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Plan 5 student loan repayment calculator (2026/27)
The newest UK student loan plan, for English students who started university from August 2023. £25,000 threshold (frozen, NOT uplifted annually), 9% rate, 40-year write-off (vs 30 for Plan 2). Designed by the 2022 Augar reforms to recover more loan principal across the working life.
Reviewed 29 April 2026 · 2026/27 rates verifiedAnnual student loan repayment
£450
£38/month equivalent · 9% on income above threshold
Show full breakdown
Where the maths goes
| Annual income | £30,000.00 |
|---|---|
| Undergrad thresholdLowest threshold of plan5 | £25,000.00 |
| Income above undergrad threshold | £5,000.00 |
| Undergrad repayment @ 9.0%9% on income above the threshold | £450.00 |
| Total annual repayment | £450.00 |
| Monthly equivalentHow it actually shows up on your payslip — divided by 12 | £37.50 |
Sensitivity: repayment at different incomes
Same plan set (plan5). Useful for planning raises, day-rate increases, or contract renewals — your SL repayment grows linearly above the threshold.
| Income | Annual SL | Monthly |
|---|---|---|
| £25,000 | £0 | £0 |
| £30,000 | £450 | £38 |
| £40,000 | £1,350 | £113 |
| £50,000 | £2,250 | £188 |
| £60,000 | £3,150 | £263 |
| £80,000 | £4,950 | £413 |
| £100,000 | £6,750 | £563 |
How Plan 5 actually works
Plan 5 is the post-2022-Augar-reforms loan scheme for English students. The mechanics: 9% of every pound of income above £25,000, with a 40-year write-off, the longest of any UK plan. Repayments via PAYE for employees, via self-assessment for self-employed / Ltd directors.
The three less-generous changes vs Plan 2
Plan 5 was deliberately designed to recover more of the loan principal vs Plan 2:
- Threshold £25,000 vs £29,385: you start repaying at lower income.
- Threshold frozen: as nominal earnings rise, more workers cross the threshold without any policy change. Fiscal-drag effect compounds annually.
- 40-year write-off vs 30: for someone graduating at 22, write-off is at age 63, basically the entire working life.
The one favourable feature: RPI-only interest , no income-banded uplift like Plan 2's RPI + 3% for high earners. So real interest is 0% on Plan 5; balance tracks inflation but doesn't grow in real terms.
Long-term economics: more like a graduate tax
For most Plan 5 borrowers the loan functions less like a true loan and more like a 40-year graduate tax. The Office for Budget Responsibility's 2023 analysis estimates that the proportion of Plan 5 borrowers who will repay in full before write-off is much higher than for Plan 2, but the total repayment value over a working life is also higher. Net effect: Plan 5 borrowers pay more, total, than they would have under Plan 2, but the government recovers a higher proportion of issued loans.
Plan 5 + Postgrad
Common combination for borrowers doing a Master's after a Plan 5 undergrad. Both plans stack: 9% above £25,000 (Plan 5) AND 6% above £21,000 (Postgrad). At £40,000 income that's £2,490/year, about £208/month of student loan deduction.
What this calculator doesn't cover
- Long-term balance projections.Plan 5's 40-year write-off and frozen threshold make year-by-year balance modelling complex, use MoneySavingExpert's calculator for the full trajectory.
- Interest accrual at RPI on your specific balance. SLC online account is authoritative.
- Mid-degree status: students who started before August 2023 but whose course was extended into 2023 may have mixed Plan 2 / Plan 5 components. Speak to SLC if your circumstances are unusual.
- Welsh and Scottish equivalents: Wales kept Plan 2-equivalent terms; Scotland kept Plan 4. Plan 5 is England-only.
Frequently asked questions
- Am I on Plan 5?
- Plan 5 covers English students who started undergraduate studies from August 2023 onwards (the new repayment terms introduced by the 2022 Augar review reforms). If you started university in autumn 2023, autumn 2024, or autumn 2025, you're on Plan 5. Welsh students from this period are on a different plan (Wales kept Plan 2-equivalent terms). Scottish students are on Plan 4. NI students are on Plan 1. So Plan 5 is specifically for English domiciled students at any UK university starting from August 2023.
- Why is Plan 5 less generous than Plan 2?
- Three changes vs Plan 2, all benefiting the Treasury rather than borrowers. (1) Threshold cut from £29,385 (Plan 2) to £25,000 (Plan 5), meaning you start repaying at a lower income. (2) Threshold FROZEN, no annual RPI uplift, so as nominal earnings rise the share of borrowers above threshold grows over time. (3) Write-off extended from 30 years to 40 years, many Plan 5 borrowers will repay throughout their working lives. The official rationale is making the system 'more sustainable', practically, it's a redistribution from graduates to taxpayers.
- What's the Plan 5 threshold for 2026/27?
- £25,000, same as it was when Plan 5 was introduced and it will remain frozen at this level. Plans 1, 2, and 4 are uplifted annually by RPI; Plan 5 (and Postgrad) are frozen. The freeze is a deliberate fiscal-drag policy: as wages rise nominally, more workers cross the threshold and start repaying. Combined with the lower starting threshold and 40-year write-off, Plan 5 is designed for the Treasury to recover more of the loan principal across the typical working life.
- How does the 40-year write-off compare to Plan 2's 30 years?
- Significantly longer. Plan 2 writes off after 30 years from when you became eligible to repay; Plan 5 writes off after 40 years. For someone who graduates at 22 and starts repaying at 23, Plan 2 writes off at 53; Plan 5 writes off at 63, basically state pension age. Most Plan 5 borrowers will be making 9%-above-£25k repayments for their entire working career. The economic effect: the loan acts more like a graduate-tax than a true loan for most borrowers.
- What's Plan 5's interest rate?
- RPI only, no income-banded uplift like Plan 2's RPI + 3% for high earners. This is the one favourable feature of Plan 5 vs Plan 2: real interest at 0%, meaning the balance tracks inflation but doesn't grow in real terms. The catch: the longer write-off and lower threshold mean total nominal interest paid is usually much higher than under Plan 2 because the repayment runs longer.
- Plan 5 + Postgrad: what do I pay?
- Plan 5's 9% rate kicks in at £25,000; Postgrad's 6% kicks in at £21,000. Both stack, they're not combined. At £30,000 income with both: Plan 5 × (30,000 − 25,000) × 9% = £450 + Postgrad × (30,000 − 21,000) × 6% = £540 = £990 total. At £40,000 income: Plan 5 × £1,350 + Postgrad × £1,140 = £2,490. Maximum combined effective rate is 15% on income above £25,000 (since both thresholds are below at that point).
- Should I make voluntary overpayments on Plan 5?
- Almost never. The 40-year write-off is so long that even sustained high earnings rarely justify overpayment. The MoneySavingExpert calculator (mse.me/student-finance) is the standard tool for modelling your specific case, the answer for the vast majority of Plan 5 borrowers is to pay the minimum 9%-above-£25k and put any spare cash into pension, ISA, or mortgage offset. The economics of Plan 5 are essentially that it functions as a graduate tax until write-off; trying to clear the balance early rarely pays off in expected-value terms.
- What happens if I move from Plan 2 to Plan 5 (e.g. by starting another degree post-2023)?
- You'd hold both plans simultaneously. The multi-plan rule applies: ONE 9% deduction at the LOWER threshold (Plan 5 at £25,000 in this case). The Student Loans Company allocates payments between Plan 2 and Plan 5 internally. If you're on Plan 2 with significant balance and considering returning to study under Plan 5, modelling the combined repayment trajectory across decades is worth doing, speak to SLC for projections specific to your case.
Related calculators
Plan 2 calculator
Sept 2012 – July 2023, the previous English plan.
Postgrad calculator
£21,000 at 6%, stacks on top of Plan 5 if you do a Master's.
Multi-plan calculator
Plan 5 + Postgrad worked example, plus other combinations.
Related guides
Reviewed: 29 April 2026 · See how we calculate · not financial advice.