UK Student Loan Repayment in 2026: What You Actually Owe (All 5 Plans Explained)
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Here's what's actually happening in 2026, plan by plan, with real numbers.
Which Plan Are You On?
This isn't about how much you borrowed — it's about when and where you studied. Get this wrong and every other number in this article won't apply to you.
| Plan | Who It's For |
|---|---|
| Plan 1 | Started before Sept 2012 (England/Wales), or Northern Irish students |
| Plan 2 | English/Welsh students, started Sept 2012 – July 2023 |
| Plan 4 | Scottish students |
| Plan 5 | English students starting from August 2023 onward |
| Postgraduate | Master's or doctoral loans |
2026 Thresholds — The Actual Numbers
Each threshold is per pay period, not just an annual figure — so it's checked monthly (or weekly if you're paid weekly), not just totted up once a year.
| Plan | Annual Threshold (2026/27) | Monthly Equivalent | Repayment Rate |
|---|---|---|---|
| Plan 1 | £26,065 | £2,172 | 9% |
| Plan 2 | £29,385 | £2,449 | 9% |
| Plan 4 (Scotland) | £32,745 | £2,729 | 9% |
| Plan 5 | £25,000 | £2,083 | 9% |
| Postgraduate | £21,000 | £1,750 | 6% |
Notice Plan 5 has the lowest threshold of any undergraduate plan — meaning Plan 5 borrowers start repaying at a lower salary than anyone else, despite being the newest plan.
The Plan 2 Freeze — What Actually Changed
This is the part worth genuinely understanding if you're on Plan 2, because it's a quiet change that affects a lot of people without making dramatic headlines.
The Plan 2 threshold rose to £29,385 in April 2026 — but instead of continuing to rise with inflation as it used to, it's now frozen at that level for three years, until April 2030. The interest rate threshold is frozen too.
Here's why that matters more than it sounds like it should: as wages rise with inflation but the threshold stays still, more of your pay rise each year falls above the frozen line — meaning a growing share of any future pay increase gets pulled into the 9% repayment, year after year, for three years straight.
In practical terms: someone earning £30,416 in 2027-28 is estimated to pay around £93 more that year because of the freeze. By 2029-30, that rises to roughly £259 more annually — about £22 extra a month. Not dramatic in any single month, but it adds up steadily over the three-year freeze.
How the 9% Is Actually Calculated — A Real Example
This trips people up constantly: it's 9% of everything above the threshold, not 9% of your whole salary.
| Annual Salary | Plan | Amount Above Threshold | Annual Repayment | Monthly |
|---|---|---|---|---|
| £32,000 | Plan 2 | £2,615 | £235 | £19.59 |
| £32,000 | Plan 5 | £7,000 | £630 | £52.50 |
| £35,000 | Plan 2 | £5,615 | £505 | £42.08 |
| £35,000 | Plan 5 | £10,000 | £900 | £75.00 |
| £45,000 | Plan 2 | £15,615 | £1,405 | £117.08 |
Same salary, genuinely different repayment depending on which plan you're on — purely because of where the threshold sits. This is exactly why "how much will I repay" doesn't have one universal answer; it depends entirely on your specific plan.
Interest Rates — Also Different by Plan
Interest rates aren't uniform either, and they're tied to RPI inflation (currently 3.2% for the September 2025 – August 2026 period), with different formulas per plan.
| Plan | How Interest Is Calculated |
|---|---|
| Plan 1 / 4 | Lower of RPI or Bank of England base rate |
| Plan 2 / 3 | RPI plus up to 3% (income-dependent), capped at the "Prevailing Market Rate" — with a separate 6% cap from Sept 2026 |
| Plan 5 | RPI only — no additional percentage on top |
Plan 2 carries the highest potential interest rate of the group, since it's the only one that adds a real interest rate on top of inflation. Plan 5, despite its lower repayment threshold, actually has a gentler interest structure than Plan 2 in this specific respect.
Does Overpaying or Repaying Early Make Sense?
This genuinely depends on your specific numbers, and it's one of the most personal calculations in UK personal finance — there's no single right answer for everyone.
The honest framing: UK student loans are written off after a set number of years (typically 30-40 depending on plan), regardless of how much is left outstanding. If you're realistically never going to earn enough to clear the balance before it's written off, overpaying voluntarily can mean paying back money you'd never have actually owed under the standard system. If you're on track to clear it comfortably before write-off, the maths shifts — and overpaying could genuinely save on total interest.
See exactly what any loan repayment looks like month to month, with a full breakdown.
People Also Ask
What is the Plan 2 student loan threshold for 2026?
The Plan 2 repayment threshold rose to £29,385 from April 2026. Unlike previous years, this threshold is now frozen at that level for three years, until April 2030, rather than continuing to rise with inflation — meaning a growing share of future pay increases will fall above the threshold during that period.
Why was the Plan 2 threshold frozen?
The freeze was announced at the 2025 Autumn Budget as a way to increase government revenue from existing student loans without raising the headline repayment rate. By freezing the threshold while wages continue rising, more graduate income falls into the repayable band each year — a mechanism sometimes referred to as fiscal drag.
Which student loan plan has the lowest repayment threshold?
Plan 5, at £25,000 annually (£2,083 monthly), has the lowest threshold of the undergraduate plans, despite being the newest. This means Plan 5 borrowers start repaying at a lower salary than those on Plan 1, 2, or 4, even though their loan terms differ in other respects, such as the interest calculation method.
How much will I repay on a £35,000 salary?
This depends entirely on your specific plan. On Plan 2, the annual repayment would be roughly £505 (about £42/month). On Plan 5, with its lower threshold, the same salary results in roughly £900 annually (about £75/month) — illustrating how significantly the plan, not just the salary, determines the repayment amount.
Is it worth overpaying a UK student loan?
It depends heavily on individual earnings trajectory. UK student loans are written off after a set period regardless of remaining balance, so borrowers unlikely to clear the loan before write-off may end up overpaying money they'd never have actually owed. Those on track to clear the balance comfortably before write-off may benefit more from overpaying to reduce total interest. Estimating your own trajectory first is recommended before deciding.
Bottom Line
Five plans, five thresholds, and a 2026 change — the Plan 2 freeze — that quietly increases what a large number of borrowers will repay over the coming years without changing the headline 9% rate.
Know your plan, know your threshold, and if overpayment ever crosses your mind, work out your likely write-off trajectory first. That single number changes the entire decision.