What Is a Plan 1 Student Loan?
Plan 1 is the oldest UK student loan type still being repaid. It covers English and Welsh students who started before September 2012, and every Northern Irish student regardless of start year. You repay 9% of everything you earn above £26,892 a year, and any balance left after 25 years is written off.
Plan 1 at a Glance
- Who
- England, Wales & N. Ireland
- Pre-2012 (all years for NI)
- Repayment threshold
- £26,892/yr
- £2,241/mo
- Repayment rate
- 9%
- of income above threshold
- Interest
- Lower of RPI or base rate + 1%
- 3.2% now
- Written off after
- 25 years
What Plan 1 means
A Plan 1 student loan is repaid at 9% of your income above the £26,892-a-year (£2,241 a month) repayment threshold. It has the lowest interest of any plan because the rate is capped at the lower of RPI or the Bank of England base rate plus 1%.
Because Plan 1 is the oldest plan, many borrowers are now well into their 25-year term. Any remaining balance is cancelled once that write-off period is reached, with nothing left to pay.
Who is on Plan 1?
You are on Plan 1 if you are an English or Welsh student who started an undergraduate course before September 2012.
You are also on Plan 1 if you are a Northern Irish student, whenever you started — Northern Ireland kept Plan 1 rather than moving to Plan 2 or Plan 5.
Not sure this is you? Take the 3-question which plan quiz to confirm.
Plan 1 interest rate
Plan 1 interest is charged at the lower of RPI (3.2%) or the Bank of England base rate plus 1% (4.75%). Right now that works out at 3.2%.
This cap keeps Plan 1 interest low and predictable — it never runs away the way a purely inflation-linked rate can, which makes Plan 1 the cheapest plan to carry pound for pound.
For a full walkthrough of how student loan interest compounds, read how student loan interest works.
How Plan 1 compares to other plans
Plan 1 has a lower threshold than Plan 2 (£29,376) or Plan 4 (£33,792), so you start repaying earlier, but its capped interest and shorter 25-year write-off make it far cheaper over a lifetime than the newer 40-year Plan 5.
| Plan | Who & when | Threshold | Rate | Interest | Write-off |
|---|---|---|---|---|---|
| Plan 1 | England, Wales & N. IrelandPre-2012 (all years for NI) | £26,892 | 9% | Lower of RPI or base rate + 1%3.2% now | 25 yrs |
| Plan 2 | England & Wales2012-2023 | £29,376 | 9% | RPI to RPI + 3% (income-based)3.2%–6.2% now | 30 yrs |
| Plan 4 | ScotlandAll years | £33,792 | 9% | Lower of RPI or base rate + 1%3.2% now | 30 yrs |
| Plan 5 | England2023+ | £24,996 | 9% | RPI only3.2% now | 40 yrs |
| Postgraduate Loan | UK-wideAll years | £21,000 | 6% | RPI + 3%6.2% now | 30 yrs |
See the full breakdown on the UK student loan plans hub.
Why middle earners feel Plan 1 the most
Plan 1's low, capped interest means the balance rarely balloons, so the middle-earner trap that hits Plan 2 and Plan 5 borrowers is much weaker here. The people most likely to clear a Plan 1 loan in full are steady middle earners — low earners often reach the 25-year write-off first, while high earners clear it quickly. Model your own salary to see where you land.
Middle earners repay the most across every UK plan — enough to make real repayments, but not enough to clear the balance before interest bites. Put your own salary into the student loan repayment calculator to see exactly where you fall.
Plan 1 FAQs
- What is a Plan 1 student loan?
- Plan 1 is a UK undergraduate loan for English and Welsh students who started before September 2012, and for all Northern Irish students. You repay 9% of income above £26,892 a year, interest is capped at the lower of RPI or base rate + 1% (currently 3.2%), and any balance is written off after 25 years.
- What is the Plan 1 repayment threshold?
- The Plan 1 threshold is £26,892 a year (£2,241 a month). You repay 9% of everything you earn above it, so on Plan 1 someone earning below £26,892 makes no repayments at all.
- What is the Plan 1 interest rate?
- Plan 1 interest is the lower of RPI (3.2%) or the Bank of England base rate plus 1% (4.75%), which currently means 3.2%. It is the lowest interest rate of any UK student loan plan.
- When is a Plan 1 loan written off?
- A Plan 1 loan is written off 25 years after the April you were first due to repay. Anything still outstanding at that point is cancelled and you stop paying.