On Plan 5 (courses starting from August 2023) you repay 9% of what you earn above £25,000 a year, taken automatically from your pay once you earn over that amount. Repayments start the April after you finish your course. Interest is added at 4.1%, but your monthly repayment depends only on your income, not on how much you owe. Anything left is written off after 40 years.
What you pay at different salaries
| Your yearly salary | You repay each month |
|---|---|
| £20,000 | £0 |
| £25,000 | £0 |
| £30,000 | £37.50 |
| £40,000 | £112.50 |
| £50,000 | £187.50 |
| £60,000 | £262.50 |
The formula is simple: (salary − £25,000) × 9% ÷ 12. Use the slider on our Student Finance page to try your own salary.
Why it is not like a bank loan
- You repay nothing while you study.
- If your income falls below the threshold, repayments stop.
- The size of the debt does not change your monthly repayment.
- After 40 years, any balance that is left is written off.
How repayments are collected
If you are employed, your employer deducts repayments from your pay when you earn over the threshold. If you are self-employed or complete a Self Assessment tax return, HMRC calculates repayments yearly from your return. If your annual income ends up below the threshold, you can ask for a refund of repayments taken.
Interest
Plan 5 loans currently carry 4.1% interest. Interest is added even when your income is below the threshold, but because the loan is written off after 40 years, many graduates do not repay the full balance. Rates can change, so check gov.uk for the current figure.
How Plan 5 compares with older plans
| Plan | Yearly threshold |
|---|---|
| Plan 1 | £26,900 |
| Plan 2 | £29,385 |
| Plan 4 (Scotland) | £33,795 |
| Plan 5 | £25,000 |
| Postgraduate Loan | £21,000 (6%) |
Courses starting from 1 January 2027 are funded through the Lifelong Learning Entitlement, which according to current information keeps the same repayment rules.
Quick answers
Do I repay while I study?
No. Repayments start the April after you finish or leave your course, and only if you earn over the threshold.
What if I work two jobs?
Only income above the threshold from each job counts, and you make one deduction per pay period. HMRC sorts out any difference at the end of the year.
Is the Maintenance Loan repaid in the same way?
Yes. The Tuition Fee Loan and the Maintenance Loan are repaid together through the same 9% deduction. The Childcare Grant and the Parents' Learning Allowance are not repaid.
Sources: gov.uk: what you pay back.
Disclosure: AdmitGo is free for students and is paid by partner universities when a student enrols. This guide is general information, not legal or financial advice. Student Finance England decides every application.