Student loan repayments 2026/27: what comes off your payslip
The 2026/27 thresholds by plan
| Plan | Who has it | Annual threshold | Rate | Monthly on £35,000 |
|---|---|---|---|---|
| Plan 1 | Pre-2012 starters (England/Wales), Northern Ireland | £26,900 | 9% | £61 |
| Plan 2 | England starters 2012 to 2023, Wales starters from 2012 | £29,385 | 9% | £42 |
| Plan 4 | Scottish students | £33,795 | 9% | £9 |
| Plan 5 | England starters from August 2023 | £25,000 | 9% | £75 |
| Postgraduate | Master's and doctoral loans | £21,000 | 6% | £70 |
The percentage applies only to the slice above the threshold, not to the whole salary. A Plan 2 borrower on £30,000 keeps £25,064.25 for the year against £25,119.60 without a loan: the loan costs far less than people fear at modest salaries, and nothing at all below the threshold.
Why your deduction jumps around
Repayments are calculated per pay period, not annually. A bonus month can push one paycheck over the monthly threshold and trigger a deduction even when your annual salary sits below the annual figure. Unlike income tax, this is never smoothed out later in the year, though you can reclaim it from the Student Loans Company if your total pay stayed under the annual threshold, once the tax year has ended and SLC has confirmed your income with HMRC.
Plan 2 and the interest question
For most graduates the realistic question is not the balance but the monthly cost, because any remainder is written off after the plan term (25 to 40 years depending on plan; some older Plan 1 and Plan 4 loans are written off at age 65 instead). Paying extra only helps if you are likely to clear the loan before write-off, which usually means high and rising earnings. Run your own salary with and without the loan in the UK salary calculator to see the real monthly difference.
Two loans at once
An undergraduate plan and a postgraduate loan repay at the same time: 9% above your plan threshold plus 6% above £21,000, a combined 15% band for earnings above both. The bonus calculator shows how a one-off payment interacts with each.
Frequently asked questions
Do student loans affect my tax code?
No. They are a separate payroll deduction HMRC instructs your employer to take, shown as its own line on the payslip.
Should I pay my loan off early?
Only if you expect to repay the full balance before write-off anyway. Most Plan 2 borrowers never do, so overpayments often buy nothing. This is general information, not financial advice.
What happens if I move abroad?
You must tell the Student Loans Company and repay directly at thresholds set per country; payroll collection only works inside the UK.
Thresholds per the 2026/27 DfE and SLC announcements, as used by our tested calculator engine. Last updated 2026-11-04.