How to Calculate Student Loan Repayments in the UK: Step-by-Step Guide

Introduction

Tax in the UK is worked out in layers: allowances first, then bands, then separate charges such as National Insurance and student loans. Once you see each layer, the numbers on your payslip stop being a mystery.

This guide explains how to calculate student Loan Repayments in the UK, step by step. Find out how much you repay on your student loan each month for Plan 1, 2, 4, 5 and Postgraduate loans. You'll see the formula, a fully worked example and practical tips for UK readers.

What this calculation covers

Find out how much you repay on your student loan each month for Plan 1, 2, 4, 5 and Postgraduate loans.

Knowing your figures helps you check your payslip, negotiate pay, plan pension contributions and avoid a surprise bill from HMRC. Mistakes in tax codes are common, and HMRC will only refund what you notice and claim.

The method and formula

You repay 9% of income above your plan's threshold (6% for Postgraduate Loans). Below the threshold you repay nothing. Interest and the loan balance do not change the monthly amount.

Every figure on our student Loan Repayment Calculator follows this method, so you can check the working yourself.

Worked example

Here's a typical example using these figures:

Running them through the method gives:

The headline figure is repayment per month: £48.97. Change any input and the result will move with it.

How to use the calculator

1. Enter or choose annual salary (£).
2. Enter or choose repayment plan.
3. Read your results. The main figure is shown at the top, with a breakdown underneath.
4. Try different values to compare scenarios side by side.

Tips for UK readers

• Check your tax code on every payslip. 1257L is the standard code for 2025/26; anything else deserves a quick look in your HMRC app.
• Pension contributions and salary sacrifice reduce your taxable pay, which matters most if you're near a band threshold.
• If your income is between £100,000 and £125,140, you lose personal allowance and face an effective 60% marginal rate. Pension contributions can bring it back.
• Keep records of expenses and allowances you can claim, such as working-from-home costs, professional fees and uniform cleaning.

Frequently asked questions

What's the quickest way to work out student Loan Repayments?

Use our free student Loan Repayment Calculator. It applies this method automatically: You repay 9% of income above your plan's threshold (6% for Postgraduate Loans). Below the threshold you repay nothing. Interest and the loan balance do not change the monthly amount.

When does the UK tax year start?

The UK tax year runs from 6 April to 5 April the following year. Most allowances and bands reset on 6 April.

Where can I check the official rates?

GOV.UK publishes all current income tax, National Insurance and student loan rates. Our figures are based on the tax year shown on each calculator.

Is this calculator a substitute for advice?

No. It gives a clear estimate for common situations. For complex cases such as multiple incomes, benefits in kind or residency questions, speak to an accountant or HMRC.

Summary

To work out student Loan Repayments, follow the method above: You repay 9% of income above your plan's threshold (6% for Postgraduate Loans). For a quick, accurate answer with your own figures, use the calculator.

Next, read Student Loan Repayments: Common Mistakes, Tips and FAQs.