Janice Lozano
In the UK, you only have to start repaying your student loan when your income is over the threshold amount for your repayment plan, unless you've been overpaid. The threshold amount changes on 6 April every year. If you are employed, your repayments will be taken from your wages, and you will see them on your wage slip. If you are self-employed, your student loan repayments will be done through your Self Assessment tax return. If you move overseas, you will need to repay your student loan directly to the Student Loans Company (SLC). There is no penalty for paying off your student loan early, but there may be early redemption penalties for clearing debts early.
| Characteristics | Values |
|---|---|
| When to start repaying | The April after you finish or leave your course, but only if you're earning over the repayment threshold. |
| Repayment threshold | £403 a week, £1,750 a month or £21,000 a year for Master's or Doctoral Loans; £32,745 annual salary for loans taken out on or after 1 September 1998 |
| Repayment methods | Through your employer (PAYE), self-assessment tax return, or directly to the Student Loans Company (SLC) if you move overseas |
| Repayment plans | Plan 1, Plan 4, Plan 5 |
| Loan cancellation | After 30 years or when you turn 65, depending on the academic year in which the loan was taken out; if you become permanently unfit for work due to a disability |
| Overpayments | No refunds are given for extra repayments; you must repay any overpayments |
| Early repayment penalties | None; there may even be an advantage to paying early due to the interest rate being based on the Retail Price Index (RPI) |
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Repayment thresholds
For Plan 1 loans, the repayment threshold will rise to £26,900 from 6 April 2026 to 5 April 2027. The repayment threshold for undergraduate Plan 1 loans for the 2024-2025 period is £26,065. If you are on Plan 1 and have an income of £33,000 a year, or £2,750 per month, you will be making repayments.
For Plan 2 loans, the repayment threshold for undergraduate loans for the 2024-2025 period is £28,470. The income threshold for Plan 2 loans from 6 April 2022 to 5 April 2023 is £2,372 per month, or £28,470 per year. If you are on Plan 2 and are paid £2,400 per month from one job and £500 per month from another, you will only make repayments on the income from the first job as it is above the threshold. If your income is over the Plan 2 threshold but under the Plan 1 threshold, you will still only repay 9% of your income over the Plan 1 threshold.
For Plan 5 loans, the income threshold for repayment due to come into effect from April 2026 is £25,000.
For Postgraduate Masters and Doctoral Loans, the repayment threshold is £403 per week, £1,750 per month, or £21,000 per year.
If you are self-employed, your student loan repayments will be done through your Self Assessment tax return. If you are employed, your repayments will be taken from your wages, which you will see on your wage slip.
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Repayment plans
The repayment plan you are on depends on when you started your course and what type of course you studied. You can check which repayment plan you are on by signing in to your online account.
Plan 1
If you are on Plan 1, this means you studied an undergraduate or postgraduate course. You will repay 9% of your income over the threshold of £2,172 a month or £26,400 a year.
Plan 2
If you are on Plan 2, this means you studied an undergraduate or postgraduate course. You will repay 9% of your income over the threshold of £2,372 a month or £28,470 a year.
Plan 4
If you are on Plan 4, this means you are a Scottish student who started an undergraduate or postgraduate course anywhere in the UK on or after 1 September 1998. The threshold for Plan 4 is an annual salary of £32,745.
Postgraduate Loans
If you took out a Master's Loan or a Doctoral Loan, you will only repay when your income is over £403 a week, £1,750 a month, or £21,000 a year.
Self-employed
If you are self-employed, your student loan repayments will be done through your Self Assessment tax return. When filling in your Self Assessment tax return, tick the box saying you have a student loan. You will have to budget for student loan payments when you submit your Self Assessment tax return and pay HM Revenue and Customs (HMRC).
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Overpayments
If you have overpaid your student loan, you can get a refund. Overpayments can occur if you start repaying your student loan before earning above a specific annual threshold. The Student Loans Company (SLC) will write to you if you have been overpaid and tell you what you must pay back and how to pay. You must repay overpayments separately from your loan repayments, and you must arrange to repay as soon as possible.
If you have not heard from the SLC and believe you have overpaid, you can ask them for a refund. You can check your loan balance in your online account. You may need to provide payslips, P60s, and Self-Assessment tax forms to track your payments.
To avoid overpaying once you have paid off your loan, the SLC lets you make your last two years of repayments via Direct Debit.
If you are having difficulty with your loan repayments, you can call Student Finance England for advice.
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Moving overseas
If you're moving overseas, you must inform the Student Loans Company (SLC) if you're leaving the UK for more than three months. You will be asked to complete an 'Overseas Income Assessment Form', giving details of your income and employment status. The SLC will then send you a letter outlining the next steps. If you do not update the SLC about your circumstances, you may incur penalties and accrue arrears on your account.
The amount you repay while living abroad will be the same as it would have been in the UK, but converted into the equivalent amount for the country you're living in. The repayment threshold for each country is based on living costs and is updated annually to account for price changes. Therefore, your repayment threshold when living abroad may not be the same as in the UK.
Once your income goes above the Student Loan repayment threshold for the country you are living in, you will be required to make student loan repayments. You will pay a percentage of your total earnings over this threshold. For example, if you're on Plan 4 in Brazil, you would pay 9% of everything you earn over £19,660 (or the equivalent in Brazilian real). The interest rate on your loan doesn't change when you move abroad, so it will remain the same as in the UK.
If you have been abroad and then return to the UK for three months or more, you should inform the SLC, as your repayment status will change. You may need to make repayments through Pay As You Earn (PAYE), and you will need to cancel any separate arrangements you made directly with the SLC. It is important to understand whether you have made overpayments on your loan to avoid this.
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Early repayment
If you have taken out a Master's Loan or a Doctoral Loan, you only need to start repaying it when your income is over £403 a week, £1,750 a month, or £21,000 a year. There is no penalty for paying off some or all of your loan early. You can make extra repayments in your online account and by card, bank transfer, or cheque.
If you have taken out a student loan between 1990 and 1 September 1998, you may choose to make voluntary repayments, but you are not obliged to. If you took out your student loan on or after 1 September 1998, repayments will be automatically deducted from your wages if your annual salary is over the current threshold of £32,745.
If you are self-employed, your student loan repayments will be done through your Self Assessment tax return. When filling in your Self Assessment tax return, tick the box saying you have a student loan. You will need to budget for student loan payments when you submit your Self Assessment tax return and pay HM Revenue and Customs (HMRC).
If you are planning to leave the UK for more than three months, you must inform the Student Loans Company (SLC). You will be expected to keep repaying your loan unless you can provide proof that your overseas income is below the threshold. If you do not inform the SLC, you may build up debt ('accrue arrears') on your account, which you will need to pay back on top of your regular repayments.
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Frequently asked questions
If you're a full-time student, you'll be due to start repaying your loan the April after you finish or leave your course, but only if you're earning over the repayment threshold. For part-time courses, you'll normally be due to start repaying the April four years after the start of your course, or the April after you finish or leave your course, whichever comes first, but only if you're earning over the repayment threshold.
The threshold for starting to repay your student loan is currently £32,745 per year. This threshold changes on 6 April every year. If you took out a Master's Loan or a Doctoral Loan, you'll only repay when your income is over £403 a week, £1,750 a month or £21,000 a year.
If you're employed, repayments will be taken from your wages. You'll see the repayments on your wage slip. If you're self-employed, your student loan repayments will be done through your Self Assessment tax return. If you move overseas, you'll repay directly to the Student Loans Company, usually by direct debit.
Yes, you can pay your loan off whenever you want, and there's no penalty for paying it off early. However, with some loans, there may be early redemption penalties for clearing debts early. You can make extra repayments in your online account and by card, bank transfer or cheque.
