Postgraduate Loan repayments are 6% of your income above £21,000 a year (£1,750 a month or £403 a week) in 2026 to 2027. If you also have an undergraduate loan you repay both at the same time, so the 6% is added to the 9% you pay on your other plan.
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This page deals only with the Postgraduate Loan. For how the undergraduate plans compare, see student loan plan types explained.
Who has a Postgraduate Loan?
The Postgraduate Loan plan covers English and Welsh borrowers who took out a loan for a master’s or doctoral course. gov.uk lists it separately from Plans 1, 2, 4 and 5.
Not every postgraduate borrower is on it. Scottish students are on Plan 4 whether their course was undergraduate or postgraduate, and all Northern Ireland students are on Plan 1. Their postgraduate borrowing is repaid at 9% under those plans, not at 6%.
What is the Postgraduate Loan threshold and rate for 2026 to 2027?
HMRC’s employer guidance sets these figures with effect from April 2026:
| Item | Postgraduate Loan, 2026 to 2027 |
|---|---|
| Yearly threshold | £21,000 |
| Monthly threshold | £1,750 |
| Weekly threshold | £403.84 (shown as £403 on the borrower pages) |
| Repayment rate | 6% of income above the threshold |
| Earliest start | The April after you leave your course |
| Interest (English loans) | Normally RPI plus 3%, capped at 6% from 1 September 2026 to 31 August 2027 |
| Cancellation | 30 years after repayments are due to start |
| Self Assessment box | Box 3 on the paper return, the postgraduate option online |
As with other plans, the size of the balance has no effect on the yearly repayment. Only income above the threshold counts.
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How does it run alongside an undergraduate plan?
Many graduates hold a Postgraduate Loan and a Plan 2 or Plan 5 loan. The 2026 to 2027 terms and conditions say you repay them at the same time, as long as your income is over the repayment threshold. gov.uk puts it this way: you repay 6% of your income over the Postgraduate Loan threshold and 9% of your income over the lowest threshold of any other plan you have.
That means the two deductions are worked out separately against different thresholds. They are not combined into one rate applied to one figure.
HMRC tells employers that an employee may have to repay a postgraduate loan at the same time as a student loan, and to start the deductions from the next available payday. The payroll guide to student loan deductions covers the employer side.
How much would I repay with both loans?
Illustration only. Sam studied an English undergraduate degree starting in 2018 (Plan 2) and then a master’s funded by a Postgraduate Loan. In 2026 to 2027 Sam earns a salary of £40,000, paid evenly each month, and has no other income.
- Postgraduate Loan: £40,000 minus £21,000 is £19,000. At 6% that is £1,140 for the year.
- Plan 2: £40,000 minus £29,385 is £10,615. At 9% that is £955.35 for the year.
- Total student loan repayments: £2,095.35 for the year, or about £175 a month.
If Sam’s salary fell to £25,000, the Plan 2 deduction would stop because pay is below £29,385, but the Postgraduate Loan deduction would continue at 6% of the £4,000 above £21,000, which is £240 for the year.
How does my employer take Postgraduate Loan deductions?
Employers calculate the deduction on the same gross pay they use for employer’s secondary Class 1 National Insurance. They learn about the loan from your P45, the starter checklist, your own confirmation or a PGL1 start notice from HMRC, and they stop when HMRC sends a PGL2 stop notice. An employer cannot stop deductions because you ask, and cannot take deductions in arrears.
If you have more than one job, repayments are only taken from a job where you are paid over the threshold, not on your combined income. Check your payslips and your P60 at the end of the year.
When do I repay through Self Assessment?
If you file a tax return and repayments were due to start on or before 6 April of the year the return covers, you must complete the student loan section, and if you have both types of loan you complete both parts. For the Postgraduate Loan you put the total deducted by your employers in box 3 on the paper return, or choose the postgraduate option online.
HMRC then works out 6% of your total Self Assessment income above the threshold. Total income includes all employment income combined, self employed profits, property income and unearned income over £2,000. Amounts already taken through payroll are credited against what you owe. If you work under the off payroll working rules, the repayments for that period are made through Self Assessment. The guide to student loan repayments through Self Assessment covers the return in more detail, and Self Assessment deadlines sets out when the balance is due.
Do not include voluntary payments in the employment deduction figure on the return. HMRC can check a return or payroll, and the accountant’s fees for dealing with it can be insured through tax investigation insurance.
Can I get a refund if I overpay?
Yes, in several cases. gov.uk allows a refund if:
- your income for a tax year that has ended was below £21,000, the Postgraduate Loan threshold;
- a deduction was taken before you were due to start repaying;
- you have paid the loan off and deductions carried on, which can take around 4 weeks to stop; or
- you have overpaid and have not heard from the Student Loans Company.
For a below threshold refund you sign in to your repayment account and ask. For other reasons you contact the Student Loans Company with your customer reference number. You can only ask about tax years that have ended, and extra voluntary repayments cannot be refunded. The terms and conditions say credit balances are refunded to your bank account where possible, so keep your contact and bank details up to date.
Frequently asked questions
Is the Postgraduate Loan rate 6% or 9%?
It is 6% of income above £21,000 for the Postgraduate Loan plan. The 9% rate applies to Plans 1, 2, 4 and 5, including postgraduate borrowing by Scottish and Northern Irish students.
Do I pay 15% on everything above £21,000?
No. The 6% is measured from £21,000 and the 9% from the lowest threshold of your other plan, such as £29,385 for Plan 2 or £25,000 for Plan 5. Income between £21,000 and that higher threshold only attracts the 6%.
When is a Postgraduate Loan written off?
For English borrowers, the 2026 to 2027 terms say any balance left 30 years after repayments are due to start is cancelled, provided you have made all the repayments due based on your income.
Does interest on a Postgraduate Loan change my repayments?
No. Interest increases the balance, normally at RPI plus 3% with a 6% cap between 1 September 2026 and 31 August 2027, but your yearly repayment is still set by income above the threshold. See also tax on students’ part time work if you are still studying.
If HMRC opens a check into your return, tax investigation insurance pays your accountant’s fees. Solar Protect cover pays up to £100,000 with no excess; it never pays tax, interest or penalties. Read how our cover works or get a quote.
Sources
- GOV.UK: When you start repaying
- GOV.UK: Special rules for student loans
- GOV.UK: Which repayment plan you are on
- GOV.UK: What you pay
- GOV.UK: Student loans a guide to terms and conditions 2026 to 2027
- GOV.UK: Tell hmrc about a student loan in your tax return
- GOV.UK: Getting a refund
Reviewed by Christine Anderson, Broker, Solar Protect. Last reviewed 8 November 2026. Part of Accountapedia, the Solar Protect guide to UK tax and accounting. This page is general information, not personalised advice.