Paying off your student loan: how much you are repaying


The amount you reimburse depends on your plan.

Each plan has a threshold for your weekly or monthly income. You reimburse:

  • 9% of the amount you earn above the threshold for plans 1, 2 and 4
  • 6% of the amount you earn beyond the postdoctoral loan threshold

You do not reimburse anything if your income is below the threshold.

Interest begins to be added to your loan from the moment you receive your first payment.

Plan 1

The thresholds are £ 382 per week or £ 1,657 per month (before taxes and other deductions).

Example

You get paid monthly and your income changes every month. This month your income was £ 2,000, which is above the Plan 1 monthly threshold of £ 1,657.

Your income was £ 343 above the cut-off (£ 2,000 minus £ 1,657). You will repay £ 31 (9% of £ 343) this month.

Example

Your annual income is £ 27,000 and you receive a regular monthly salary. This means that each month your income is £ 2,250 (£ 27,000 divided by 12). That’s above the Plan 1 monthly threshold of £ 1,657.

Your income exceeds the threshold of £ 593 (£ 2,250 less £ 1,657). You will repay £ 53 (9% of £ 593) each month.

Interest on plan 1

You are currently paying 1.1% interest on Plan 1. You can find out how interest is calculated and the interest rates for previous years.

Plan 2

The thresholds are £ 524 per week or £ 2,274 per month (before taxes and other deductions). They change on April 6 of each year.

Example

You get paid weekly and your income changes weekly. This week your income was £ 600 which is above the weekly Plan 2 threshold of £ 524.

Your income was above the threshold of £ 76 (£ 600 minus £ 524). You will reimburse £ 6 (9% of £ 76) this week.

Example

Your annual income is £ 28,800 and you receive a regular monthly salary. This means that each month your income is £ 2,400 (£ 28,800 divided by 12). That’s above Plan 2’s monthly threshold of £ 2,274.

Your income exceeds the threshold of £ 126 (£ 2,400 minus £ 2,274). You will repay £ 11 (9% of £ 126) each month.

Interest on plan 2

While you are studying, the interest is 4.4%.

This is the retail price index (RPI) plus up to 3%.

This rate applies until April 5 following the end or exit of your course, or during the first 4 years of your course if you are studying part-time, unless the RPI changes.

After that, your interest rate depends on your income in the current tax year.

If you are an employee, your income is your taxable salary:

  • plus pension contributions
  • minus any benefits you receive from your employer that are taxed through payroll (ask your employer if you are unsure)

If you pay tax using a self-assessment tax return, your income is the total amount of income shown on your self-assessment form. You will generally pay tax using a self-assessment tax return if you are self-employed.

If you have more than one job per year, your interest rate will be based on the combined income from all of your jobs.

Your annual income Interest rate
£ 27,295 or less RPI (currently 1.5%)
£ 27,296 to £ 49,130 RPI (currently 1.5%), plus up to 3%
Over £ 49,130 usually RPI (currently 1.5%), plus 3%

You must keep your details in your online account up to date and provide proof to the Student Loans Company (SLC) if they request it. If you don’t, you may have to pay the higher interest rate even if your income is lower.

You can find out how interest is calculated and the interest rates for previous years.

If you have Plan 1 and Plan 2 loans

You pay back 9% of your income above Plan 1 threshold (£ 382 per week or £ 1,657 per month).

If your income is below the Plan 2 threshold (£ 524 per week or £ 2,274 per month), your repayments will only go towards your Plan 1 loan.

If your income exceeds the Plan 2 threshold, your repayments will be returned to your two loans.

Plan 4

The thresholds are £ 480 per week or £ 2,083 per month (before taxes and other deductions).

Example

You get paid monthly and your income changes every month. This month your income was £ 2,250, which is above the Plan 4 monthly threshold of £ 2,083.

Your income was £ 167 above the cut-off (£ 2,250 minus £ 2,083). You will repay £ 15 (9% of £ 167) this month.

Example

Your annual income is £ 33,000 and you receive a regular monthly salary. This means that each month your income is £ 2,750 (£ 33,000 divided by 12). That’s above Plan 4’s monthly threshold of £ 2,083.

Your income exceeds the threshold of £ 667 (£ 2,750 minus £ 2,083). You will repay £ 60 (9% of £ 667) each month.

Interest on plan 4

You are currently paying 1.1% interest on Plan 4. You can find out how interest is calculated and the interest rates for previous years.

If you have a Plan 4 loan and a Plan 1 loan

You pay back 9% of your income above Plan 1 threshold (£ 382 per week or £ 1,657 per month).

If your income is below the Plan 4 threshold (£ 480 per week or £ 2,083 per month), your repayments will only go towards your Plan 1 loan.

If your income exceeds the Plan 4 threshold, your repayments will be returned to your two loans.

Example

You have a Plan 4 loan and a Plan 1 loan.

Your annual income is £ 28,800 and you receive a regular monthly salary. This means that each month your income is £ 2,400 (£ 28,800 divided by 12). This exceeds the monthly Plan 4 threshold of £ 2,083 and the Plan threshold of £ 1,657.

Your income is £ 743 above the Plan 1 cutoff (£ 2,400 minus £ 1,657), which is the lower of the two plans.

You will refund £ 67 (9% of £ 743) and refunds will go to both plans.

If you have a Plan 4 loan and a Plan 2 loan

You pay back 9% of your income above Plan 4 threshold (£ 480 per week or £ 2,083 per month).

If your income is below the Plan 2 threshold (£ 524 per week or £ 2,274 per month), your repayments will only go towards your Plan 4 loan.

If your income exceeds the Plan 2 threshold, your repayments will be returned to your two loans.

Example

You have a Plan 4 loan and a Plan 2 loan.

Your annual income is £ 28,800 and you receive a regular monthly salary. This means that each month your income is £ 2,400 (£ 28,800 divided by 12). This exceeds the monthly Plan 4 threshold of £ 2,083 and the Plan 2 threshold of £ 2,274.

Your income is £ 317 above the Plan 4 cutoff (£ 2,400 minus £ 2,083), which is the lower of the two plans.

You will refund £ 28 (9% of £ 317) and refunds will go to both plans.

Postgraduate loan

The thresholds are £ 403 per week or £ 1,750 per month (before taxes and other deductions).

Example

You get paid weekly and your income changes weekly. This week your income was £ 600 which is above the weekly postgraduate loan threshold of £ 403.

Your income was £ 197 above the cut-off (£ 600 minus £ 403). You will reimburse £ 11 (6% of £ 197) this week.

Example

Your annual income is £ 28,800 and you receive a regular monthly salary. This means that each month your income is £ 2,400 (£ 28,800 divided by 12). This exceeds the monthly postdoctoral loan threshold of £ 1,750.

Your income exceeds the threshold of £ 650 (£ 2,400 minus £ 1,750). You will repay £ 39 (6% of £ 650) each month.

Interest on graduate student loan

You are currently paying 4.4% interest on graduate student loans.

Interest is usually the retail price index (RPI) plus 3%.

You can find out how interest is calculated and the interest rates for previous years.

If you have a postdoctoral loan and a Plan 1, Plan 2 or Plan 4 loan

You repay 6% of your income above the postdoctoral loan threshold (£ 403 per week or £ 1,750 per month). In addition, you will repay 9% of your income above the Plan 1, Plan 2 or Plan 4 threshold.

Example

You have a postdoctoral loan and a Plan 2 loan.

Your annual income is £ 28,800 and you receive a regular monthly salary. This means that each month your income is £ 2,400 (£ 28,800 divided by 12). This exceeds the monthly postdoctoral loan threshold of £ 1,750 and the Plan 2 threshold of £ 2,274.

Your income is £ 650 above the postgraduate loan threshold (£ 2,400 minus £ 1,750) and £ 126 above the plan 2 threshold (£ 2,400 minus £ 2,274).

You will pay back £ 39 (6% of £ 650) on your postgraduate loan and £ 11 (9% of £ 126) on your Plan 2 loan. So your total monthly repayment will be £ 50.

Example

You have a postdoctoral loan and a Plan 1 loan.

Your annual income is £ 28,800 and you receive a regular monthly salary. This means that each month your income is £ 2,400 (£ 28,800 divided by 12). This exceeds the monthly postdoctoral loan threshold of £ 1,750 and the Plan 1 threshold of £ 1,657.

Your income is £ 650 above the postgraduate loan cut-off (£ 2,400 minus £ 1,750) and £ 743 above Plan 1 cut-off (£ 2,400 minus £ 1,657).

You will pay back £ 39 (6% of £ 650) on your postgraduate loan and £ 66 (9% of £ 743) on your Plan 1 loan. So your total monthly repayment will be £ 105.

If your income changes during the year

You can request a refund if you make refunds but your total annual income (from April 6 to April 5 of the following year) is less than:

  • £ 19,895 per year for plan 1
  • £ 27,295 per year for plan 2
  • £ 25,000 per year for plan 4
  • £ 21,000 for postgraduate loans

If you have 2 or more jobs

If you are an employee, your reimbursements will be deducted from your salary. Reimbursements will come from jobs for which you earn more than the minimum amount, not your combined earnings.

Example

You have a Plan 1 loan.

You have 2 jobs, both of which pay you a regular monthly salary. Before taxes and other deductions, you earn £ 1,000 per month for one job and £ 800 per month for the other.

You will not have to make a repayment as neither salary exceeds the threshold of £ 1,657 per month.

Example

You have a Plan 2 loan.

You have 2 jobs, both of which pay you a regular monthly salary. Before taxes and other deductions, you earn £ 2,300 per month for one job and £ 500 per month for the other.

You will only reimburse work income that earns you £ 2,300 per month as it exceeds the £ 2,274 threshold.

If you need to send a self-assessment tax return

HM Revenue and Customs (HMRC) will determine the amount you reimburse from your tax return. Your repayments are based on your income for the entire year. If you have already made repayments from a salary, HMRC will deduct them from the amount you have to repay.

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