Student Loan Repayments UK: Complete Guide 2025
Student Loan Repayments UK: Complete Guide 2025
Understanding how student loan repayments work is crucial for financial planning. This guide covers all UK student loan plans and repayment thresholds for 2025.
Student Loan Plans Overview
There are four main types of student loans in the UK:
- Plan 1 - Pre-2012 English/Welsh students or Northern Ireland students
- Plan 2 - Post-2012 English/Welsh students
- Plan 4 - Scottish students (from April 2021)
- Postgraduate Loan - Master's and PhD students
Repayment Thresholds 2025/26
| Plan | Annual Threshold | Monthly Threshold | Weekly Threshold |
|---|---|---|---|
| Plan 1 | £24,990 | £2,082.50 | £480.58 |
| Plan 2 | £27,295 | £2,274.58 | £524.90 |
| Plan 4 | £31,395 | £2,616.25 | £603.75 |
| Postgraduate | £21,000 | £1,750 | £403.85 |
How Repayments Work
Repayment Rate
- Plan 1, 2, and 4: 9% of income above the threshold
- Postgraduate Loan: 6% of income above the threshold
- Repayments are deducted automatically from your salary via PAYE
Example Calculations
Plan 2 Loan (£30,000 Salary)
- Income above threshold: £30,000 - £27,295 = £2,705
- Annual repayment: £2,705 × 9% = £243.45
- Monthly deduction: £20.29
Plan 1 Loan (£35,000 Salary)
- Income above threshold: £35,000 - £24,990 = £10,010
- Annual repayment: £10,010 × 9% = £900.90
- Monthly deduction: £75.08
Postgraduate Loan (£40,000 Salary)
- Income above threshold: £40,000 - £21,000 = £19,000
- Annual repayment: £19,000 × 6% = £1,140
- Monthly deduction: £95
Multiple Loans
If you have multiple loans, you repay:
- 9% on the highest threshold amount (for undergraduate loans)
- Plus 6% on postgraduate loan threshold amount
Example: Plan 2 + Postgraduate (£40,000 Salary)
- Plan 2: (£40,000 - £27,295) × 9% = £1,143.45/year
- Postgraduate: (£40,000 - £21,000) × 6% = £1,140/year
- Total annual repayment: £2,283.45
- Monthly deduction: £190.29
When Repayments Stop
Your student loan is written off after:
- Plan 1: 25 years from the April after you graduate (or when you turn 65)
- Plan 2: 30 years from the April after you graduate
- Plan 4: 30 years from the April after you graduate
- Postgraduate: 30 years from the April after you graduate
Self-Employed Repayments
If you're self-employed:
- Repayments are calculated through Self Assessment
- You'll pay based on your annual income
- Payments are due by 31 January following the tax year
Overseas Repayments
If you move abroad:
- You must notify the Student Loans Company
- Repayments continue based on local income
- Thresholds are converted to local currency
- Interest rates may differ
Interest Rates 2025/26
| Plan | Interest Rate |
|---|---|
| Plan 1 | RPI (Retail Price Index) |
| Plan 2 | RPI + up to 3% (based on income) |
| Plan 4 | RPI |
| Postgraduate | RPI + 3% |
Impact on Take-Home Pay
Student loan repayments significantly affect your take-home salary:
£30,000 Salary Example
- Income Tax: £3,486
- National Insurance: £1,474
- Plan 2 Student Loan: £243
- Total deductions: £5,203
- Take-home: £24,797
£50,000 Salary Example
- Income Tax: £7,486
- National Insurance: £3,014
- Plan 2 Student Loan: £2,043
- Total deductions: £12,543
- Take-home: £37,457
Should You Pay Off Early?
Considerations:
- Interest rates - Compare to other debts
- Write-off date - May be written off before full repayment
- Other financial priorities - Emergency fund, pension, mortgage
- Career trajectory - Higher future earnings may justify early repayment
Using Our Calculator
Our UK Salary Calculator automatically calculates student loan repayments. Simply select your loan plan(s) to see accurate take-home pay.
Getting Help
- Check your balance: Student Loans Company
- Update your details: Student Loans Company portal
- Calculate repayments: Use our salary calculator
- Contact: Student Loans Company helpline
Note: Student loan thresholds and rates are reviewed annually. Always check the latest information from the Student Loans Company for the most current rates.