Student Loan Repayments Explained: Plans 1, 2, 4, 5 & Postgrad

Which plan are you on?

Your plan depends on where and when you studied. You only repay through one undergraduate plan, but you can repay a postgraduate loan at the same time.

If you are unsure, your plan type shows on your online student loan account and on your payslip deductions.

• Plan 1: students from England/Wales who started before Sept 2012, and Northern Ireland students.
• Plan 2: England/Wales students who started between Sept 2012 and July 2023.
• Plan 4: Scottish students.
• Plan 5: England students who started courses from September 2023.
• Postgraduate Loan: master's and doctoral loans.

How repayments are calculated

You repay a percentage of income above a threshold, not the whole salary. For undergraduate plans the rate is 9% of income over the threshold; for postgraduate loans it is 6%.

Crucially, repayments are based on income, not the size of the debt. Earn below the threshold and you pay nothing that period; earn more and you pay more — like an extra slice of tax that stops once the loan clears.

Repayment thresholds

Each plan has its own income threshold, and they differ significantly. Plan 1 and Plan 5 have lower thresholds than Plan 2 and Plan 4. Thresholds can change each tax year, so check the current figure for your plan.

If you have both an undergraduate and a postgraduate loan, each is assessed against its own threshold, so deductions can stack.

How you actually pay

If you are employed, repayments are taken automatically through PAYE, alongside tax and National Insurance, and appear on your payslip. The self-employed repay through Self Assessment.

Because it is income-based, a bonus or overtime month can push your deduction up temporarily.

When is the loan written off?

Any remaining balance is cancelled after a set period or at a certain age, depending on your plan — for example, Plan 2 is typically written off 30 years after you first became due to repay, while Plan 5 runs for 40 years.

This is why many graduates never repay the full amount, and why overpaying voluntarily only makes sense for higher earners likely to clear the loan before it is written off.

Should you overpay?

For most people, treating the loan like a graduate tax and not overpaying is sensible — especially if it is likely to be written off before you clear it. High earners who will repay in full may save interest by overpaying.

Use our Student Loan Repayment Calculator to estimate your monthly and annual repayments by plan, and our PAYE Salary Calculator to see it alongside tax and National Insurance.