Employers must collect student loan repayments from employees by deduction from their pay where their income exceeds the threshold for their loan type.
For 2026/27, the loan thresholds are:
- £26,900 for Plan 1 student loans
- £29,385 for Plan 2 student loans
- £33,795 for Plan 4 student loans
- £25,000 for Plan 5 student loans
- £21,000 for Post graduate loans.
Deductions are made at 9% of earnings in excess of the threshold for student loans and at 6% of earnings in excess of the threshold for post graduate loans.
HMRC have updated their guidance for employers on collecting student loan and post graduate loan repayments.
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