Take-home pay with student loan
Student loan repayments for 2026/27 are 9% of income above the plan threshold, or 6% for a Postgraduate Loan, under gov.uk's rules for repaying your student loan. On a £35,000 salary on Plan 2, above the £29,385 threshold, the estimated repayment is £505 a year.
How is my student loan repayment calculated?
The student loan is not a flat percentage of salary, under gov.uk's rules for repaying a student loan.
It is 9% of the part of income that sits above the plan's threshold, or 6% for a Postgraduate Loan.
On a salary just above the threshold the deduction is small, and it grows as pay pulls further clear of that line.
The loan is collected through PAYE alongside income tax and National Insurance, but gov.uk treats it as a separate calculation from either.
The student loan does not lower taxable income, unlike a pension contribution.
Income tax and National Insurance are still charged on the whole salary, and the loan repayment is deducted on top, following gov.uk's guidance on repaying a student loan.
Adding a student loan to the same salary therefore reduces take-home pay noticeably, even though the tax code has not changed.
What would I repay on an example salary?
On a £35,000 salary on the Plan 2, the loan applies to income above £29,385. That leaves £5,615 exposed, and 9% of it is an estimated £505 a year. Adding that to an estimated £4,486 income tax and £1,794 National Insurance gives an estimated take-home of £28,215 a year, about £2,351.22 a month.
Common questions
How much is my student loan repayment?
You repay 9% of everything you earn above your plan’s threshold for undergraduate plans, or 6% for a Postgraduate Loan. It is not 9% of your whole salary, only the part over the threshold. That is why a small pay rise near the threshold changes the deduction less than people expect.
Which plan am I on?
It depends on where and when you studied. Plan 1 and Plan 2 cover most English and Welsh undergraduates by start date, Plan 4 is Scotland, Plan 5 is for courses starting from 2023 onward, and the Postgraduate Loan is separate. This tool lets you pick, with thresholds of £26,900 up to £25,000.
Is the student loan taken before or after tax?
It is worked out on your gross pay, like tax, but it does not reduce your taxable income. So you pay income tax and National Insurance on the full salary, and the loan deduction sits on top. All three come out through PAYE before the money reaches you.
Can I have two student loans at once?
Yes. If you have an undergraduate plan and a Postgraduate Loan, both are collected together, so you could pay 9% above one threshold and 6% above the other at the same time. This calculator handles one plan at a time; add the two deductions if you have both.
Should I overpay my student loan?
Often not. The loan is written off after a set period and behaves more like a graduate tax than a normal debt. Many people never repay it in full, so overpaying can waste money you would keep otherwise. It only makes sense if you are clearly going to clear the balance well before write-off.
How is my student loan repayment calculated?
Student loan repayments are 9% of income above the relevant plan threshold, or 6% for a Postgraduate Loan, following gov.uk's rules for repaying a student loan. The repayment is worked out on gross pay and is calculated separately from income tax and National Insurance, then deducted through PAYE on top of both. Income below the threshold carries no student loan deduction at all.
What would I repay on an example salary?
On a £35,000 salary on Plan 2, income above the £29,385 threshold is an estimated £5,615. Repaying at 9% gives an estimated student loan deduction of £505 a year. Combined with an estimated £4,486 of income tax and £1,794 of National Insurance, take-home pay is an estimated £28,215 a year, about £2,351.22 a month.
Sources & Rate Verification
Rates verified against official statutory guidance on 6 September 2026.