 (started before Sep 2012, threshold £26,065, 9% above), Plan 2 (started Sep 2012-Aug 2023 in England/Wales, threshold £28,470, 9% above), Plan 4 (Scotland, threshold £32,745, 9% above), Plan 5 (started Sep 2023+ in England, threshold £25,000, 9% above), and Postgraduate Loan (threshold £21,000, 6% above). Northern Ireland uses Plan 1. You can have a Plan plus a Postgraduate Loan running concurrently — the deductions are added together. Most undergraduates today are on Plan 5 (England) or Plan 2 (older); most postgrads have a separate Postgraduate Loan stacking on top.
- How is UK student loan repayment calculated?
- Student loan repayment is calculated on income above the relevant threshold for your plan, at 9% (or 6% for Postgraduate Loan). If you earn £40,000 on Plan 2 (threshold £28,470), you pay 9% × (£40,000 − £28,470) = £1,038/year ≈ £86/month. If you earn the same on Plan 5 (threshold £25,000), you pay 9% × (£40,000 − £25,000) = £1,350/year ≈ £113/month. Postgraduate Loan adds 6% × (£40,000 − £21,000) = £1,140/year on top. The repayment is automatic via PAYE for employees and via self-assessment for self-employed.
- When is my UK student loan written off?
- Write-off rules vary by plan. Plan 1: 25 years after the April you became eligible to repay (typically 25 years after graduation). Plan 2: 30 years after the April you became eligible. Plan 4 (Scotland): 30 years. Plan 5: 40 years — significantly longer than older plans, which is why Plan 5 borrowers should expect to repay for most of their working life. Postgraduate Loan: 30 years. Death and permanent disability also write off any UK student loan. Plan 5 borrowers will repay considerably more in total than Plan 2 borrowers because of the longer write-off horizon.
- Should I overpay my UK student loan?
- For most UK graduates, the answer is no. UK student loans are unusual — they're not really debts in the conventional sense. They're more like a graduate tax that ends when written off. If you'll repay more than your balance over the loan term, overpaying makes sense. If you'll repay less than your balance (most Plan 5 and many Plan 2 borrowers), overpayment is just giving HMRC money you wouldn't otherwise have paid. Use the calculator above to see your projected total repayment vs balance — if the projected total is below your balance, don't overpay. If above, overpaying saves you future interest. Most middle-income graduates are in the 'don't overpay' camp.
- How does student loan affect my mortgage application?
- Student loan repayments affect mortgage affordability calculations because they're treated as fixed monthly outgoings. A typical Plan 5 borrower earning £45k pays ~£150/month towards the loan — that £150 reduces the mortgage your lender will offer by roughly £30,000-£35,000 at 4-5x affordability multipliers. Some lenders calculate stricter, some more lenient. If you're applying for a mortgage in the next 6 months and your loan is a few thousand pounds, paying it off may unlock a meaningfully larger mortgage. If your loan balance is large (£30k+), this calculation flips — paying off can't realistically clear it. Check your lender's specific approach to student loans before deciding.
- Can I have multiple UK student loans?
- Yes. The most common combination is an undergraduate plan (Plan 1, 2, 4, or 5) plus a Postgraduate Loan, which stack and deduct concurrently. If you somehow have two undergraduate plans (rare — typically only happens after returning to UK from overseas study), the more recent plan usually applies. Some borrowers studying internationally end up with multiple plans across different jurisdictions. For PAYE employees, the deductions are usually combined — your payslip will show the combined deduction not split by plan. Self-employed borrowers see separate lines on self-assessment.
- What happens to my student loan if I move abroad?
- Student loan obligations follow you abroad. You must notify Student Loans Company within 3 months of leaving the UK and provide expected income. The UK threshold may be adjusted for cost of living in some countries — SLC publishes country-specific thresholds. You repay directly rather than via PAYE. Many UK graduates move abroad and stop receiving SLC communications, which results in a 'fixed instalment' default — usually £246/month or more — until they re-engage. If you're moving abroad, set up the notification proactively. If you're in default abroad, contact SLC to switch back to income-based.