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Student Loan Repayment Calculator

Project your monthly deductions, total interest paid, and whether your loan will be written off. Works for Plan 1, Plan 2, Plan 4, Plan 5 and Postgraduate loans. Updated for 2026/27 tax year.

By UK Tax Drag · Reviewed 26 September 2026

Plans 1, 2, 4, 5 and PG — monthly deductions and lifetime cost.

UK student loans are repaid through PAYE: 9% of income above your plan’s threshold (Plan 1 £26,900, Plan 2 £29,385, Plan 4 £33,795, Plan 5 £25,000) for the undergraduate plans, plus 6% above £21,000 for Postgraduate Loans.

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More about this calculator

Many people have an undergraduate plan AND a PGL — both deduct simultaneously.

A common question is whether overpaying is worthwhile. The answer depends on your plan, balance, interest rate and expected earnings, because any balance left at the write-off point is cancelled (25 years after the April you were first due to repay for most Plan 1 loans, 30 years for Plan 2 and Postgraduate Loans, 40 years for Plan 5). This calculator shows how your own figures play out.

Educational only. Real salary growth, career breaks and plan changes will alter outcomes. Repayment thresholds and interest rates are frozen or growing with inflation — check gov.uk/repaying-your-student-loan for the latest. Not financial advice.

Is a UK student loan really a loan?

A UK student loan is not a traditional loan. It is a 9% graduate tax on earnings above the repayment threshold. You only pay when you earn above the threshold. It does not appear on your credit file. It stops when your salary falls below the threshold, even if you still owe money. After 30 or 40 years (depending on the plan), whatever remains is written off — which means for many borrowers, the amount written off is much larger than what they repaid. Understanding this changes the calculation entirely.

Your student loan scenario

Plan type

Have both an undergraduate plan AND a Postgraduate Loan? Run two scenarios in this projector (one per plan) and add the monthly deductions. Or use the main tax calculator — it now supports both loans simultaneously and shows the combined monthly deduction in the breakdown.

Current balance (£)

£0£150k

Gross annual salary (£)

£15k£200k

Annual salary growth (%)

0%8%

Interest rate on loan (%)
Plan default: the rate from 1 September 2026 (Plan 2: the 6% maximum)

0%12%

Years since you started repaying

040

Monthly voluntary overpayment (£)

£0£1,000

Your lifetime repayment

£0

You'll clear this in X years (or it'll be written off)

Monthly deduction now

£0

Total interest paid

£0

£0Monthly deduction now

0Years to clear (if salary maintained)

£0Total interest paid

£0Total amount repaid

£0Amount written off (if any)

Likely outcomeWaiting for a repayment outlook.

Plan thresholdWaiting for threshold detail.

Overpayment stanceWaiting for the overpayment read.

What this means

The professional question is not whether the balance looks large. It is whether you are on a path to clear the plan before write-off, because that decides whether overpaying is rational or just an avoidable transfer to the Treasury.

Professional read

How to read the student-loan result properly

The right question is not "How bad does the balance look?" It is whether the plan behaves like a real debt you will clear or a payroll-linked graduate tax you are unlikely to finish repaying.

Key assumptionsThe projection assumes the salary path, inflation-linked thresholds, and plan rules entered today continue without a major policy rewrite.

Common mistakeOverpaying because the balance feels emotionally large, even when the projection says the plan is unlikely to be cleared before write-off.

What this changesIf the plan is not likely to be cleared, an overpayment mainly reduces the amount written off; the same money could go to other uses, such as a pension, an ISA or paying down more expensive debt, each with its own trade-offs.

When this breaks downVery uneven career paths, long breaks from earnings, expatriate periods, or future government rule changes can alter the repayment story materially.

Professional note. For many borrowers, the best use of this tool is not finding the exact balance path. It is deciding whether overpayment should even be in the conversation.

Balance and cumulative repayment over time

Outstanding loan balance Cumulative repayments

Year-by-year breakdown

This table shows your projected balance, salary and repayments for each year of the loan.

Year	Age	Salary	Annual repayment	Interest accrued	Balance

The five UK student loan plans

Each plan has different thresholds, interest rates and write-off periods. Most borrowers are on Plan 2 or Plan 5. These figures are correct for the 2026/27 tax year.

Plan	Repayment threshold	Repayment rate	Interest rate (typical)	Write-off period
Plan 1	£26,900	9%	Lower of RPI or base + 1% (4.1% from Sept 2026)	25 years
Plan 2	£29,385	9%	RPI to RPI+3% by income, capped at 6%: 4.1% to 6% from Sept 2026	30 years
Plan 4 (Scottish)	£33,795	9%	Lower of RPI or base + 1% (4.1% from Sept 2026)	30 years
Plan 5 (from Aug 2023)	£25,000 (frozen to 2027)	9%	RPI only (4.1% from Sept 2026)	40 years
Postgraduate	£21,000	6%	RPI+3%, capped at 6%: 6% from Sept 2026	30 years

When does repayment start?

Repayment begins on the April after you finish your course (or, for a part-time course longer than 4 years, the April 4 years after it started), regardless of whether you have a job. If you earn below the threshold, you pay nothing, but the months still count towards the 25/30/40-year write-off clock.

How do student loan interest rates work?

Interest rates vary by plan. They are usually reset on 1 September each year, based on RPI (Retail Price Index) inflation for the previous March, and can also change during the year. Plan 1 and Plan 4 charge the lower of RPI and Bank of England base rate + 1%: 4.1% from 1 September 2026. Plan 2 charges RPI (4.1%) while income is £29,385 or less, rising with income to RPI+3% from £52,885; the Postgraduate Loan charges RPI+3%. Both are capped at 6% from 1 September 2026, below the 7.1% that RPI+3% would give. Plan 5 uses RPI only (4.1%), making it significantly cheaper over time if inflation stays low. Interest accrues daily and is charged monthly, compounded into your balance. The interest box in the calculator starts at each plan’s current rate, and at the 6% maximum for Plan 2.

The single most important insight

Whether an overpayment saves money depends on whether the loan would otherwise be repaid in full. If it would be written off with money still owed, an overpayment only reduces the amount written off; if it would be cleared anyway, an overpayment saves interest. The Department for Education expects about 55% of recent Plan 5 borrowers and 32% of the last Plan 2 cohort to repay in full. Money used to overpay is not available for other uses, such as an ISA or a pension, which have their own tax treatment and risks.

Should you overpay your student loan?

Overpayment decisions depend entirely on your personal circumstances:

Likely to be written off: an overpayment only reduces the balance that would later be written off, unless it is large enough to clear the loan before then.
Likely to be cleared: if you earn well above the threshold and would clear the loan before write-off, an overpayment saves interest at the plan's rate.
Other uses of the same money: pension contributions get tax relief at your marginal rate (20%, 40% or 45%) and ISA growth is tax-free, but both carry investment risk and pension money is locked until minimum pension age.

Salary sacrifice into pension reduces your student loan bill

Pension contributions via salary sacrifice reduce your gross pay for the student loan repayment calculation. If you earn £40,000 and contribute £5,000 into a workplace pension via salary sacrifice, your loan repayment is calculated on £35,000 gross. That saves £1,000 of income tax (20%) and £400 of employee NI (8%), and cuts the loan repayment by £450 a year (9% of £5,000), so the pension receives £5,000 for £3,150 of take-home pay. The trade-offs: the money is locked until minimum pension age, it is taxed when drawn beyond the tax-free part, and a lower salary can affect mortgage affordability and some statutory payments.

Tip: Check if your employer matches

Many employers match workplace pension contributions up to 3-6% of pay, which adds employer money to your pension on top of your own. If you pay in through salary sacrifice, your pay for student loan purposes falls too, so your repayments fall; a net pay arrangement does not have that effect.

Moving abroad and student loans

Student loan repayment does not stop when you leave the UK. You stay liable until the loan is repaid or written off, and write-off does not apply while you are in breach of a repayment obligation. If you leave the UK for more than 3 months you must tell the Student Loans Company (SLC). SLC, not HMRC, decides whether repayments continue through a UK employer's payroll or are paid to SLC directly; direct repayments are set from your income using a threshold for the country you live in. Without income details SLC can charge a fixed monthly amount, and missed repayments build up as arrears. Failure to repay can lead to enforcement action and sanctions. Speak to the Student Loans Company before moving permanently.

Important: Overseas assessment is complex

Working abroad does not write off your student loan or stop interest accrual. You must stay registered with the Student Loans Company and declare your overseas income. Non-payment can lead to arrears, penalties, a higher interest rate, debt collection and court action to recover the debt. Take legal advice if you plan to work overseas long-term.

PAYE vs self-employed repayment

PAYE employees: Repayment is deducted automatically from your payslip each month (via PAYE coding). You see it come out and do not need to do anything extra.

Self-employed: Repayment is assessed via your Self-Assessment tax return each year. You must declare your profits, and the loan repayment is calculated by HMRC. Payment is due by the tax deadline (31 January). Student loan repayments are not part of payments on account (the advance payments towards next year's tax): GOV.UK says they are paid in the balancing payment by 31 January (GOV.UK, payments on account).

Income tax calculator — net pay and tax code · Salary sacrifice calculator — pension contributions and tax relief · Pension calculator — retirement projection · Compound interest calculator — ISA and investment growth.

Official references & background reading

gov.uk — Repaying your student loan gov.uk — Student Loans Company, the official loan servicer MoneySavingExpert — Student loan repayment: should I pay back early? House of Commons Library — Student finance briefing

▸ How we calculate this — Student loan repayment under Plans 1/2/4/5 + Postgrad

Method — 2026/27 tax year

Plan thresholds + rates (2026/27):

Plan 1: threshold £26,900/yr, rate 9% above
Plan 2: threshold £29,385/yr, rate 9% above
Plan 4 (Scotland): threshold £33,795/yr, rate 9% above
Plan 5 (post-Aug-2023 starters, England): threshold £25,000/yr, rate 9% above
Postgraduate: threshold £21,000/yr, rate 6% above (in addition to any undergrad plan)

Formula: Repayment = (gross earnings − threshold) × rate. For Plan 2 + Postgrad combined, repayment = (earnings − 29,385) × 9% + (earnings − 21,000) × 6%.

Write-off horizons: Plan 1 is written off 25 years after the April you were first due to repay (or at age 65 if your first loan was paid before 1 September 2006); Plan 2, Postgraduate Loans and Plan 4 loans first paid on or after 1 August 2007 are written off 30 years after that April; Plan 5 after 40 years. Loans are also cancelled on death, or if you become permanently unable to work because of illness or disability and get a relevant disability benefit.

Data sources

gov.uk — Repaying your student loan

Reviewed against 2026/27 thresholds. We update when HMRC publishes rate changes — tracked in the changelog. Found an error? See corrections policy.

About this calculator

Last reviewed: September 2026. Reviewed by the Editor against current official guidance for 2026/27.

Verified against: gov.uk — Repaying your student loan (checked on the last review date above).

Source: calculator JavaScript is unminified at /assets/ — see Open methodology for how to verify the math. Updates tracked in the changelog.

Spotted an error? Report it. Confirmed errors are corrected under the corrections policy.

Disclaimer: This tool gives a guideline estimate using current published UK rates and thresholds. It is general information, not personal financial, tax, or legal advice. Verify the figures against your own circumstances, the latest gov.uk guidance, and a qualified adviser before acting. UK Tax Drag accepts no liability for decisions made on the basis of these calculations.

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