How do I repay?
The way you repay your loan depends on your plan type. This information is for Plan 2 loans (loans taken out from 1 September 2012).
If you also have a Plan 1 loan (loans taken out before 1 September 2012) you should also read the section What if I have both a Plan 1 and Plan 2 loan?
If you’re employed
If your income is over the threshold of £21,000 a year, £1,750 a month or £404 a week your employer will automatically take 9% of your income above the threshold from your salary along with tax and National Insurance.
The student loan repayment amount taken will show on your payslip. For more information on how much your repayments might be read the section How much do I repay?
Your employer tells HM Revenue & Customs (HMRC) how much student loan you’ve repaid.
After the end of the tax year HMRC tells us how much you’ve repaid for that year.
We’ll apply the repayments you’ve made to your balance and work out the interest to be added.
For more information on interest read the section How much do I repay?
If you’re self assessed
If you’re self assessed (for example you’re self employed) and your income is over £21,000 a year you’ll repay at the same time as you pay your tax.
When you fill in your tax return you should indicate you have a student loan. HMRC will then calculate how much you should repay based on your income for the tax year.
HMRC will let you know your total tax liability for the year which will include any student loan repayments you are due to make. You’ll repay to HMRC directly.
HMRC tells us the total amount of student loan repayments you’ve made in the tax year. This information is received separately, and later, than information about repayments you may make through PAYE.
When do I start repaying?
If you’re studying or studied a full-time course, you’ll start repaying your loan the April after you finish your course.
If you’re studying or studied a part-time course, you’ll start repaying:
- The April four years after the start of your course, or
- The April after you finish or leave your course,
whichever comes first. If you leave your course early, you may have to begin repaying before this.
Making extra repayments
You can make voluntary repayments at any time. Any voluntary repayments you make won’t affect the amount collected through the tax system. So, if you’re employed and earning over the threshold, your employer will continue to take repayments from your salary. If you repay through self assessment, you’ll still have to repay the amount based on your income for the year.
If you make a voluntary repayment, you’ll not be:
- Charged an early repayment fee
- Able to get a refund of any amounts you repay.
You can find out more about the different repayment methods available and how to make a voluntary repayment.
Find out your loan balance
There’s also a Balance Calculator to work out how much you have left to repay. You’ll need your most recent payslips or self assessment information. This is important as we won’t know what you’ve repaid until after the current tax year.
If you go overseas
If you’re planning to travel, work or study overseas for more than three months, after you’re due to repay, you may still need to make repayments direct to us. It’s also important you let us know and keep your contact details up to date. For more information on how to repay read the repaying from overseas section.
When will I get a statement?
In the April before you’re due to start repaying your loan we’ll send you a statement telling you how much you owe at that point.
Once you start repaying your loan we’ll send you a statement showing any repayments collected. The timing of this statement could vary depending on when we get this information from HMRC.
If you’re repaying from overseas we’ll send you a statement each year showing the repayments you’ve made directly to us.
Coming to the end of repayments
After the end of the tax year, HMRC let us know how much you’ve repaid through the tax system for that financial year. As we only receive this annually, it’s likely you’ll repay more than you owe. To prevent this, pay particular attention to your repayments so you can:
- Switch to repaying by direct debit (available if you’re expected to finish repaying within 4 to 23 months)
- Request a settlement figure to pay off your loan in full (you can do this at anytime)
To do either contact us on: 0300 100 0611 (Mon to Fri 8am – 8pm or Sat 9am – 4pm).
If you’re overseas call: +44 141 243 3660
You can’t change to direct debit if you have both a Plan 1 and a Plan 2 loan. Read the What if I have both a Plan 1 and a Plan 2 loan section for more information.
Allowing someone else to deal with your account
The Data Protection Act prevents us from discussing your account with anyone other than you. However, you can nominate a person to deal with your account on your behalf.
You can give us this authority in two ways:
Consent to Share
This is written or verbal authorisation which allows us to discuss your account information (excluding bank details) to a person you have nominated.
Power of Attorney
This is an official legal document where you can grant attorney to a third party to release or update information relating to your account.
For more information on how to set up Consent to Share or Power of Attorney read the section Allowing another person to access your account.
When will loans be cancelled?
Any outstanding balance will be written cancelled:
- 30 years after you become eligible to repay
- If you become disabled and permanently unable to work
- If you die
Advanced Learner Loan cancellation
If you’re undertaking an Access to HE Diploma and then go on to complete an HE qualification the outstanding balance of your Advanced Learner Loan will be cancelled. To qualify for this cancellation you must have fully completed both courses. You do not need to take out a loan for the HE course. However, it must be eligible for funding by Student Finance England. The HE course does not have to relate to the Access to HE course you complete.
Wales only - partial cancellation of Maintenance Loan
If you lived in Wales and took out a Maintenance Loan since academic year 2010/11 the Welsh Government could cancel up to £1,500 from your student loan balance when you start repaying. For further details go to www.studentloanrepayment.co.uk