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UK student loans — how repayment really works

Student loans are collected through PAYE (or Self Assessment) based on income above a threshold, and are written off after a set period.

Student Loans3 min readReviewed July 2026

UK student loans are 'income-contingent'. You only start repaying when your income exceeds the threshold for your plan, and repayments are 9% of income above the threshold (6% for Postgraduate loans). If your income drops, repayments drop or stop.

Balances are written off after a set number of years — 30 years for most Plan 2 and Plan 5 borrowers, 40 years for many Plan 5 borrowers, and other periods for other plans. Because of write-off, many borrowers never repay in full — and paying extra voluntarily is often not worthwhile.

Student loans are not included in typical debt solutions like DMPs or IVAs. They don't affect your ability to get a mortgage in the same way as consumer debt, though the monthly deduction does affect affordability.

Guidance, not personalised helpThis article is written to inform. It isn't personalised debt or legal advice — a Debt Compass adviser will discuss your options and eligibility with you before you choose a route.