Student Loan Repayment Calculator

For 2026/27 you start repaying once your income is over the threshold for your plan: Plan 1 £26,900, Plan 2 £29,385, Plan 4 £33,795, Plan 5 £25,000 and the Postgraduate Loan £21,000. These thresholds apply from 6 April 2026, and your employer deducts repayments through payroll once your pay crosses them.

You repay 9% of your income above your plan's threshold (6% for a Postgraduate Loan), worked out each pay period by your employer. For example, earning £35,000 on Plan 2 means you pay 9% on the £5,615 above the £29,385 threshold — £505.35 a year, or about £42 a month. Your payslip shows this separately from income tax and National Insurance.

No, the £90,000 VAT registration threshold does not affect student loan calculations. Student loan repayments are based solely on your personal taxable income and the specific plan you are on, not on business turnover or VAT registration status. HMRC treats these as separate compliance obligations with no cross-impact.

Self-employed individuals must report their student loan liability through the Self Assessment tax return, as PAYE cannot deduct it automatically. You calculate the 9% on profits above the threshold and pay it alongside your income tax bill by 31 January. Failure to declare this can lead to penalties from HMRC under the new MTD ITSA rules.

The £500 dividend allowance does not change the income threshold for student loan repayments. Contractors on the dividend track still pay 9% on total income exceeding the threshold, including dividends taxed above the allowance. Your total taxable income for this purpose includes all sources, regardless of the dividend tax rates applied.