How do UK student loan repayments work?
UK student loan repayments are generally income-contingent. This means the amount you repay depends on your earnings above the repayment threshold for your particular loan plan, rather than simply on the outstanding loan balance.
If your earnings are below the relevant threshold, you will normally not make a repayment through payroll for that period. Once earnings exceed the threshold, the repayment percentage applies only to the earnings above it.
Most undergraduate repayment plans use a 9% rate. Postgraduate Loans use a 6% rate. The threshold differs according to the repayment plan.
UK student loan repayment thresholds for 2026/27
The following values are the 2026/27 thresholds provided in the original calculator page. Verify them against current HMRC guidance before using them for payroll or financial decisions.
Applies to earnings above the relevant Plan 1, 2, 4 or 5 threshold.
Applies to earnings above the applicable postgraduate threshold.
Deductions depend on earnings above your plan threshold.
| Repayment plan | Annual threshold | Repayment rate |
|---|---|---|
| Plan 1 | £26,900 | 9% |
| Plan 2 | £29,385 | 9% |
| Plan 4 | £33,795 | 9% |
| Plan 5 | £25,000 | 9% |
| Postgraduate Loan (PGL) | £21,000 | 6% |
Plan 3 is not used as a standard repayment-plan label in this calculator. The correct plan depends on factors such as where and when you studied.
Student loan repayment calculation formula
To estimate your annual repayment, subtract your plan's annual threshold from annual earnings. If the result is positive, multiply it by the applicable repayment percentage.
Earnings above threshold = max(Annual earnings − Repayment threshold, 0)
Estimated annual repayment = Earnings above threshold × Repayment rate ÷ 100
Illustrative monthly average = Estimated annual repayment ÷ 12
The monthly figure is an annual average, not a precise payslip prediction. Employers normally calculate deductions separately for each pay period.
UK student loan repayment worked examples
Example 1: Plan 2, £40,000 annual salary
- Annual earnings: £40,000
- Plan 2 threshold: £29,385
- Earnings above threshold: £10,615
- Repayment rate: 9%
- Annual repayment: £10,615 × 9% = £955.35
Estimated annual repayment: £955.35
Illustrative monthly average: approximately £79.61.
Example 2: Plan 1, £35,000 annual salary
- Annual earnings: £35,000
- Plan 1 threshold: £26,900
- Earnings above threshold: £8,100
- Repayment rate: 9%
Estimated annual repayment: £729.00
Illustrative monthly average: £60.75.
Example 3: Plan 4, £40,000 annual salary
- Annual earnings: £40,000
- Plan 4 threshold: £33,795
- Earnings above threshold: £6,205
- Repayment rate: 9%
Estimated annual repayment: £558.45
Illustrative monthly average: approximately £46.54.
Example 4: Plan 5, £30,000 annual salary
- Annual earnings: £30,000
- Plan 5 threshold: £25,000
- Earnings above threshold: £5,000
- Repayment rate: 9%
Estimated annual repayment: £450.00
Illustrative monthly average: £37.50.
Example 5: Postgraduate Loan, £40,000 annual salary
- Annual earnings: £40,000
- Postgraduate threshold: £21,000
- Earnings above threshold: £19,000
- Repayment rate: 6%
Estimated annual repayment: £1,140.00
Illustrative monthly average: £95.00.
What happens if your salary is below the threshold?
If your earnings in a relevant pay period are below the applicable repayment threshold, a student loan deduction will normally not be due for that period.
For example, using the threshold stated above, someone earning £25,000 annually under Plan 2 would have an annualised repayment estimate of £0 because their earnings are below £29,385.
Interest may still accrue on an outstanding loan balance even during periods when no repayment is required.
Can you repay more than one student loan?
Some borrowers have both an undergraduate student loan and a Postgraduate Loan. In those circumstances, payroll deductions for the two categories can apply at the same time.
For example, a borrower with a Plan 2 loan and a Postgraduate Loan may have a 9% deduction above the Plan 2 threshold and a separate 6% deduction above the postgraduate threshold.
Why can payslip deductions differ from this estimate?
Employers generally calculate student loan deductions using earnings and repayment thresholds for the actual payroll period. This can produce a different result from an annualised estimate.
For example, overtime, bonuses, commission or irregular monthly earnings can cause a deduction in one month even if your annual earnings appear lower than the annual threshold.
Payroll rounding, pay frequency, the type of earnings subject to deductions and the repayment plan recorded by your employer may also affect the result.
Are student loan repayments the same as Income Tax?
No. Student loan repayments, Income Tax and National Insurance are separate payroll deductions. Each follows its own calculation rules and thresholds.
Student loan repayments are generally calculated using earnings relevant to the student loan rules, rather than simply using take-home pay after Income Tax.
To estimate other deductions, use the UK salary and National Insurance calculators linked below.
How do you know which repayment plan you are on?
Your repayment plan is determined by your student finance arrangements, including factors such as your course, when you started studying and the student finance system that funded you.
You can check your plan through your Student Loans Company account, correspondence or the official GOV.UK guidance. Do not select a plan based only on which threshold gives the lowest repayment.
Does this calculator estimate loan interest or repayment time?
No. This calculator estimates an income-based annual repayment amount. It does not calculate your outstanding loan balance, interest accrual, write-off date or the time required to repay the full loan.
Those outcomes depend on additional factors, including the loan balance, applicable interest rate, future earnings, repayment-plan rules and any voluntary repayments.
How to use the Student Loan Repayment Calculator
- Enter your gross annual earnings in pounds.
- Identify your student loan repayment plan.
- Enter the applicable annual repayment threshold.
- Enter 9% for an undergraduate plan or 6% for a Postgraduate Loan, as applicable.
- Select Calculate to view your annualised estimate.
- Compare the estimate with official guidance and your actual payroll deductions.
Official UK student loan repayment guidance
For the latest repayment thresholds, plan identification, payroll rules and student loan account information, consult the following official resources.
- GOV.UK – Repaying your student loan
- GOV.UK – What you repay
- GOV.UK – Which repayment plan you are on
- GOV.UK – Manage your student loan balance
Frequently asked questions
How much student loan do I repay in 2026/27?
Your repayment depends on your earnings, repayment plan and applicable threshold. Most undergraduate plans deduct 9% of earnings above the threshold, while Postgraduate Loans use 6%.
What is the Plan 2 repayment threshold for 2026/27?
The original page supplies £29,385 as the annual Plan 2 threshold for 2026/27. Check the current official GOV.UK rate before relying on the calculation.
Do I repay 9% of my entire salary?
No. For the standard undergraduate repayment calculation, 9% applies only to earnings above the relevant threshold.
What is the Postgraduate Loan repayment rate?
The standard Postgraduate Loan repayment rate is 6% of earnings above the applicable postgraduate threshold.
Do student loan repayments stop if I earn less?
If earnings fall below the applicable threshold for a pay period, a payroll deduction will normally not be required for that period.
Can I repay Plan 2 and a Postgraduate Loan together?
Yes. Where both types apply, separate undergraduate and postgraduate deductions may be taken. This calculator estimates one calculation at a time.
Why is my monthly repayment different?
Payroll calculations use pay-period earnings and thresholds, with applicable rounding rules. An annualised estimate divided by twelve may therefore differ from an actual payslip.
Does this calculator include student loan interest?
No. It estimates income-based repayments, not loan interest, outstanding balance or repayment duration.
Is this an official HMRC or Student Loans Company calculator?
No. CalculatorsOnline is an independent website and is not affiliated with HMRC, the Student Loans Company or the UK Government.
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Important: This calculator provides an annualised planning estimate based on the threshold and repayment percentage entered. It does not reproduce every payroll deduction rule, determine your repayment plan, calculate interest, or account for your outstanding loan balance. The supplied 2026/27 thresholds have not been independently verified against live HMRC guidance.
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