What this estimator works out
This estimator applies the standard UK student loan formula: you repay a fixed percentage of income above a threshold, and nothing on income below it. Enter your annual income, the threshold for your repayment plan and the repayment rate, and it returns the annual and monthly amounts.
The threshold and rate are editable rather than fixed, because they differ by plan and change most years. Take both from GOV.UK for your specific plan before relying on the result.
Enter your details
Before you enter your figures
- Identify your repayment plan first. Plan 1, Plan 2, Plan 4, Plan 5 and the postgraduate loan plan all use different thresholds and rates, and using the wrong one produces a badly wrong answer.
- Use gross annual income before tax. Repayments are calculated on gross pay, not take-home pay.
- Check the current threshold on GOV.UK. Thresholds are reviewed regularly and the default here will go out of date.
- If you have both an undergraduate and a postgraduate loan, calculate each separately and add them, as they are repaid concurrently at different rates.
Repayments depend only on income, not on how much you borrowed. Someone owing £30,000 and someone owing £70,000 repay identical amounts on the same salary. The balance affects only whether the loan is ever cleared before it is written off at the end of its term.
How this calculator works
The calculation applies one rate to income above one threshold:
Repayable income = income − threshold (never below zero)
Annual repayment = repayable income × repayment rate
Monthly repayment = annual repayment ÷ 12In practice repayments are deducted through PAYE on a pay-period basis, so a month with overtime or a bonus produces a larger deduction than a quiet month even if annual income is unchanged. The annual figure here is the more meaningful one.
The calculator does not model interest or the balance, because for most borrowers neither changes what is deducted from pay.
Worked example: £35,000 on a £27,295 threshold
Using the default figures — £35,000 income, a £27,295 threshold and a 9% repayment rate:
- Income above the threshold: £35,000 − £27,295 = £7,705
- Annual repayment: £7,705 × 9% = £693.45
- Monthly repayment: £57.79
Notice that the effective rate against total income is under 2%, not 9%. The 9% applies only to the £7,705 above the threshold. This is why a pay rise produces a much smaller increase in repayments than people expect: a £2,000 rise adds £180 a year to repayments, or £15 a month.
Common mistakes
- Using the wrong plan's threshold. The difference between plans is thousands of pounds of threshold and changes the answer substantially.
- Applying the repayment rate to total income. It applies only to the amount above the threshold.
- Using take-home pay. The calculation is on gross income.
- Forgetting a postgraduate loan. It is repaid at the same time as an undergraduate loan, at its own rate and threshold.
- Assuming voluntary overpayment is worthwhile. For many borrowers the balance is written off before it is repaid, in which case overpaying is money given away.
Frequently asked questions
Should I pay my student loan off early?
For many borrowers, no. Because repayments depend on income and the balance is written off after a set period, a large number of people never repay the full amount. Overpaying only helps if you would otherwise clear the loan before write-off, which generally means high lifetime earnings relative to the balance. It is worth modelling before making voluntary payments — and clearing higher-rate commercial debt almost always comes first.
What happens if my income falls below the threshold?
Repayments stop automatically. They restart if your income rises above the threshold again. Nothing is owed for the period below it, and no arrears accrue.
Does the interest rate matter?
Less than most people expect, because it affects the balance rather than the monthly deduction. It matters only for borrowers likely to repay in full before write-off, for whom a higher rate means paying more in total. For everyone else it changes a number on a statement and nothing else.
Is it deducted automatically?
If you are employed, yes — through PAYE alongside tax and National Insurance. If you are self-employed, it is collected through Self Assessment. If you move abroad, you must tell the Student Loans Company and arrange repayment directly, as overseas thresholds differ by country.
Where do I find my plan type and current threshold?
Sign in to your Student Loans Company repayment account, or check GOV.UK, which publishes current thresholds and rates for every plan. Your payslip will also show which plan is being deducted.
Related tools
References
- GOV.UK — current student loan repayment plans, thresholds, rates and write-off periods
- MoneyHelper — guidance on whether voluntary student loan overpayment is worthwhile
Sources are checked at publication and can change — how I choose and check references.