Repayment thresholds for student finance confirmed
Repaying student finance can seem complicated, with a number of different plan types each having different repayment thresholds. The thresholds for the forthcoming year have just been confirmed. What’s the full story?
If your employees have an outstanding student loan, HMRC will notify you via a start notice. You must then deduct repayments via the payroll. From your perspective as the employer, this is straightforward, as the payroll software should work out the correct amount in each pay period. You just need to ensure you set them up on the correct loan type. However, an awareness of the thresholds is still worth having, as it can help inform decisions about pay rises or bonuses. The thresholds for 2026/27 will be as follows (previous levels in brackets).
- Plan 1 — £26,900 (£26,065)
- Plan 2 — £29,385 (£28,470)
- Plan 4 — £33,795 (£32,745)
- Plan 5 — £25,000 (first year in operation)
- postgraduate loan — £21,000 (unchanged)
Above these thresholds, repayment is at 6% for postgraduate loans, and 9% for all other types.
Related Topics
-
Why is HMRC checking PVA more often?
Your business imports goods and accounts for VAT by applying postponed VAT accounting (PVA) on its returns. HMRC is scrutinising returns and issuing large assessments in some cases. What can you do to reduce the risk of getting it wrong?
-
HMRC text or scam? Check before you act
HMRC is contacting some taxpayers by text this week about overdue Self Assessment liabilities and is also sending updates about VAT registration applications. At the same time, it has expanded its guidance on spotting fake HMRC messages on social media. How can you tell whether a message is genuine?
-
Received a P800? Check how HMRC has used your allowances
Some HMRC P800 tax calculations can produce too much tax where a taxpayer has several different types of income and allowances are not allocated in the most favourable way. People with employment or pension income alongside savings, dividends or other income are particularly at risk here. Could HMRC be charging you too much?
This website uses both its own and third-party cookies to analyze our services and navigation on our website in order to improve its contents (analytical purposes: measure visits and sources of web traffic). The legal basis is the consent of the user, except in the case of basic cookies, which are essential to navigate this website.