UK student loan plans — migration and repayment guide

The five active UK plans in 2026

The threshold values move each tax year. We have deliberately left them as “Estimate” in the table below, the current values are published on gov.uk and worth checking directly. The rates have not changed since each plan was introduced.

Plan 1 in detail

Plan 1 covers England and Wales students who began their undergraduate course before 1 September 2012, and Northern Ireland students from the inception of the NI loan scheme. The threshold is the lowest of the five plans, meaning Plan 1 borrowers typically start repaying at a lower salary than Plan 2 or Plan 5. The interest rate on the underlying loan is set by reference to the Bank of England base rate plus 1%, capped at the prevailing inflation measure.

Plan 2 in detail

Plan 2 covers the large bulk of English and Welsh graduates from the 2012 to 2022 cohort. The threshold is higher than Plan 1, the repayment rate is the same 9%, and the loan terms, including a longer repayment window and a higher interest-rate cap, make this the plan with the largest unpaid balances overall. Most Plan 2 borrowers will not fully repay before the loan is written off.

Plan 4 (Scotland) in detail

Plan 4 is the Scottish plan, and the rules differ from the English plans in two practically-relevant ways. First, the threshold sits between Plan 1 and Plan 2. Second, Scotland- domiciled students who were previously on Plan 1 had their loans migrated to Plan 4 in April 2021. If you are a Scottish graduate and your payslip still shows “Plan 1”, that is a migration the payroll software has missed.

Plan 5 in detail

Plan 5 is the newer English plan, applying to undergraduates who started a new course on or after 1 August 2023. The threshold is lower than Plan 2, the rate is the same 9%, and the repayment window is longer. Practically, Plan 5 means more graduates repay something each month from sooner after graduation, while still reaching full repayment less often than on the older plans. The 2026 cohort entering the workforce is the first wave to start being deducted under Plan 5 at scale.

Postgraduate Loan in detail

The Postgraduate Loan (PGL) was introduced for English and Welsh Master’s and Doctoral students from 2016 onwards. It runs in parallel with the undergraduate plan, not instead of it. The PGL threshold is the lowest of the five, and the rate is 6%, not 9%. A graduate who is repaying both a Plan 2 undergraduate loan and a Postgraduate Loan therefore has two separate deduction lines on every payslip and a combined effective marginal rate of 15% on earnings above the higher of the two thresholds.

What plan migration looks like on a payslip

Migration between plans happens occasionally, Scotland-domiciled borrowers moving from Plan 1 to Plan 4 in 2021 is the headline example. Less dramatic but more common is the moment your individual record on the Student Loans Company side is updated (course completion confirmed, course outcome changed, transfer between SLC and Scottish Awards Agency for example), and HMRC sends a fresh start or stop notice to your employer.

On a clean migration the payslip behaviour is straightforward. The existing student loan deduction line stops; the new plan line starts in the next pay period. If you see both lines running for the same period, you are being double-deducted and should raise it immediately with payroll, they will need to re-process the HMRC notice file.

When course outcomes change

Three scenarios trip up borrowers and payroll:

• Course withdrawn before completion. The loan is still owed but the “start of repayment” date may shift. Confirm directly with SLC, because HMRC will not pick this up automatically.
• Course completed in a different jurisdiction. A student who began in England and graduated in Scotland (or vice versa) may end up needing a plan switch. The authoritative record is SLC’s, not your university’s.
• Loan fully repaid mid-year. SLC tells HMRC; HMRC sends a stop notice to your employer; the deduction stops. Until the stop notice arrives, your employer is legally required to keep deducting. Any over-payment is reconciled by SLC and refunded directly.

How to confirm your plan with HMRC and SLC

1. Sign in to your HMRC personal tax account at gov.uk. Open the “Pay As You Earn” section.
2. Check the student loan section. HMRC shows the plan(s) being deducted against your record and the running total for the tax year.
3. Sign in to your Student Loans Company online account. Verify the plan registered against your record there.
4. If HMRC and SLC disagree, contact SLC first. SLC drives the underlying plan assignment; HMRC drives the payroll deduction.
5. Once HMRC and SLC agree, ask payroll to refresh the HMRC start / stop notice if your payslip is still wrong.

Joint Plan 2 + Postgraduate Loan repayments

The most common “two loans” case in 2026 is a Plan 2 undergraduate degree from the 2012–2022 cohort plus a Master’s degree funded by the Postgraduate Loan. Both run in parallel on the payslip; both have their own thresholds and their own rates. The PGL deducts at 6% above its threshold, the Plan 2 deducts at 9% above its threshold, and the two are calculated independently from gross pay (with NI-able earnings as the base, the same as for any single plan).

On the payslip this means you should see two distinct lines, usually labelled “Student Loan” (or “SL”) for the Plan 2 deduction and “Postgraduate Loan” (or “PGL”) for the second. If your payslip shows a single combined line, the deduction maths cannot be checked properly and you should ask payroll to re-issue with the breakdown shown.

When to ask payroll for a P2 / start-stop notice check

• A deduction is still showing months after you finished the course.
• You started a new job and the first payslip has no student loan deduction at all.
• The plan letter on your payslip does not match the one shown in your HMRC personal tax account.
• SLC has confirmed your loan is fully repaid but a deduction is still being taken.
• You have migrated plans (Plan 1 to Plan 5, Plan 1 to Plan 4, etc.) and both lines are showing.

Frequently asked questions

How many UK student loan plans are there in 2026?

Five repayment plans run in parallel on the UK payroll system in 2026: Plan 1 (older England and Wales loans, plus Northern Ireland), Plan 2 (England and Wales 2012 to 2022 cohort), Plan 4 (Scotland), Plan 5 (England, new from August 2023), and the Postgraduate Loan (PGL). Each has its own threshold and its own deduction rate, and a worker can be repaying more than one at the same time, most commonly Plan 2 plus PGL.

What does plan migration look like on a payslip?

Plan migration is the moment your employer's payroll software switches you from one plan to another, typically Plan 1 to Plan 5, or Plan 2 to Plan 5, when HMRC notifies your employer via the start / stop notice mechanism. On the payslip you would expect to see the existing "Student Loan" line stop, and a new line with the new plan reference begin. If both lines run for the same period you are being double-deducted and should query it.

How do I confirm the correct student loan plan with HMRC?

Sign in to your HMRC personal tax account and check the "Pay As You Earn" section. The student loan deductions HMRC has recorded against you, broken down by plan, are visible there. You can also call the Student Loans Company to confirm which plan(s) you are enrolled on. If HMRC and SLC disagree, the SLC enrolment record is authoritative for the underlying plan; HMRC drives the payroll deductions.

I have a Plan 2 loan and a Postgraduate Loan, what should my payslip show?

Two separate deduction lines. One labelled "Student Loan" (or "SL") for the Plan 2 deduction at 9% of earnings above the Plan 2 threshold, and one labelled "Postgraduate Loan" (or "PGL") for the PGL deduction at 6% of earnings above the PGL threshold. The two are calculated independently and shown separately. A combined single line is non-compliant.

When should I ask payroll for a P2 (start / stop) notice check?

Ask payroll to check the HMRC notice when: you have just finished a course but a deduction is still showing; you started a new job and the first payslip shows the wrong plan or no deduction at all; SLC tells you your loan is paid off but a deduction is still being taken; or you migrated plans (Plan 1 to Plan 5, etc.) and both old and new are showing.

Related checkers and guides

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• Methodology, DPIA & sub-processors

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• Student loan deduction checker

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• P60 reconciliation checker

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• Wrong tax code checker

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Last reviewed

Educational guidance only — not regulated financial or payroll advice. Always verify the current thresholds against the gov.uk “Repaying your student loan” publication and confirm with HMRC and the Student Loans Company before acting.