What Is a Plan 5 Student Loan?
Plan 5 is the newest UK student loan, for English students who started university from September 2023 onwards. It has the lowest threshold of the current undergraduate plans — £24,996 a year — the simplest interest (RPI only), but the longest write-off of any plan at 40 years.
Plan 5 at a Glance
- Who
- England
- 2023+
- Repayment threshold
- £24,996/yr
- £2,083/mo
- Repayment rate
- 9%
- of income above threshold
- Interest
- RPI only
- 3.2% now
- Written off after
- 40 years
What Plan 5 means
A Plan 5 student loan is repaid at 9% of income above £24,996 a year (£2,083 a month). Interest is charged at RPI only — no income-based add-on — which makes the balance easier to predict than Plan 2.
The catch is the term: Plan 5 balances are written off 40 years after you become due to repay, ten years longer than Plan 2 and fifteen longer than Plan 1. That extra decade of repayments is where the real cost hides.
Who is on Plan 5?
You are on Plan 5 if you are an English student who started an undergraduate course on or after 1 August 2023.
Welsh, Scottish and Northern Irish students are not on Plan 5 — Plan 5 is England-only. Students who started before August 2023 remain on Plan 2 (or Plan 1).
Not sure this is you? Take the 3-question which plan quiz to confirm.
Plan 5 interest rate
Plan 5 interest is charged at RPI only — currently 3.2% — with no income-based addition. That makes it the simplest interest of any plan to understand and forecast.
Lower, simpler interest sounds cheaper, but the 40-year write-off means most borrowers keep repaying for far longer, so many end up paying more in total than they would have on the shorter Plan 2.
For a full walkthrough of how student loan interest compounds, read how student loan interest works.
How Plan 5 compares to other plans
Plan 5's £24,996 threshold is lower than Plan 2 (£29,376), so you start repaying sooner and pay more each month at the same salary. Its RPI-only interest is gentler than Plan 2's RPI + 3%, but the 40-year term (versus 30 for Plan 2) is longer than any other plan.
| 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 or read the in-depth Plan 2 vs Plan 5 comparison.
Why middle earners feel Plan 5 the most
Plan 5's 40-year term turns the middle-earner trap into a marathon. Lower earners can pay for four decades and still have a balance written off; high earners clear it early. Middle earners repay steadily for most of their working life — often paying back far more than they borrowed before the write-off ever arrives.
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 5 FAQs
- What is a Plan 5 student loan?
- Plan 5 is the newest UK student loan, for English students who started from September 2023. You repay 9% of income above £24,996 a year, interest is RPI only (currently 3.2%), and any balance is written off after 40 years — the longest term of any plan.
- What is the Plan 5 repayment threshold?
- The Plan 5 threshold is £24,996 a year (£2,083 a month), the lowest of the current undergraduate plans. You repay 9% of everything you earn above it, so repayments start at a lower salary than on Plan 2.
- What is the Plan 5 student loan interest rate?
- Plan 5 interest is charged at RPI only, currently 3.2%, with no income-based add-on. That is simpler and lower than Plan 2's RPI + 3% ceiling, but the 40-year write-off can make Plan 5 more expensive overall.
- When is a Plan 5 loan written off?
- A Plan 5 loan is written off 40 years after the April you were first due to repay — ten years longer than Plan 2 and fifteen longer than Plan 1. That long term is the main driver of Plan 5's lifetime cost.