You start repaying a student loan in England the April after you finish or leave your course, and only once your income is above your plan's threshold. Plan 2, for courses started from 2012 to July 2023, has a £29,385 threshold and a 30-year write-off. Plan 5, for courses from August 2023, has a £25,000 threshold and a 40-year write-off.
Are you on Plan 2 or Plan 5?
Your plan depends on when your course started, not when you graduate. If you are from England and started an undergraduate course or PGCE between 1 September 2012 and 31 July 2023, you are on Plan 2. If you started on or after 1 August 2023, you are on Plan 5. Advanced Learner Loans follow the same dates, and Lifelong Learning Entitlement loans from 2027 are Plan 5. You can check your plan in your online repayment account.
How do Plan 2 and Plan 5 compare?
| Feature | Plan 2 | Plan 5 |
|---|---|---|
| Who | Courses started 1 Sep 2012 to 31 Jul 2023 | Courses started on or after 1 Aug 2023 |
| Threshold, 2026/27 tax year | £29,385 a year (£2,448 a month) | £25,000 a year (£2,083 a month) |
| Repayment rate | 9% above threshold | 9% above threshold |
| Interest, Sep 2026 to Aug 2027 | 4.1% to 6% depending on income (capped at 6%) | 4.1% |
| Write-off | 30 years after first due to repay | 40 years after first due to repay |
| Future threshold | Frozen at £29,385 until April 2030 | £25,000 until April 2027, then rises with RPI |
When exactly do repayments start?
Repayments are first due in the April after you finish or leave your course. If you graduate in summer 2026, your first possible repayment is from April 2027. If you leave a course early, the same rule applies: the April after you leave. Part-time students on long courses can be due to start repaying after four years even if still studying.
Being "due" does not mean you will pay. From that April, money is only taken in pay periods where your income is above the threshold. If you are earning less, or not working, you pay nothing and there is no penalty. The write-off clock starts from that first April, whether or not you are actually repaying.
How are repayments collected?
For most people, repayments come out of your salary automatically. HMRC tells your employer to deduct student loan repayments through PAYE, and they appear on your payslip next to tax and National Insurance. Each job is assessed separately against the threshold. If you are self-employed, or file a tax return for other reasons, HMRC calculates what you owe through Self Assessment, based on your total income for the year, and you pay it with your tax bill.
Keep your payslips and P60. If too much is deducted, for example because your pay went over the threshold in one month but your annual income was below it, you can claim a refund from the Student Loans Company. Near the end of your loan, you can switch to Direct Debit to avoid overpaying.
How much would you repay on each plan?
Both plans take 9% of income above the threshold, so the difference is where the threshold sits. The table shows yearly repayments at different salaries in the 2026/27 tax year.
| Salary | Plan 2 (above £29,385) | Plan 5 (above £25,000) |
|---|---|---|
| £25,000 | £0 | £0 |
| £30,000 | £55 (about £5 a month) | £450 (about £38 a month) |
| £40,000 | £955 (about £80 a month) | £1,350 (about £113 a month) |
| £50,000 | £1,855 (about £155 a month) | £2,250 (about £188 a month) |
Plan 5 borrowers pay more each month at the same salary and for up to ten years longer, but their interest rate is lower. For Plan 5 detail, see our Plan 5 guide.
How does interest differ between the plans?
From 1 September 2026 to 31 August 2027, RPI is 4.1%. Plan 5 interest is RPI only, so 4.1% for everyone. Plan 2 interest is normally RPI plus up to 3%, which would be 7.1%, but the government announced a cap of 6% for this year. While studying, Plan 2 borrowers are charged 6%. After leaving, the rate depends on income: 4.1% if you earn £29,385 or less, rising gradually to 6% at £52,885 or more.
Is the Plan 2 threshold frozen?
Yes. The November 2025 Budget froze the Plan 2 repayment threshold at £29,385, along with the £52,885 upper interest threshold, from April 2027 until April 2030. After that it is due to rise with inflation again. A frozen threshold means Plan 2 graduates whose pay rises will repay a little more each year. The Plan 5 threshold of £25,000 is set to start rising with RPI from April 2027.
What if you have both plans, or move abroad?
If you have loans on more than one plan, for example a Plan 2 degree and a Plan 5 Lifelong Learning Entitlement loan later, you repay 9% of income above the lowest of your thresholds, shared between the loans. If you move abroad for more than three months, tell the Student Loans Company. You will be set repayments based on your overseas income, and failing to report the move can lead to arrears.
Can you repay early, and should you?
You can make voluntary repayments at any time without penalty, but they cannot be refunded. Because many borrowers will have part of their loan written off, paying early does not always reduce what you pay overall. This is a personal decision and not something we advise on; use the gov.uk repayment guidance or an independent adviser.
Figures in this guide are for the 2026/27 academic year and are general information, not financial advice. Confirm the latest details on gov.uk before you apply.
What does this mean if you are thinking about studying now?
New students starting in 2026/27 will be on Plan 5. Repayments only start after you finish and earn over £25,000. If you want to explore courses first, browse courses, read what Student Finance England is, or message us on WhatsApp for free course guidance.
Sources
- GOV.UK: Which repayment plan you are on
- GOV.UK: Repaying your student loan, what you pay and interest
- GOV.UK: When your student loan gets written off or cancelled
- Student Loans Company: Interest rates and repayment threshold announcement (August 2026)
- GOV.UK: Make extra repayments
- GOV.UK: Repaying if you leave the UK