Student Loan Calculator UK 2026: Plans, Thresholds & Repayments
Student loan calculator UK 2026 tools are what most graduates reach for the moment their first payslip lands and a chunk of their salary has disappeared into repayments they don’t fully understand. If you’re trying to work out how much you’ll actually repay each month, when repayments start, or whether you’re on Plan 1, Plan 2, Plan 4 or Plan 5, you’re not alone: the rules have changed again for 2026/27, and the thresholds are different for almost every plan type.
A student loan calculator UK 2026 works out your monthly repayment by applying a fixed percentage (9% for undergraduate plans, 6% for postgraduate loans) to any income you earn above your plan’s annual threshold, then dividing the result across twelve months, deducted automatically through PAYE alongside tax and National Insurance.
- 2026/27 thresholds: Plan 1 £26,900, Plan 2 £29,385, Plan 4 £33,795, Plan 5 £25,000, Postgraduate £21,000.
- You repay 9% of income above your threshold on Plans 1, 2, 4 and 5, or 6% above the threshold on the Postgraduate Loan.
- Plan 5 repayments start affecting new graduates from April 2026, the first time this plan has kicked in.
- Interest rates are capped at 6% for Plan 2 and Plan 3 (postgraduate) for the 2026/27 academic year; Plan 1 and Plan 5 sit at 3.2%.
- Repayments come out automatically through your payslip if you’re employed, so there’s nothing extra to set up.
- If you have more than one job or irregular income, your annual repayment may differ slightly from the sum of your monthly deductions.
How a student loan calculator UK 2026 actually works
Every student loan calculator UK 2026 tool runs the same basic sum behind the scenes. It takes your gross annual income, subtracts your plan’s repayment threshold, and applies your plan’s repayment rate to whatever is left. If your income sits below the threshold, you repay nothing that year, no matter how large your outstanding balance is.
Repayments are collected automatically by your employer through PAYE, in the same way as income tax and National Insurance. You’ll see the deduction on your payslip labelled “Student Loan”. If you want to understand every line on that payslip, our guide to how to read a UK payslip in 2026 breaks down exactly what each deduction means.
Self-employed workers repay through Self Assessment instead, calculated once a year based on total taxable income rather than monthly PAYE deductions.
2026/27 repayment thresholds by plan
The Student Loans Company and HM Treasury confirm updated thresholds each year, and 2026/27 brings genuine changes rather than a simple inflation uprating. Annual thresholds have risen for Plans 1, 2 and 4, and Plan 5 repayments begin biting for the first time since the plan was introduced for students who started courses from September 2023.
| Plan type | Who it applies to | 2026/27 annual threshold | Repayment rate |
|---|---|---|---|
| Plan 1 | Most students who started courses before September 2012 (England/Wales), or Scottish/NI students | £26,900 | 9% |
| Plan 2 | English/Welsh students who started courses September 2012–July 2023 | £29,385 | 9% |
| Plan 4 | Scottish students (via SAAS) | £33,795 | 9% |
| Plan 5 | English/Welsh students starting courses from September 2023 | £25,000 | 9% |
| Postgraduate Loan | Master’s and Doctoral loan borrowers | £21,000 | 6% |
If you took out a Postgraduate Loan on top of an undergraduate loan, you repay both simultaneously: 9% above your undergraduate threshold and a further 6% above the postgraduate threshold, taken from the same payslip.
Which student loan plan are you on?
Your plan type depends on where you lived when you applied for student finance and when your course started, not on where you studied. Getting this wrong is one of the most common student loan mistakes, because paying off the wrong plan’s projected balance leads to confusing overpayment questions later.
- Plan 1: pre-2012 English/Welsh starters, and most Scottish or Northern Irish students regardless of start date.
- Plan 2: English/Welsh undergraduates who started between September 2012 and July 2023.
- Plan 4: Scottish students who took a loan through the Students Awards Agency for Scotland (SAAS).
- Plan 5: English/Welsh undergraduates starting from September 2023 onward, under the reformed repayment terms.
- Postgraduate Loan: anyone with a Master’s or Doctoral loan, on top of any undergraduate plan.
You can confirm your exact plan type by logging into your account at gov.uk/sign-in-to-manage-your-student-loan-balance, which shows your plan, balance and repayment history in one place.
Worked examples: what you’ll actually repay
Numbers make this far easier to picture than percentages alone. Here’s what three different graduates on different plans and salaries would repay in 2026/27, assuming a single PAYE job and no other deductions affecting taxable income.
Example 1: Plan 2 graduate on £32,000
Income above threshold: £32,000 – £29,385 = £2,615. Annual repayment: 9% of £2,615 = £235.35, or roughly £19.61 a month, deducted automatically through payroll.
Example 2: Plan 5 graduate on £30,000
Income above threshold: £30,000 – £25,000 = £5,000. Annual repayment: 9% of £5,000 = £450, or £37.50 a month. Plan 5’s lower threshold means this graduate repays considerably more than an equivalent Plan 2 earner, despite the lower headline interest rate.
Example 3: Plan 1 graduate on £35,000, using our salary tables
Income above threshold: £35,000 – £26,900 = £8,100. Annual repayment: 9% of £8,100 = £729, or £60.75 a month. If you want to see how this fits alongside tax and National Insurance on this exact salary, our £35,000 after tax UK 2026 guide lays out the full take-home breakdown.
Interest rates for 2026/27
Interest is charged on your outstanding balance from the day you take out each part of your loan, and it compounds even while you’re still studying. For the 2026/27 academic year, the government has capped interest at 6% for Plan 2 and Postgraduate loans, while Plan 1 and Plan 5 sit at a lower 3.2%, broadly in line with RPI.
This cap is described by the Treasury as a temporary protective measure to stop a short-term inflation spike from compounding balances unsustainably. It’s worth checking gov.uk each September, since the rate is reset annually and can move depending on that year’s RPI figure.
Should you overpay your student loan?
For most graduates, the honest answer is no. Student loan repayments behave more like an extra rate of income tax than a conventional debt: unpaid balances are written off after 30 or 40 years depending on your plan, and the majority of graduates never clear the balance before it’s wiped.
Overpaying only makes financial sense if you’re a high earner who’s confident you’ll clear the full balance well before the write-off date, in which case reducing the total interest paid over time can be worthwhile. If you’re unsure, it’s worth comparing the true return against other options like pension contributions or a stocks and shares ISA before committing extra cash.
If you’re building broader financial confidence alongside managing loan repayments, Coffee & Study’s finance and accounting courses cover practical budgeting and personal finance skills that make sense of decisions like this one.
Common mistakes to avoid
Mistake 1: Assuming you’re on the wrong plan based on when you graduated
Plan type depends on when your course started and where you were a resident when you applied, not your graduation date or where you studied. Always confirm via your online student loan account rather than guessing.
Mistake 2: Panicking about the total balance shown
The headline balance, often tens of thousands of pounds, rarely reflects what you’ll actually repay. What matters month to month is the 9% (or 6%) deduction above your threshold, not the outstanding total.
Mistake 3: Forgetting a second job pushes you over the threshold
Repayments are usually calculated per PAYE job, so if you have two part-time roles that individually sit below the threshold but combine to exceed it, you may need to declare this via Self Assessment to repay the correct amount.
Mistake 4: Not checking Plan 5’s lower threshold before budgeting
Graduates starting on Plan 5 sometimes budget using older Plan 2 figures they’ve seen online. Plan 5’s £25,000 threshold is meaningfully lower, so repayments start sooner and bite harder at lower salaries.
Mistake 5: Ignoring how student loan repayments interact with pension contributions
Increasing your pension contributions through salary sacrifice reduces your taxable income, which can also reduce your student loan repayment, since it’s calculated on the same income figure used for tax.
Frequently asked questions
Do I have to pay off my student loan before I stop working?
No. Student loans are written off after a set period, usually 30 years for Plan 2 and Plan 5, or 25 years for Plan 1, measured from the April you were first due to repay. Most borrowers never clear the balance before it’s written off.
What happens if my income drops below the threshold?
Repayments simply stop for any month or tax year your income falls below your plan’s threshold. There’s no penalty and nothing you need to apply for; it adjusts automatically through PAYE.
Can I use a student loan calculator UK 2026 tool if I’m self-employed?
Yes, the same thresholds and rates apply, but repayments are calculated annually through your Self Assessment tax return rather than deducted monthly, based on your total taxable income for the year.
Does my student loan affect my credit score?
No. Student loans don’t appear on your credit file and have no impact on mortgage affordability assessments in the way other debts do, though lenders will factor in the monthly repayment deduction from your net income.
What if I have loans under more than one plan?
You repay each plan according to its own threshold and rate at the same time. Someone with a Plan 2 loan and a Postgraduate Loan repays 9% above £29,385 and 6% above £21,000 simultaneously, both deducted from the same payslip.
Will my student loan repayment change if I get a pay rise?
Yes. Because repayments are a percentage of income above your threshold, any pay rise that pushes more of your salary over that line increases your monthly deduction proportionally.
Whether you’re a recent graduate weighing up your first job offer or comparing salaries before a career move, understanding your real take-home pay matters. Browse current vacancies at UK Jobs Alert’s job listings to find roles that match the salary and repayment picture that works for you.
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