How it works
UK student loans use income-contingent repayments: you pay 9% (undergraduate) or 6% (postgraduate) on earnings above your plan’s threshold. It comes out of pay like tax — but it’s not the same as Income Tax.
2025/26 thresholds (approx.)
- Plan 1 — repay above ~£25,000/year
- Plan 2 — repay above ~£29,385/year
- Plan 4 (Scotland) — repay above ~£25,000/year
- Plan 5 — repay above ~£25,000/year
- Postgraduate — 6% above ~£21,000/year (can stack with undergrad plan)
Example: £50,000 salary, Plan 2
Without a loan, take-home is about £3,293/month. With Plan 2, roughly £3,139/month — around £155/month to the Student Loans Company on top of tax and NI.
That’s why “£50k” doesn’t feel like fifty when you’ve got a Plan 2 hangover.
Try yours
Pick your plan under Advanced Features in TaxBite. The Tax Bite pie and verdict update instantly — perfect for job offers and pay-rise reality checks.
Open £50k + Plan 2 →Estimates only — SLC thresholds and payroll timing can differ slightly.