Plan 5 student loan repayment threshold rises to £26,025 from April 2027
Graduates on Plan 2 and on postgraduate loans will see no change. Their thresholds stay at £29,385 and £21,000 for the 2027-28 tax year.
Borrowers on Plan 5 student loans will start repaying only once their income passes £26,025 a year from 6 April 2027, up from £25,000 now. The Student Loans Company published the thresholds for the 2027-28 tax year on Thursday 12 November.
That is a rise of £1,025. Plan 5 covers people in England who began an undergraduate course, a PGCE or an Advanced Learner Loan on or after 1 August 2023, as well as anyone borrowing through the Lifelong Learning Entitlement.
For borrowers on Plan 2, which covers Student Finance England undergraduates who started between 1 September 2012 and 31 July 2023, nothing moves. Their repayment threshold, which doubles as the lower interest rate threshold, stays at £29,385 from 6 April 2027 to 5 April 2028. The upper interest threshold, above which the full rate applies, stays at £52,885.
Postgraduate Loan borrowers, on Plan 3, keep a threshold of £21,000.
Repayments are a fixed share of income above the threshold, not of the whole salary: 9% on Plans 1, 2, 4 and 5, and 6% on postgraduate loans. Employees have repayments taken from their pay alongside tax and National Insurance, and GOV.UK advises checking that the employer has them on the correct plan.
Thursday's announcement did not include 2027-28 thresholds for Plan 1 or Plan 4. GOV.UK currently lists the Plan 1 threshold as £26,900 a year.
