What is the Plan 2 student loan repayment threshold?
Where a link is marked *, it is a partner link — we receive commission at no extra cost to you. Links without a * earn us nothing. How we make money.
In short: Plan 2 loans (England/Wales undergraduates who started from September 2012) are repaid at 9% of income above the annual threshold. For 2026/27 the threshold is £29,385 — repayments start once your gross income exceeds that figure, and any outstanding balance is written off 30 years after the April you graduated.
Last reviewed:
Reviewed by Kaiser Khan
Plan 2 applies to most English and Welsh students who started an undergraduate course on or after 1 September 2012. You repay through PAYE alongside Income Tax and National Insurance once earnings pass the threshold, which is updated each tax year and applies from 6 April.
For 2026/27 the Plan 2 threshold is £29,385 a year (£2,448 a month before tax). You pay 9% only on income above that level — not on your whole salary. Earning £39,385 means £900 a year in repayments (9% of £10,000). If income drops below the threshold, repayments stop automatically until it rises again.
Interest on Plan 2 loans is linked to inflation (RPI) plus up to 3% depending on income while studying and after. The balance can grow, but repayments depend on earnings, not the outstanding amount. After 30 years from the April after graduation, any remaining debt is cancelled regardless of how much you repaid.
Plan 2 is separate from Plan 1 (pre-2012), Plan 4 (Scotland) and Plan 5 (England from 2023 starters, with a lower threshold but longer write-off period). Check your plan on your payslip or HMRC Personal Tax Account. Extra voluntary repayments reduce the balance but may not be optimal if you are unlikely to clear the loan before write-off.
Primary source: gov.uk/repaying-your-student-loan
Part of our Family & care
This quick answer sits inside our wider family & care hub — with sub-guides, calculators and step-by-step explainers on the same topic.
Read the full family & care guide →