Student loan repayments 2026/27
Student loan repayments come out of your pay alongside income tax and National Insurance — 9% of everything above your plan's threshold (6% for the Postgraduate loan), so they reduce take-home pay by a fixed slice rather than by a fixed amount. Plans stack: an undergraduate loan plus a Postgraduate loan means both are deducted.
2026/27 thresholds and rates
| Plan | Annual threshold | Rate | Monthly threshold |
|---|---|---|---|
| Plan 1 | £26,900 | 9% | £2,241.66 |
| Plan 2 | £29,385 | 9% | £2,448.75 |
| Plan 4 | £33,795 | 9% | £2,816.25 |
| Plan 5new from April 2026 | £25,000 | 9% | £2,083.33 |
| Postgraduate | £21,000 | 6% | £1,750.00 |
Thresholds and rates from the GOV.UK rates page for 2026 to 2027.
How repayments are calculated
Each pay period you repay the plan rate — 9%, or 6% for the Postgraduate loan — of your pay above that period's threshold, rounded DOWN to the nearest whole pound. The repayment itself is floored, not the excess above the threshold. HMRC's employer guide pins the calculation with worked examples: for Plan 1 in 2026/27, pay of £700 a week deducts £16 (9% of £182.70 = £16.44, rounded down) and pay of £2,800 a month deducts £50 (9% of £558.34 = £50.25, rounded down) — see Student loan and postgraduate loan repayment guidance for employers.
What plans cost at common salaries
| Gross | Plan 2 | Plan 5 | Postgraduate | Take-home (Plan 5) |
|---|---|---|---|---|
| £25,000 | £0.00 | £0.00 | £240.00 | £21,519.60 |
| £30,000 | £55.00 | £450.00 | £540.00 | £24,669.60 |
| £35,000 | £505.00 | £900.00 | £840.00 | £27,819.60 |
| £40,000 | £955.00 | £1,350.00 | £1,140.00 | £30,969.60 |
Plan 5 repaid 9% above £25,000 from April 2026 — see £30,000 after tax for the full scenario table, or £35,000.