Small Business Accountants

How do I pay my student loan?

Student loan repayments depend on your employment status and loan plan type. Employees have repayments deducted automatically from their salary through PAYE once their earnings exceed the plan threshold. Self-employed earners repay through the Self Assessment tax return by 31 January. Plan 1, 2, 4, 5, and Postgraduate loans all have different thresholds and repayment percentages set annually by the Department for Education.

By Jordan Macey MAAT Reviewed by Noor Fiaz Updated 16 Apr 2026 1

How do I pay my student loan? - Quick Answer - GoForma Small Business | UK Accountants & Tax Advisors

Key takeaways

Employees repay student loans automatically through payroll deductions once their earnings exceed the relevant plan threshold, with no action needed on their part.
Self-employed borrowers repay through their Self Assessment tax return, where HMRC calculates the student loan repayment amount based on the income reported.
For 2025/26, repayment thresholds are £24,990 (Plan 1), £27,295 (Plan 2), £31,395 (Plan 4, Scotland) and £21,000 for Postgraduate loans.
The repayment rate is 9% of income above the threshold for Plans 1, 2 and 4, while Postgraduate loan repayments are calculated at 6% of income above the threshold.
You can make additional voluntary repayments at any time through your online repayment account, by debit or credit card, bank transfer or cheque sent to the Student Loans Company.

If you're https://goforma.com/self-employed" target="_blank">self-employed, HMRC will work out your loan repayment amount from your tax return. You make your repayment the same time you pay your tax.

If you're an employee and your salary is above the minimum amount, your loan repayments will be deducted from your salary by your employer.

https://www.gov.uk/repaying-your-student-loan/make-extra-repayments" target="_blank">Additional repayments can be made through your https://www.gov.uk/sign-in-to-manage-your-student-loan-balance" target="_blank">online repayment account and by card, bank transfer or cheque.

Frequently asked questions

How do I repay my student loan if I am self-employed?

Self-employed borrowers repay through their annual Self Assessment tax return. When you file your return, you declare your income and HMRC calculates the student loan repayment based on your earnings above the relevant threshold. The repayment is collected alongside your income tax and National Insurance, typically as part of your January payment on account.

What are the student loan repayment thresholds for 2025/26?

For the 2025/26 tax year, the annual repayment thresholds are £24,990 for Plan 1, £27,295 for Plan 2, £31,395 for Plan 4 (Scotland) and £21,000 for Postgraduate loans. You only make repayments on earnings above your specific threshold. If your income falls below the threshold in any pay period, no repayments are due and no deductions will be made.

How much of my income goes towards student loan repayments?

You repay 9% of your income above the threshold for Plan 1, Plan 2 and Plan 4 loans. Postgraduate loan repayments are 6% of income above the Postgraduate threshold. If you have both an undergraduate and postgraduate loan, both repayment rates apply simultaneously, meaning you could repay up to 15% of income above the relevant thresholds.

Can I make extra payments to pay off my student loan faster?

Yes, you can make additional voluntary repayments at any time. You can pay through your online Student Loans Company repayment account, by debit or credit card, bank transfer or by sending a cheque. There are no penalties for overpayment. However, consider whether early repayment is worthwhile, as remaining balances are written off after the applicable period.

When is my student loan written off?

Plan 2 loans are written off 30 years after the April following your graduation. Plan 1 loans are written off when you reach age 65 or 25 years after the April you were first eligible to repay, depending on when you started. Plan 4 loans follow similar rules for Scottish borrowers. Any remaining balance after the write-off date is cancelled entirely.

What happens if I have two student loan plans at the same time?

If you have loans on multiple plans, such as an undergraduate Plan 2 and a Postgraduate loan, repayments are collected separately for each plan. Your employer deducts both amounts from your salary, and the combined deduction could be up to 15% of your income above the respective thresholds. Each plan has its own threshold and repayment rate.

How do I know which student loan plan I am on?

You can check your plan type by logging into your Student Loans Company online account. Plan 1 applies if you started before September 2012 in England or Wales, or studied in Northern Ireland. Plan 2 applies from September 2012 onwards in England or Wales. Plan 4 is for Scottish borrowers. Your payslip also shows your plan type.

Will my employer automatically deduct student loan repayments?

Yes, once HMRC notifies your employer that you have a student loan, repayments are deducted through PAYE whenever your earnings exceed the threshold for your plan. You do not need to arrange this yourself. If your employer has not received notification, you can contact HMRC or the Student Loans Company to ensure your records are updated correctly.

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