Student Loan Calculator UK
Work out your student loan repayments and exact salary after student loan for the 2026/27 tax year. Use our free student loan repayment calculator uk to calculate deductions for Plan 1, Plan 2, Plan 4, Plan 5, and Postgraduate loans alongside Income Tax and National Insurance.
| Payroll Item | Without Loan | With Student Loan |
|---|---|---|
| Gross Pay | £38,000.00 | £38,000.00 |
| Income Tax | -£4,706.00 | -£4,706.00 |
| National Insurance | -£2,034.40 | -£2,034.40 |
| Workplace Pension | -£1,900.00 | -£1,900.00 |
| Student Loan (UG + PG) | £0.00 | -£857.70 |
| Net Take-Home Pay | £29,359.60 | £28,501.90 |
How the UK Student Loan Calculator Works (2026/27 Tax Year)
Using an accurate student loan calculator allows you to calculate exactly how much money HMRC deducts from your monthly payslip and what your true salary after student loan will be. For British graduates, student loan repayments function like an additional graduate income tax rather than a conventional commercial bank loan: deductions are based entirely on your earnings above statutory repayment thresholds, not on your total outstanding debt balance.
Whether you are subject to Plan 1, Plan 2, Plan 4 (Scottish), the post-2023 Plan 5, or a Postgraduate loan, our free student loan repayment calculator uk provides an instant, side-by-side view of your PAYE Income Tax, Class 1 National Insurance, pension contributions, and net take-home pay for the 2026/27 UK tax year (6 April 2026 to 5 April 2027). You can cross-reference your total earnings with our core Salary Calculator UK.
Crucial Rule for UK Graduates: You never repay your student loan unless your gross taxable income exceeds your plan’s statutory threshold (£28,470 for Plan 2, £26,065 for Plan 1, £32,745 for Plan 4, £25,000 for Plan 5, and £21,000 for Postgraduate loans). If you earn £1 below the threshold in any pay period, your repayment is exactly £0.00.
UK Student Loan Repayment Plans & Thresholds for 2026/27
The Student Loans Company (SLC) and HM Revenue & Customs (HMRC) administer five distinct repayment plans. Each plan has its own repayment threshold, interest calculation methodology, and statutory write-off period. Our student loan calculator uk incorporates the official 2026/27 rates:
| Loan Plan | Who It Applies To | Annual Threshold | Monthly Threshold | Repayment Rate | Write-Off Period |
|---|---|---|---|---|---|
| Plan 1 | English & Welsh students starting pre-Sept 2012; all Northern Ireland students | £26,065 | £2,172.08 | 9% | 25 years or age 65 |
| Plan 2 | English & Welsh undergraduate courses starting 1 Sept 2012 – 31 July 2023 | £28,470 | £2,372.50 | 9% | 30 years |
| Plan 4 | Scottish students funded by the Student Awards Agency Scotland (SAAS) | £32,745 | £2,728.75 | 9% | 30 years or age 65 |
| Plan 5 | English undergraduate courses starting on or after 1 August 2023 | £25,000 | £2,083.33 | 9% | 40 years |
| Postgraduate | Master’s and Doctoral courses in England & Wales (post-2016) | £21,000 | £1,750.00 | 6% | 30 years |
Understanding Your Specific Plan
- Plan 1: Covers UK students who took out loans before September 2012, as well as all students funded by Student Finance Northern Ireland. Repayments are 9% on gross earnings above £26,065.
- Plan 2: The most widespread plan across the UK workforce, covering students who studied in England and Wales between 2012 and 2023. Repayments are 9% on income above £28,470. Because interest rates on Plan 2 are linked to RPI plus up to 3%, many graduates will never clear the principal balance before the 30-year statutory write-off.
- Plan 4: Specifically applies to Scottish undergraduate and postgraduate students who received tuition fee and maintenance support through SAAS. Scottish borrowers benefit from the highest threshold in the UK at £32,745, repaying 9% on earnings above that figure.
- Plan 5: Introduced for new English undergraduate starters in the 2023/24 academic year. Plan 5 sets a lower threshold of £25,000, charges interest pegged strictly to RPI (no +3% penalty), and extends the write-off horizon from 30 to 40 years, meaning far more graduates will repay their balances in full.
- Postgraduate Master’s & Doctoral Loans: Repayments are 6% of earnings above £21,000. Crucially, postgraduate loans run concurrently alongside your undergraduate plan.
Dual Loan Repayments: The 15% Marginal Trap
A common surprise for UK professionals with both an undergraduate degree and a Master’s or PhD is that repayments are stacked. Unlike some international loan systems, holding a Postgraduate loan does not replace your Plan 2 or Plan 1 debt.
If you hold both Plan 2 and a Postgraduate loan and earn £45,000:
- Plan 2 Repayment: 9% of income above £28,470 = (£45,000 – £28,470) × 9% = £1,487.70 per year (£123.98 per month).
- Postgraduate Repayment: 6% of income above £21,000 = (£45,000 – £21,000) × 6% = £1,440.00 per year (£120.00 per month).
- Total Student Loan Deduction: £2,927.70 per year (£243.98 per month).
On all earnings above the Plan 2 threshold (£28,470), you face a combined student loan deduction rate of 15%. Test different salary amounts with our student loan take home pay calculator above to see how this dual deduction affects your monthly budget.
Combined Marginal Deduction Rates in 2026/27
When evaluating a pay rise, promotion, or new job offer, it is vital to understand your marginal deduction rate—the percentage of every additional £1 earned that is lost to statutory deductions. When student loans are combined with PAYE Income Tax and Class 1 National Insurance (8% main rate), UK graduates face some of the highest marginal deduction rates in Europe:
| Salary Band | Income Tax | Employee NI | Plan 2 (UG) | Postgrad (PG) | Total Marginal Rate |
|---|---|---|---|---|---|
| £12,571 to £28,470 | 20% | 8% | 0% | 0% / 6% | 28% to 34% |
| £28,471 to £50,270 | 20% | 8% | 9% | 6% | 37% to 43% |
| £50,271 to £100,000 | 40% | 2% | 9% | 6% | 51% to 57% |
| £100,001 to £125,140 (60% Tax Trap) | 60% | 2% | 9% | 6% | 71% to 77% |
| Over £125,140 (Additional Rate) | 45% | 2% | 9% | 6% | 56% to 62% |
As demonstrated in the table above, an employee earning £55,000 with a Plan 2 loan loses 51p of every extra £1 earned (40% Higher Rate tax + 2% National Insurance + 9% student loan). If they also have a Postgraduate loan, their marginal deduction climbs to 57%!
Even more dramatically, graduates caught in the infamous £100,000 to £125,140 Personal Allowance taper face an astonishing 71% to 77% marginal deduction rate. You can verify how your tax code interacts with this taper using our Tax Code 1257L Guide and Tax Code Calculator.
How Salary Sacrifice Reduces Your Student Loan Repayments
One of the most effective, HMRC-approved methods for reducing your student loan deductions is Salary Sacrifice (also known as salary exchange).
Under a formal salary sacrifice arrangement, you agree to reduce your contractual cash salary in exchange for an employer-provided benefit, such as increased workplace pension contributions, a cycle to work bicycle, or an electric vehicle (EV) lease.
Because student loan deductions are calculated on your contractual gross pay subject to Class 1 National Insurance, sacrificing salary reduces your assessed earnings pound-for-pound. For example, if you earn £40,000 on Plan 2 and sacrifice £3,000 into your workplace pension:
- Your gross earnings assessed by payroll fall from £40,000 to £37,000.
- You save 20% in Income Tax (£600).
- You save 8% in National Insurance (£240).
- You save 9% in Student Loan repayments (£270)!
- Total immediate relief: 37% (£1,110). Your £3,000 pension investment only reduces your take-home pay by £1,890.
Benchmark Matrix: Salary After Student Loan (2026/27)
The benchmark matrix below generated by our student loan take home pay calculator demonstrates annual and monthly student loan deductions alongside total net take-home pay across key UK salary milestones for the 2026/27 tax year (assuming standard 1257L tax code, England & Wales, and 5% standard pension):
| Gross Salary | No Loan Net Pay | Plan 1 Deduction | Plan 2 Deduction | Plan 4 Deduction | Plan 5 Deduction | Plan 2 Net Pay |
|---|---|---|---|---|---|---|
| £25,000 | £20,959 / yr | £0 / mo | £0 / mo | £0 / mo | £0 / mo | £1,747 / mo |
| £30,000 | £24,359 / yr | £29.51 / mo | £11.48 / mo | £0 / mo | £37.50 / mo | £2,018 / mo |
| £35,000 | £27,559 / yr | £67.01 / mo | £48.98 / mo | £16.91 / mo | £75.00 / mo | £2,248 / mo |
| £40,000 | £30,759 / yr | £104.51 / mo | £86.48 / mo | £54.41 / mo | £112.50 / mo | £2,477 / mo |
| £50,000 | £37,159 / yr | £179.51 / mo | £161.48 / mo | £129.41 / mo | £187.50 / mo | £2,935 / mo |
| £60,000 | £42,859 / yr | £254.51 / mo | £236.48 / mo | £204.41 / mo | £262.50 / mo | £3,335 / mo |
| £80,000 | £52,459 / yr | £404.51 / mo | £386.48 / mo | £354.41 / mo | £412.50 / mo | £3,985 / mo |
| £100,000 | £62,059 / yr | £554.51 / mo | £536.48 / mo | £504.41 / mo | £562.50 / mo | £4,635 / mo |
If you work varying hours or are paid on an hourly or daily basis, explore our specialized Hourly Take Home Pay Calculator and Daily Rate Calculator to model student loan deductions against your day rate. For part-time roles or term-time contracts, our Part-Time Take Home Pay Calculator and Pro Rata Calculator provide accurate period adjustments.
PAYE Payroll Mechanics: How Deductions Happen
In the UK, student loan repayments are operated through HMRC’s PAYE system. Your employer does not deduct repayments on an annual basis; instead, the threshold is divided into payroll periods:
- Monthly Payroll: Annual threshold divided by 12 (e.g. Plan 2 threshold is £2,372.50 per month). Any earnings above £2,372.50 incur a 9% deduction in that calendar month.
- Weekly Payroll: Annual threshold divided by 52 (e.g. Plan 2 is £547.50 per week). You can model weekly payrolls using our Weekly Take Home Pay Calculator or view standard calendar payouts in our Monthly Take Home Pay Calculator.
The Bonus Effect: Because PAYE operates on individual pay periods, receiving an annual bonus, overtime payment, or commission can push your single-month income well over the monthly threshold, triggering a significant student loan deduction in that payslip—even if your total earnings over the full year end up below the annual threshold! If this occurs, you can claim a refund directly from the Student Loans Company after the end of the tax year. Model your bonus tax and loan impacts using our dedicated Bonus Tax Calculator.
Frequently Asked Questions About UK Student Loans
In the UK, student loan repayments are calculated as a percentage of your gross earnings above a statutory repayment threshold, rather than on the total amount you borrowed. For undergraduate loans (Plan 1, Plan 2, Plan 4, and Plan 5), you repay 9% of your income above the applicable plan threshold. For Postgraduate loans, you repay 6% of your earnings above £21,000. Repayments are deducted automatically by your employer through HMRC PAYE payroll.
For the 2026/27 tax year (6 April 2026 to 5 April 2027), the annual repayment thresholds are: Plan 1 is £26,065 (£2,172.08 per month); Plan 2 is £28,470 (£2,372.50 per month); Plan 4 (Scottish loans) is £32,745 (£2,728.75 per month); Plan 5 (students who started after August 2023) is £25,000 (£2,083.33 per month); and Postgraduate Master’s and Doctoral loans are £21,000 (£1,750.00 per month).
Yes. If you hold both an undergraduate loan (such as Plan 2) and a Postgraduate loan, the deductions run concurrently. You will repay 9% on earnings above your undergraduate threshold plus 6% on earnings above £21,000. On earnings exceeding the undergraduate threshold, your combined student loan deduction rate is 15%.
Student loans do not appear on your credit report and do not damage your credit score. However, mortgage underwriters must include your monthly student loan deductions when assessing your net disposable income and affordability. Lower monthly take-home pay can reduce the maximum mortgage borrowing limit offered by lenders.
If your income falls below the plan threshold in any given pay period (e.g. £2,372.50 per month on Plan 2), student loan deductions immediately stop. Unlike commercial debt, you do not face penalties or arrears when you earn below the threshold.
Cancellation rules depend on your plan. Plan 1 loans are written off after 25 years or at age 65 depending on when they were taken out. Plan 2 loans and Postgraduate loans are written off 30 years after the April following your graduation. Plan 4 loans are written off after 30 years or at age 65. Plan 5 loans are cancelled after 40 years. Any remaining balance is written off by the government with zero tax consequences.
Yes! Because salary sacrifice legally reduces your contractual gross salary before payroll deductions, your student loan repayment is assessed on the lower post-sacrifice gross salary. Sacrificing salary into a pension or electric vehicle scheme saves you 9% in student loan deductions (or 15% with a postgraduate loan) on top of your Income Tax and National Insurance savings.
Student loan deductions are calculated on a pay-period basis. If a bonus pushes your earnings for that specific month or week over the pay-period threshold, 9% (and 6% for postgraduate loans) will be deducted from the excess in that payslip, even if your total annual salary remains near or below the annual threshold.