What happens to your student loan if you move abroad?
Moving overseas doesn’t make your student loan disappear. The Student Loans Company (SLC) continues to collect repayments regardless of where you live. The repayment rules are the same as in the UK, but the threshold you repay above is set per country, and you pay SLC directly instead of through your employer.
At a glance
Is it wiped?
When to tell SLC
What you repay
If you don't respond
You must tell SLC before you leave
If you’ll be outside the UK for more than 3 months, for work, travel or any other reason, you must tell SLC before you go. The duty is triggered by the length of the absence, not by whether you’ll be earning, and the Republic of Ireland counts as overseas. Under 3 months away you don’t need to tell SLC before you go: you stay a UK taxpayer, and repayments carry on through PAYE if you’re employed or Self Assessment if you’re self-employed.
- Update your employment details online. The service tells you exactly what SLC needs, and you can record that you’re unemployed.
- Give evidence of your income: usually your last three months’ payslips, or proof such as a recent bank statement if you’re not earning.
- SLC then sets a repayment schedule in pounds sterling for up to 12 months, or defers repayments for 12 months if you’re under your country’s threshold.
- Update your details every year. SLC reassesses your income annually, and you must tell it if your income changes in between.
Estimate your repayments in any country
Pick a destination, your plan and your salary. The estimator applies SLC’s 2026/27 threshold for that country, converts at the HMRC rate SLC uses, and shows what you’d repay each month next to the UK figure, plus what SLC charges instead if you don’t update your details.
Your repayment threshold in Australia
£29,385
the same as the UK’s £29,385
Monthly repayment
£79
9% of the £10,615 above your threshold: £955 a year, rounded down to whole pounds each month. The same as in the UK.
If you don't update your details
£409.00
a month, £330.00 more than your income-based figure, plus interest at the highest rate. It still reduces your balance, but unpaid months become arrears.
Interest while abroad
RPI + 1.4%
Based on the income you give SLC, against Australia’s interest thresholds of £29,385 to £52,885: RPI at the lower, RPI + 3% at the upper. The Plan 2 interest cap still applies.
SLC uses HMRC’s annual average rate: 1 Australian Dollar = £0.489572.
Country-by-country: how your threshold changes
SLC doesn’t use a single overseas threshold. Every territory is placed into one of 7 bands, from 0.2× to 1.4× the UK threshold, using the World Bank’s Price Level Index, a measure of local costs such as food, housing and transport. The bands are reset every 6 April, so your repayments can change even if your income hasn’t. Middle earners abroad feel this most: in a lower-band country, a mid-range income that would barely trigger repayments at home pulls a much bigger slice into the 9% repayment band.
The process is the same wherever you go: tell SLC before you leave, give details of your gross income (usually your last three months’ payslips), which SLC converts into pounds sterling, and update your details every year. Only the threshold changes by country. Skip the update and SLC charges the fixed monthly repayment for your country, which may be higher than an income-based amount.
| Band | Multiplier | Plan 2 threshold | Fixed monthly (Plan 2) | Territories |
|---|---|---|---|---|
| A | 0.2× | £5,875 | £81.80 | 15 · India, Pakistan, Nigeria, Egypt |
| B | 0.4× | £11,755 | £163.60 | 91 · South Africa, Thailand, Turkey, Malaysia |
| C | 0.6× | £17,630 | £245.40 | 41 · Portugal, Poland, Brazil, Singapore |
| D | 0.8× | £23,510 | £327.20 | 36 · Spain, France, Germany, Japan, UAE |
| EUK band | 1.0× | £29,385 | £409.00 | 48 · Australia, Canada, Ireland, Netherlands |
| F | 1.2× | £35,260 | £490.80 | 15 · United States, Switzerland, Iceland |
| G | 1.4× | £41,140 | £572.60 | 2 · Bermuda, Cayman Islands |
| Destination | Band multiplier | Plan 2 threshold | Plan 5 threshold | Fixed monthly (Plan 2) |
|---|---|---|---|---|
| Spain | 0.8× | £23,510 | £20,000 | £327.20 |
| UAE (Dubai) | 0.8× | £23,510 | £20,000 | £327.20 |
| Australia | 1.0× | £29,385 | £25,000 | £409.00 |
| Canada | 1.0× | £29,385 | £25,000 | £409.00 |
| New Zealand | 1.0× | £29,385 | £25,000 | £409.00 |
| United States | 1.2× | £35,260 | £30,000 | £490.80 |
Figures are SLC’s overseas thresholds for 2026/27, set against the UK Plan 2 threshold of £29,385. The band letters are ours; GOV.UK lists one row per territory. Every plan has its own table, and SLC revises every country each 6 April, so always check the latest figures on GOV.UK.
- Australia, Canada & New Zealand: sit in the same band as the UK (1.0×), so the threshold is identical to the home figure: £29,385 for Plan 2. The difference is mechanical: you pay SLC directly each month on a schedule built from your payslips, converted at HMRC’s annual average exchange rate.
- Spain & the UAE: both sit at 0.8×, band D of 7, which is £23,510 for Plan 2. Repayments start £5,875 of income earlier than at home. Dubai’s lack of local income tax makes no difference: your UK student loan is separate from local tax, so a tax-free income is caught sooner, not exempted.
- United States: 1.2× (£35,260 for Plan 2) lifts the threshold above the UK’s, so you keep more of your income before repayments begin. Only Bermuda and the Cayman Islands sit higher, at 1.4×.
- The lowest bands: 147 territories sit below Spain’s band, down to 0.2× (£5,875) in countries such as India, Pakistan and Nigeria, where even a modest local income converted to pounds can clear the threshold.
How SLC works out your income
SLC assesses your gross annual income in pounds sterling. If you’re paid monthly it takes your last three months’ payslips, averages them and multiplies by 12 (12 weekly or 6 fortnightly payslips work the same way). Regular bonuses, overtime and commission are inside that average; one-off payments are added afterwards; superannuation isn’t counted.
- Exchange rate: HMRC’s average rate for the most recent calendar year, reviewed every 6 April. It doesn’t follow month-to-month movements, so a currency swing changes nothing until the next April.
- Fees: you repay in pounds, and you bear any currency-conversion and bank-transfer costs yourself.
- Schedule: an income-based schedule runs for up to 12 months, then SLC reassesses. Tell SLC if your income rises or falls in between, so your repayments are reassessed.
- UK-taxed income: income already collected through PAYE or Self Assessment is disregarded, so you’re not assessed twice on the same money.
Interest while you’re abroad
For Plan 2, the interest rate is set from the income you give in your overseas assessment, using your country’s lower and upper interest thresholds, and applies for the length of that assessment. The sliding scale is the same shape as at home (RPI at the lower threshold, RPI + 3% at the upper), but the thresholds move with the band: Spain’s run from £23,510 to £42,310, the United States’ from £35,260 to £63,460, against £29,385 to £52,885 in the UK. The Plan 2 interest cap still applies.
If you don’t keep your employment details up to date, Plan 2 interest goes to the highest rate, capped at 6%, whatever your income, for as long as your details are out of date. Plan 1, Plan 4, Plan 5 and Postgraduate interest rates are not income-based, so an overseas assessment does not change them.
SLC doesn’t stop collecting. It charges the fixed monthly repayment for your country instead of an income-based figure. For Plan 2 in 2026/27 that is £327.20 in Spain and the UAE, £409.00 in Australia, Canada and New Zealand, and £490.80 in the United States.
- The fixed amount may be higher than an income-based repayment, because it is set from twice the median graduate salary rather than from your income.
- It is not an additional charge: every pound paid still reduces your balance. But every month you don’t pay it becomes arrears.
- Plan 2 interest moves to the highest rate, capped at 6%, for as long as your details are out of date.
- SLC can charge a penalty, demand the whole loan plus interest and penalties in one lump sum, and add the cost of tracing you and recovering the debt to your loan.
- SLC can take court action to recover the debt. A court order is enforced as a civil debt in the UK and abroad, and you bear the legal costs.
Student loans do not appear on credit reports or affect your credit score. GOV.UK says so in plain words, and that stays true abroad. Only a court judgment obtained after legal action could reach your credit file.
Returning to the UK
Update your employment details as soon as you’re back after more than 3 months away. If you don’t, SLC keeps charging you at the rate for the country you’ve left, which can mean paying more than you need to, or a higher interest rate. Once you’re in UK employment, PAYE deductions restart on top.
- PAYE deductions do not clear overseas arrears. Arrange any arrears separately with SLC’s arrears line on +44 141 243 3970.
- Short visits home of under 3 months don’t change your overseas status: your overseas schedule carries on.
- Interest reverts to the standard UK calculation from the date you return.
Practical steps before you move
If you’re planning to move abroad, take these steps to stay on top of your loan.
Tell SLC before you leave
If you’ll be away for more than 3 months, even if you won’t be earning. The Republic of Ireland counts as overseas.
Update your employment details online
Give the evidence the service asks for (usually three months’ payslips, or a bank statement if you’re not earning) so SLC sets an income-based schedule or defers your repayments for 12 months.
Check your country's threshold
Use the estimator above or the GOV.UK table for your plan, so you know what to expect before the first schedule arrives.
Set up a way to pay
A Direct Debit or an international debit card through your online account, or an international bank transfer quoting your customer reference number. You bear conversion and bank fees.
Keep records
Payslips, the evidence you sent, and every SLC letter and payment confirmation.
Set an annual reminder
SLC reassesses your income every year and any schedule lasts at most 12 months. Tell SLC sooner if your income changes.
Moving abroad: frequently asked questions
Does your student loan get wiped if you move abroad?
No. Moving abroad does not cancel your student loan or wipe the balance, and there is no rule that writes it off after three years overseas. Your loan is only written off at the end of your plan's term (25, 30 or 40 years depending on your plan), and that clock keeps running wherever you live. Write-off may not apply if you are in breach of your repayment obligations, and SLC can still recover repayments that were due before the write-off date.
What happens to my student loan if I move to Canada, Australia or New Zealand?
You must tell the Student Loans Company before you leave if you will be away for more than 3 months, then update your employment details online. Australia, Canada and New Zealand sit in the same price band as the UK, so your repayment threshold is identical to the UK figure (£29,385 for Plan 2 in 2026/27). You repay 9% of income above it directly to SLC each month, with your payslips converted at HMRC's annual average exchange rate.
Do I still repay my student loan in Dubai if there's no income tax?
Yes. UK student loan repayments are separate from local income tax, so a tax-free income in the UAE does not exempt you. The UAE sits in a lower band than the UK (£23,510 versus £29,385 for Plan 2 in 2026/27), so the same income starts repayments earlier than it would at home. If you do not update your details, SLC charges the UAE's fixed monthly repayment of £327.20 instead.
Which countries have a lower student loan repayment threshold?
SLC places every territory in one of seven bands from 0.2× to 1.4× the UK threshold, using the World Bank's Price Level Index. For Plan 2 in 2026/27, Spain and the UAE sit at £23,510 (0.8×); India, Pakistan and Nigeria at £5,875 (0.2×); the United States at £35,260 (1.2×); and only Bermuda and the Cayman Islands at £41,140 (1.4×). A lower threshold pulls more of a mid-range income into the 9% repayment band, so the same income repays more than it would in the UK.
Do I still pay my student loan if I move abroad?
Yes. Moving abroad does not cancel your student loan. You must tell the Student Loans Company before you leave if you will be away for more than 3 months, update your employment details with evidence of your income, and repay 9% (6% for Postgraduate loans) of income above your country's threshold directly to SLC. If your income is below the threshold, SLC can defer repayments for 12 months.
What happens if I don't tell SLC I've moved abroad?
SLC charges the fixed monthly repayment for your country: £327.20 a month in Spain, or £409.00 in Australia for Plan 2 in 2026/27. That can be higher than an income-based amount. Unpaid amounts become arrears, Plan 2 interest goes to the highest rate (capped at 6%), and SLC can charge a penalty, demand the whole loan in one lump sum, and take court action. Student loans still do not appear on your credit report.
How are student loan repayments calculated when living overseas?
SLC converts your gross annual income into pounds at HMRC's annual average exchange rate, usually from your last three months' payslips, and subtracts your country's repayment threshold. You repay 9% of the remainder (6% for Postgraduate loans), split over 12 months and rounded down to whole pounds. For example, €33,000 in Spain converts to about £28,164, which gives £34 a month for Plan 2 in 2026/27.
What exchange rate does SLC use for overseas repayments?
SLC converts your income into pounds using the average exchange rate for the most recent calendar year published by HMRC, reviewed every 6 April; it does not track month-to-month movements. For 2026/27, 1 Australian dollar is £0.489572, 1 euro is £0.853461 and 1 US dollar is £0.760109. You then repay in pounds sterling and bear any currency-conversion and bank-transfer fees yourself.
Do the overseas thresholds apply to Plan 5 and Postgraduate loans?
Yes. SLC publishes a separate overseas table for every plan, and each uses the same country bands. For 2026/27, Spain's threshold is £20,000 for Plan 5 and £16,800 for a Postgraduate loan, against £25,000 and £21,000 in the UK; the United States is £30,000 and £25,200. You repay 9% above the Plan 5 threshold and 6% above the Postgraduate one, both at once if you hold both loans.
Do I have to repay my student loan if I'm travelling or not working abroad?
You still have to tell SLC before you leave if you will be away for more than 3 months, even if you are not earning. Update your employment details online, where you can record that you are unemployed, and give proof such as a recent bank statement. If your income is below your country's threshold, SLC defers repayments for 12 months. If you say nothing, your country's fixed monthly repayment applies instead.
Does moving abroad affect my credit score?
No. GOV.UK states that student loans do not appear on credit reports and do not affect your credit score, and moving abroad does not change that. The consequences of ignoring SLC are different: arrears on your loan account, the highest interest rate, a penalty charge and, in the end, a court order. Only a court judgment could reach your credit file. Lenders may still consider your student loan in affordability checks for other borrowing.
What happens to my student loan if I emigrate from the UK?
Your loan remains active regardless of where you live. Before you leave, tell the Student Loans Company and update your employment details; SLC then sets a repayment schedule from your country's threshold for up to 12 months at a time, reassessed each year. The write-off date stays the same, because emigrating does not reset or extend it, although write-off may not apply if you are in breach of your repayment obligations.
What happens to my student loan when I come back to the UK?
Update your employment details as soon as you return after more than 3 months away. If you do not, SLC keeps charging you at the rate for the country you left, possibly at a higher interest rate, while PAYE deductions restart once you are employed. PAYE repayments do not clear any overseas arrears; arrange those separately with SLC's arrears line on +44 141 243 3970. Visits under 3 months do not change your status.
Can I avoid paying my student loan by moving abroad?
No. SLC can recover the debt through the courts as a civil debt, in the UK or abroad, and can add the cost of tracing your address and income to your loan. If you do not respond to income requests, SLC charges your country's fixed monthly repayment (from £81.80 to £572.60 a month for Plan 2 in 2026/27), applies the highest interest rate to a Plan 2 loan, and can demand the whole loan in one lump sum.
Key takeaways
- Moving abroad does not cancel or pause your student loan. Write-off still comes only at the end of your plan’s term, and may not apply if you’re in breach.
- Tell SLC before you leave for more than 3 months, and update your employment details every year, even if you’re not earning.
- Your threshold depends on your country: 7 bands from 0.2× to 1.4× the UK figure, reset every 6 April.
- If you don’t update your details, SLC charges your country’s fixed monthly repayment, applies the highest interest rate to a Plan 2 loan, and can demand the whole loan.
- Student loans don’t appear on credit reports or affect your credit score, abroad or at home.
- Before you move, check your remaining balance and repayment timeline with the repayment calculator.