• Shopping Guides
    • Choose a supermarket
      • Aldi
      • ASDA
      • The Co-op
      • Iceland
      • Lidl
      • Marks & Spencer
      • Morrisons
      • Sainsbury’s
      • Tesco
      • Waitrose
    • Compare Supermarket Prices
      • Aldi
      • Asda
      • Boots
      • Iceland
      • Lidl
      • Morrisons
      • Ocado
      • Sainsburys
      • Tesco
      • Poundstretcher
      • Superdrug
      • Waitrose
    • Find a supermarket
    • Food Guides
      • Basmati Rice
      • Drinks & Wine Supermarket
      • E Numbers
      • Fairtrade
      • Food Labelling
      • Food Prices
      • Organic Food
      • Recycling
      • Supermarket Shopping Tips
      • Supermarket Own Brands
    • Organic shop
  • Travel Guides
  • Utilities
    • Broadband
    • Boilers
      • Boiler Insurance
      • Boiler Maintenance Cover
      • Boiler Servicing
      • Finding the Cheapest Boiler Service Quote
      • Oil Boilers
      • Boiler Types – which boiler is right for me?
    • Energy
    • Energy Suppliers
    • Switch and Save
  • Voucher Codes
    • Offers
    • Exclusive voucher codes
  • Finance
    • What are savings bonds?
      • Fixed Rate Bonds
    • Banking and saving
      • Bank Accounts
      • Current Accounts
      • Savings Accounts
      • Student Accounts
    • Investments
      • Investment Bonds
      • Premium Bonds
      • Annuities
    • Credit rating
      • What is a Credit Rating?
      • Improving My Credit Rating
    • Credit Cards
      • Repay Credit Cards or Save?
      • Transferring Credit Cards
      • 0% Interest Credit Cards
      • Balance Transfer Credit Cards
      • FAQ for Credit Cards
    • Loans
      • Personal loans guide
      • Types of Personal Loans
      • Do I Need a Loan?
      • Payday Loans
      • Car Loans
      • Compare Loans
    • Debt Problems
    • Mortgages
      • Right to Buy Mortgages
      • Self Build Mortgages
      • International Mortgages
      • Missold mortgages
    • Pensions
      • Starting a Pension
      • State Pensions
      • Pension Transfers
      • SIPP Pensions
      • Opting Out of a State Pension
      • Missold Pensions
    • Banking Claims
      • Payment Protection Insurance
      • Packaged Bank Accounts
      • Missold Mortgages
      • Missold Pensions
    • Reclaiming Bank Charges
  • Family and Income
    • Increase Your Income
      • Increasing Your Income
      • Selling on eBay – Earn Extra Income
      • Surveys for Cash
    • Students and School
      • Student Loan Entitlements
      • Student Loans
      • Student Loan Calculator
      • Repaying Your Student Loans
      • University Tuition Fees List
      • Introduction of Higher University Fees in 2012-2013
    • Tax and Benefits
      • Tax Credits
      • Council Tax
      • Housing Benefit
    • Car and Petrol Guides
      • Breakdown Cover
      • Save Money on Car Expenses
    • Save Money on Fuel
      • Petrol Cost Calculator
      • Litres per 100KM to MPG Converter
      • Petrol Usage Calculator
      • MPG Calculator
      • Petrol Required for Travel Calculator
      • Fuel table
  • Insurance
    • Breakdown Cover
    • Car Insurance
    • Dental Insurance
    • Health Insurance
    • Home Insurance
      • Buildings Insurance
      • Contents Insurance
    • Income Insurance
    • Life Insurance
    • Mortgage Protection Insurance
    • Travel Insurance
  • News
  • Shop
    • Baby and child
    • Beer, Wine and Spirits
    • Drinks
    • Food Cupboard
    • Health and Beauty
    • Bird and Wildlife Care
    • Household Supplies
    • Nappy Changing
    • Pets
    • Snacks
Supermarket.co.uk
  • View Basket
Supermarket.co.uk
  • Shopping Guides
    • Choose a supermarket
      • Aldi
      • ASDA
      • The Co-op
      • Iceland
      • Lidl
      • Marks & Spencer
      • Morrisons
      • Sainsbury’s
      • Tesco
      • Waitrose
    • Compare Supermarket Prices
      • Aldi
      • Asda
      • Boots
      • Iceland
      • Lidl
      • Morrisons
      • Ocado
      • Sainsburys
      • Tesco
      • Poundstretcher
      • Superdrug
      • Waitrose
    • Find a supermarket
    • Food Guides
      • Basmati Rice
      • Drinks & Wine Supermarket
      • E Numbers
      • Fairtrade
      • Food Labelling
      • Food Prices
      • Organic Food
      • Recycling
      • Supermarket Shopping Tips
      • Supermarket Own Brands
    • Organic shop
  • Travel Guides
  • Utilities
    • Broadband
    • Boilers
      • Boiler Insurance
      • Boiler Maintenance Cover
      • Boiler Servicing
      • Finding the Cheapest Boiler Service Quote
      • Oil Boilers
      • Boiler Types – which boiler is right for me?
    • Energy
    • Energy Suppliers
    • Switch and Save
  • Voucher Codes
    • Offers
    • Exclusive voucher codes
  • Finance
    • What are savings bonds?
      • Fixed Rate Bonds
    • Banking and saving
      • Bank Accounts
      • Current Accounts
      • Savings Accounts
      • Student Accounts
    • Investments
      • Investment Bonds
      • Premium Bonds
      • Annuities
    • Credit rating
      • What is a Credit Rating?
      • Improving My Credit Rating
    • Credit Cards
      • Repay Credit Cards or Save?
      • Transferring Credit Cards
      • 0% Interest Credit Cards
      • Balance Transfer Credit Cards
      • FAQ for Credit Cards
    • Loans
      • Personal loans guide
      • Types of Personal Loans
      • Do I Need a Loan?
      • Payday Loans
      • Car Loans
      • Compare Loans
    • Debt Problems
    • Mortgages
      • Right to Buy Mortgages
      • Self Build Mortgages
      • International Mortgages
      • Missold mortgages
    • Pensions
      • Starting a Pension
      • State Pensions
      • Pension Transfers
      • SIPP Pensions
      • Opting Out of a State Pension
      • Missold Pensions
    • Banking Claims
      • Payment Protection Insurance
      • Packaged Bank Accounts
      • Missold Mortgages
      • Missold Pensions
    • Reclaiming Bank Charges
  • Family and Income
    • Increase Your Income
      • Increasing Your Income
      • Selling on eBay – Earn Extra Income
      • Surveys for Cash
    • Students and School
      • Student Loan Entitlements
      • Student Loans
      • Student Loan Calculator
      • Repaying Your Student Loans
      • University Tuition Fees List
      • Introduction of Higher University Fees in 2012-2013
    • Tax and Benefits
      • Tax Credits
      • Council Tax
      • Housing Benefit
    • Car and Petrol Guides
      • Breakdown Cover
      • Save Money on Car Expenses
    • Save Money on Fuel
      • Petrol Cost Calculator
      • Litres per 100KM to MPG Converter
      • Petrol Usage Calculator
      • MPG Calculator
      • Petrol Required for Travel Calculator
      • Fuel table
  • Insurance
    • Breakdown Cover
    • Car Insurance
    • Dental Insurance
    • Health Insurance
    • Home Insurance
      • Buildings Insurance
      • Contents Insurance
    • Income Insurance
    • Life Insurance
    • Mortgage Protection Insurance
    • Travel Insurance
  • News
  • Shop
    • Baby and child
    • Beer, Wine and Spirits
    • Drinks
    • Food Cupboard
    • Health and Beauty
    • Bird and Wildlife Care
    • Household Supplies
    • Nappy Changing
    • Pets
    • Snacks
Repaying Your Student Loans
Home
Family & Income
Students and School

Repaying Your Student Loans

Students and School

Soaring tuition fees and high living costs are seeing students take out huge loans nowadays as they look to afford their university education, and it’s important to understand how these student loans are repaid.

The information in this guide is only applicable to students who started university on or after 01 September 1998.

You will start to repay your loans in the first April after finishing your studies, as long as you are employed and earning above a certain amount.

How your loan is repaid depends on whether you are employed or self-employed, while there are also two different repayment plans which are dependent on when you started university and your nationality.

Plan 1 applies to English and Welsh students who started university before 01 September 2012, and all Northern Irish and Scottish students.

Plan 2 applies to English and Welsh students who started on or after 01 September 2012.

Plan 1 students start to repay their loan when they earn more than £17,750 per annum, although this amount can change on 06 April each year. Meanwhile, Plan 2 students start to repay when they earn more than £21,000 per annum, but the threshold may change. Grants and bursaries do not need to be repaid.

If you are employed on a PAYE tax basis then repayments are taken out of your wage automatically by your employer, but it is recommended that you keep your P60 and payslips in case you ever need to claim a refund.

Student loans and tax

Student loans do not affect the amount of tax you pay. Although the contributions are calculated on your gross salary (pre-tax salary), they are actually taken out of your net salary (post-tax salary).

How is interest calculated?

The interest you are charged is tied to the UK Retail Price Index (RPI) – which is a measure of UK inflation, calculating changes to the cost of living in the UK.

Each September, the new student loan interest rate is charged by taking the RPI from the previous March and adding 3 per cent. For example, the RPI for March 2016 was 1.6 per cent, so plus 3 per cent gives an interest rate of 4.6 per cent.

In September 2017 the interest rate will be 6.1 per cent, due to the March 2017 RPI being 3.1 per cent. However, for students who started university before September 2012 their interest rates may be lower, so you should check with the Student Loans Company.

Interest on your student loans is added from the day the money is sent to you, and lasts for the lifetime of the loans.

Because the interest rates often change, it is advised to check the Student Loans Company website regularly to check how much you are being charged and any other important details.

Repaying if you are self-employed

If you are self-employed then you will need to report your income through self-assessment.

Also, if you know your loan is nearly paid off, you should state on your tax return that your loan will be fully repaid in the next two years. To avoid overpaying, send your online tax return before 01 November.

Student loans are wiped off eventually

Currently, student loans are cancelled after 30 years have passed since finishing university, if you are a student from England or Wales. For Scottish and Northern Irish students, the cut-off point is currently set at 35 and 25 years respectively.

This is regardless of how much you still owe, and if your income never rises above the threshold then you will never repay anything.

Additionally, if you become disabled, are registered as permanently unfit for work, or pass away, then the loan will be cancelled.

The majority of people will never completely repay their loans before they are wiped off. This is because they will simply not earn enough in the 30 years after graduation to completely repay their loans.

As such, it may not make financial sense for you to make early repayments to clear your debt.

You should look into your expected earnings and make calculations based on those figures, to find out whether you would benefit more from repaying early or whether you are best off leaving it and waiting for it to be wiped off.

Each year you will receive an annual statement from the Student Loans Company, showing how much you have repaid in the tax year. You can also log onto their website and view how much you owe, as well as information on making payments. This can be useful for deciding whether to repay your loan early.

Repaying from overseas

If you go abroad for more than three months then you are required to fill out an Overseas Income Assessment Form, and this needs to be done every year that you’re abroad.

It estimates your income for the next year, and ensures the Student Loans Company has your bank details so you can pay by Direct Debit. They will calculate whether you need to repay, and if so, how much.

Repayments are taken as normal if you work for a UK employer abroad. However, if you work for a foreign employer, then the repayments will depend on the minimum Plan 1 or Plan 2 threshold in that country.

Facebook Twitter Google+ LinkedIn Pinterest

Related Posts

Student Loan Calculator Students and School

Student Loan Calculator

Student Loan Entitlements - Fee Loans and Grants Students and School

Student Loan Entitlements - Fee Loans and Grants

Student Loans - What is a Student Loan? Students and School

Student Loans - What is a Student Loan?

Latest News
  • Asda
  • Sainsburys
  • Tesco
  • Morrisons
  • Waitrose
ASDA shoppers call for staff to be fired over 'unethical' £1.75 Jubilee party item - Manchester Evening News
16 May 2022
ASDA shoppers want staff to be fired over 'unethical' £1.75 Jubilee party item - My London
17 May 2022
Asda, Tesco, Morrisons and Sainsbury's customers warned not to eat chocolate following salmonella fears - Chronicle Live
17 May 2022
Asda, Sainsbury's, Morrisons, Tesco: Cheapest petrol and diesel prices in Lancashire on May 17 - Lancs Live
17 May 2022
Asda apologises as Ukrainian worker awarded £62k after resigning in tears following racial harassment - Leeds Live
16 May 2022
Ex-Sainsbury's CEO pins blame squarely on Brexit for food price rises - The National
16 May 2022
Asda, Tesco, Morrisons, Sainsbury's customers told not to eat chocolate amid salmonella fears - Liverpool Echo
17 May 2022
Asda, Costco, Sainsbury's: Cheapest places for petrol in and around Liverpool today - Liverpool Echo
17 May 2022
Sainsbury's £6 sandals which are perfect for the summer - Manchester Evening News
16 May 2022
The Sainsbury's store which will be opening on a pub car park - Birmingham Live
16 May 2022
Tesco to pay out more to pig farmers as industry warns of ‘critical’ situation - The Guardian
16 May 2022
Tesco Clubcard vouchers: millions set to expire soon - Which?
17 May 2022
Tesco trolleys have been dumped all over Beaumont Leys for years - and no one knows how to stop it - Leicestershire Live
16 May 2022
Tesco revealed as 'most sought after' supermarket for deals, new survey shows - Herts Live
16 May 2022
Up to 150 jobs on offer across Sainsbury's, Tesco, Morrisons and Asda - Bristol Live
17 May 2022
'I shopped Morrisons price cuts for my groceries and it was a difficult experience' - Daily Record
16 May 2022
Asda, Sainsbury's, Morrisons, Tesco: Cheapest petrol and diesel prices in Lancashire on May 17 - Lancs Live
17 May 2022
Asda, Tesco, Morrisons, Sainsbury's customers told not to eat chocolate amid salmonella fears - Liverpool Echo
17 May 2022
Morrisons gives away cornflower seeds for Queen's Jubilee - Telegraph and Argus
16 May 2022
Up to 150 jobs on offer across Sainsbury's, Tesco, Morrisons and Asda - Bristol Live
17 May 2022
Waitrose agree partnership with club for #Royals150 Legends match - Reading FC
13 May 2022
M&S, Pret, Aldi, Sainsbury's and Waitrose recall sandwiches and clear shelves in Salmonella chicken crisis - Wales Online
12 May 2022
Waitrose posts first statutory loss in 10 years - Retail Gazette
13 May 2022
Waitrose Takes Over Piccadilly Lights In Campaign For Essential Range - The Drum
25 April 2022
Waitrose, Stroud: Grocer 33 store of the week - The Grocer
6 May 2022
Supermarket Deals
Sammons Preston Lotion Applicator with Massage Head, Long Handle and Foam Massaging for Back, Easily Apply Lotions…
Sammons Preston Lotion Applicator with Massage Head, Long Handle and Foam Massaging for Back, Easily Apply Lotions…
£7.73
Buy From Amazon
Hardys VR Shiraz Wine, 75 cl
Hardys VR Shiraz Wine, 75 cl
Buy From Amazon
ManCave Essentials Wash Bag Set – Vegan
ManCave Essentials Wash Bag Set – Vegan
£35.00
Buy From Amazon
Pampers Pure Protection Size 5, 132 Nappies, 11 kg+
Pampers Pure Protection Size 5, 132 Nappies, 11 kg+
Buy From Amazon
EcoHydra Alcohol Free Foam Hand Sanitiser – 50ml | NHS Approved, Hospital Grade Sanitiser | Kills Up To 99.9999% of…
EcoHydra Alcohol Free Foam Hand Sanitiser – 50ml | NHS Approved, Hospital Grade Sanitiser | Kills Up To 99.9999% of…
£3.99
Buy From Amazon
Bomb Cosmetics Santa’s Sleigh Ride Handmade Wrapped Bath and Body Gift Pack, Contains 5-Piece, 480 g (Contents May Vary)
Bomb Cosmetics Santa’s Sleigh Ride Handmade Wrapped Bath and Body Gift Pack, Contains 5-Piece, 480 g (Contents May Vary)
£11.54
Buy From Amazon
Pampers New Baby 96 Nappies, 2 – 5 kg, Size 1
Pampers New Baby 96 Nappies, 2 – 5 kg, Size 1
£28.70
Buy From Amazon
Maker’s Mark 46 Kentucky Bourbon Whisky, 70cl
Maker’s Mark 46 Kentucky Bourbon Whisky, 70cl
£34.49
Buy From Amazon
Scrubbingtons Pit Stop Children’s Natural First Deodorant – Aluminium and Alcohol Free for Sensitive Skin 1 x 50ml
Scrubbingtons Pit Stop Children’s Natural First Deodorant – Aluminium and Alcohol Free for Sensitive Skin 1 x 50ml
£5.90
Buy From Amazon
E45 Daily Bulk Moisturiser Body Lotion for Dry Skin, Pack of 5 x 400 ml
E45 Daily Bulk Moisturiser Body Lotion for Dry Skin, Pack of 5 x 400 ml
£18.30
Buy From Amazon
E45 100g Itch Relief Cream
E45 100g Itch Relief Cream
£6.40
Buy From Amazon
Cobra Premium Beer, 12x620ml
Cobra Premium Beer, 12x620ml
£26.40
Buy From Amazon
Easiyo Unsweetened Natural Yogurt Mix Sachets, 6 x 140g – Each Makes 1kg
Easiyo Unsweetened Natural Yogurt Mix Sachets, 6 x 140g – Each Makes 1kg
£15.49
Buy From Amazon
Old Golden Hen Beer, 500 ml, Case of 8
Old Golden Hen Beer, 500 ml, Case of 8
£15.99
Buy From Amazon
Bath Bombs Gifts Set for Women Natural Bath Set Organic Essential Oil Handmade Bath Fizzy Vegan Spa Bath Kit to…
Bath Bombs Gifts Set for Women Natural Bath Set Organic Essential Oil Handmade Bath Fizzy Vegan Spa Bath Kit to…
Buy From Amazon
CeraVe Moisturising Cream for Dry to Very Dry Skin 454g with Hyaluronic Acid & 3 Essential Ceramides
CeraVe Moisturising Cream for Dry to Very Dry Skin 454g with Hyaluronic Acid & 3 Essential Ceramides
£12.80
Buy From Amazon
Bodylife Body Buffer, Puff, Exfoliating Bath & Shower Body Pouf, Scrunchie, Body Scrubber Blue & Green 55g Twin Pack
Bodylife Body Buffer, Puff, Exfoliating Bath & Shower Body Pouf, Scrunchie, Body Scrubber Blue & Green 55g Twin Pack
£6.99
Buy From Amazon
La Poderosa Merlot Red Wine 75 cl
La Poderosa Merlot Red Wine 75 cl
£9.50
Buy From Amazon
Baylis & Harding Fuzzy Duck Cotswold Floral Luxury Hand Wash and Lotion Set
Baylis & Harding Fuzzy Duck Cotswold Floral Luxury Hand Wash and Lotion Set
£12.00
Buy From Amazon
Little
Little
Buy From Amazon
Serenata Flowers
Advertisment
  • Click here - to select or create a menu
  • Compare Prices
  • Aldi
  • ASDA
  • Iceland
  • Lidl
  • Morrisons
  • Netto
  • Sainsbury’s
  • Somerfield
  • Tesco
  • Waitrose
  • Voucher Codes
  • Save on your gas bills
  • Save on your electricity bills
  • Save on your broadband
  • Supermarket news
  • Register
  • Log in
  • Visit the forum
  • Jobs
Follow us on facebook Follow us on twitter
  • About
  • Disclaimer
  • Our Ethics
  • Privacy Policy
  • Terms and Conditions
  • Cookie Policy