Repay your student loan

Last updated: 29 May 2018

If you take out a student loan when you're at college or university you have to repay it.

How you pay it back depends on whether you work for someone else (employed) or work for yourself (self employed).

If you're employed

If you took out your student loan on or after 1998, repayments will be taken from your wages. You'll see the repayments on your wage slip.

You'll start paying it back when you earn more than a certain amount of money, known as a 'salary threshold'.

The salary threshold is currently £19,390.

You must speak to your employer if your income is over the threshold and you aren't paying student loan payments.

If your salary drops below the salary threshold your payments will be stopped. They will only start again when you go over the salary threshold.

Find out more about repaying if you're employed on the Student Loan Repayment website.

If you're self-employed

Your student loan repayments will be done through your Self-Assessment tax return.

When you're filling in your Self-Assessment tax return tick the box saying you have a student loan.

You'll have to budget for student loan payments when you submit your Self Assessment tax return and pay HM Revenue and Customs (HMRC) at the end of January.

Keep your payslips, P60s and Self-Assessment tax forms to track your payments. You may need a refund.

Find out more information about repaying if you're self-employed on the Student Loan Repayment website.

This information applies to Student Loans Company (SLC) loans. If you took out a student loan between 1990 and 1 September 1998, SLC can help you find the right organisation to contact.

What you'll pay

It depends on what country you lived in when you applied for student funding.

If you applied for your loan in Scotland or Northern Ireland, you'll be on repayment Plan 1. You'll also be on Plan 1 if you took out your loan in England and Wales before 1 September 2012.

This means you'll pay 9% of the income you earn over the threshold to the Student Loan Company (SLC). This percentage stays the same if your salary rises.

The salary threshold is currently £19,390.

You'll be on repayment Plan 2 if you took out your loan in England and Wales after 1 September 2012.

Interest rates

The current interest rate for students on repayment Plan 1 is 1.75%.

There's information about historical interest rates on Plan 1 on the Student Loan Repayment website.

There's information on interest rates for Plan 2 on the Student Loans website.

Repaying from abroad

You have to continue making payments to your student loan if you're living or working abroad.

Contact the Student Loans Company (SLC) if you're working abroad for 3 months or longer. If you are, you'll need to:

SLC has different thresholds for other countries. The amount you pay may be more or less than you normally pay in the UK.

Paying it off quicker

You can repay your loan off whenever you want to by:

  • paying extra each month
  • making an extra one-off payment
  • paying it off in full

To make extra payments you have to set up an account with SLC. You may already have an account if you've checked your balance.

You'll need your SLC customer reference number (also known as an ART ID). It is normally 11 numbers long.

You can't get a refund on any extra payments.

Cancelling your student loan

If you took out your first student loan:

  • in or before academic year 2006/07, then it will be cancelled when you turn 65
  • in or after academic year 2007/08, then it will be cancelled 35 years after you became eligible to repay

Cancelling your student loan if you're permanently unfit for work

SLC can cancel the loan if you get a disability-related benefit and are permanently unfit for work.

You'll need to send them medical confirmation along with evidence of your disability benefit.

Contact the Student Loans Company to find out what evidence they need.

If you overpay your student loan

Contact the SLC if you think you've overpaid your student loan.

To get your refund you'll need to wait until the end of the tax year and then contact SLC again.

Find out more information if you've overpaid your student loan.