How to repay a student loan in the UK?
Depending on how often you make payments, you will pay a percentage of your income over the income ‘threshold’ for your type of student loan. The income limit is different for each plan type. If you are on Plan 1, 2, 4 or 5 you will pay one of two payments: 9% of your income over the threshold.
What repayment plan are you on?
When you start paying off your loan and how much you pay depends on your repayment plan.
If you’re not sure which repayment plan you’re on, you can sign in to your online account to check.
You cannot choose your repayment plan. If you have more than one loan, you may be on different plans.
How to start repay
You will only repay your student loans when your income is above the threshold amount for your repayment plan, unless you have been overpaid.
Your income is the amount you earn before taxes and other deductions (including things like bonuses and overtime).
The threshold amount changes on April 6 every year.
The earliest you will start paying is:
- April after you leave your course
- If you are studying part-time and your course is longer than 4 years, then April 4 years after the course started
- April 2026, if you are on Plan 5
Your payment automatically stops if either of the following occurs:
- You stop working
- Your income falls below a threshold
If you have a Plan 1 student loan
You’ll only repay when your income is over £501 a week, £2,172 a month or £26,065 a year.
If you have a Plan 2 student loan
You’ll only repay when your income is over £547 a week, £2,372 a month or £28,470 a year.
If you have a Plan 4 student loan
You’ll only repay when your income is over £629 a week, £2,728 a month or £32,745 a year.
If you have a Plan 5 student loan
You’ll only repay when your income is over £480 a week, £2,083 a month or £25,000 a year.
Early repayments
There’s no penalty for paying some or all of your loan off early.
How to repay
If you are an employee, your payment will be taken from your salary, along with tax and National Insurance. Your payslip will show how much has been deducted. You should check that you are on the right repayment plan with your employer.
There is no penalty if you make an extra payment to pay off some or all of your loan early.
Are you self-employed?
HM Revenue and Customs (HMRC) will decide how much you pay from your tax return. You pay at the same time you pay your tax.
If you are an employee and file a tax return
If you earn more than the minimum amount, your employer will deduct the loan repayment from your salary.
Check your payslip or P60 to see how much you paid off your loan during the tax year. You will need to include this information when you file your tax return.
Can student loans be written off in the UK?
If you took out your first loan during or before the 2005–2006 academic year, any remaining loan will be written off when you reach 65 . If you took out your first loan during or after the 2006–2007 academic year, any loan not repaid will be written off 25 years after you started repayment.
How are student loans repaid in the UK?
You’ll repay a percentage of your income over the income ‘threshold’ for your type of loan, depending on how often you get paid. The income thresholds are different for each plan type. You’ll repay either: 9% of your income over the threshold if you’re on Plan 1, 2, 4 or 5.
Will the UK forgive student loans?
Student loans aren’t ‘forgiven’ in the UK the way they are in the US, but they can be written off eventually, meaning the debt will be wiped and you won’t have to continue making contributions.
Who owns student debt in the UK?
Student Loans Company Limited (SLC) is an executive non-departmental public body company in the United Kingdom that provides student loans. It is owned by the UK Government’s Department for Education (85%), the Scottish Government (5%), the Welsh Government (5%) and the Northern Ireland Executive (5%).
Does UK student loan affect credit?
From a long-term financial point of view, student loan repayments do not directly affect your credit score. This is because they won’t show up in your credit report as they’re deducted from your future income automatically with a fixed percentage after graduation.
