Plan 5 is the newest UK student loan plan, and for the first two years after its launch it existed mostly on paper, since almost nobody covered by it had actually started repaying yet. That changed properly this year. Most of the first full Plan 5 cohort, students who started standard three-year courses in September 2023, began repaying in April 2027, following a smaller wave of early leavers and short-course graduates whose repayments started as early as April 2026. If you're wondering whether you're on it, what it actually costs compared to the older system, or when your own repayments begin, here's the whole picture.
To see exactly what Plan 5 means for your own numbers, our student loan calculator models Plan 5 repayment year by year against your actual salary.
Who's Actually on Plan 5
You're on Plan 5 if Student Finance England funded your undergraduate course, PGCE, or Advanced Learner Loan, and it started on or after 1 August 2023. It's an England-only plan. Equivalent students in Wales stayed on Plan 2, Scotland continues to use Plan 4 through SAAS, and Northern Ireland uses Plan 1, differences we cover in full in our comparison of student finance across all four UK nations. Postgraduate Master's and Doctoral loans sit outside this system entirely, as a separate Postgraduate Loan, whichever undergraduate plan you're also on.
Started your course in England before August 2023? You're on Plan 2, and Plan 5 has no effect on you at all. This dividing line by start date, not by when you graduate, is where a lot of confusion comes from, since two people finishing the same course in the same year can be on entirely different plans if one started a few weeks earlier.
Plan 5 vs Plan 2 at a Glance
| Plan 5 | Plan 2 | |
|---|---|---|
| Who's on it | England, started Aug 2023+ | England & Wales, 2012 to July 2023 |
| Repayment threshold | £25,000 | £29,385 |
| Interest rate | 4.1% (RPI only) | Up to 6%, capped |
| Write-off period | 40 years | 30 years |
| Expected to repay in full | 56% forecast | Roughly a quarter, estimated |
Every individual figure in that table looks like it favours Plan 5: a lower interest rate and a much longer write-off period both help the borrower, in isolation. The threshold is the one number working the other way, and it's the one that ends up dominating, because it determines how much of your income the 9% rate actually applies to, every single month, for potentially decades.
When Your Repayments Actually Start
The general rule matches every other plan: repayments begin the April after you finish or leave your course, once your income clears the threshold. Plan 5 adds one specific rule on top that doesn't apply elsewhere: repayments never start before April 2026, regardless of when you actually left. This is why short courses and early leavers from the first Plan 5 cohort saw deductions begin as early as this point, even though a strict "April after leaving" reading might have started them sooner.
Started repaying too early? You're entitled to a refund. If deductions began before the April after you left your course, or before April 2026 if that's later, the Student Loans Company will refund you once your plan type has been corrected.
For part-time students or anyone on a Postgraduate Doctoral course running longer than four years, the same general principle applies with one variation: repayments start the April after you finish, or the April four years after your course began, whichever comes first.
Why the Reform Exists
The lower threshold and longer term aren't incidental. Under Plan 2, government forecasting has consistently found that a large share of borrowers never clear their balance before write-off, meaning the state effectively absorbs a substantial portion of what was borrowed. Plan 5 was designed specifically to change that ratio: a lower threshold means more of a graduate's income is captured by the 9% rate sooner, and a 40-year term gives that lower, RPI-only interest rate far more time to be outpaced by repayments rather than compounding faster than they can be cleared.
The Department for Education's own forecast for the most recent cohort puts 56% of Plan 5 borrowers on track to repay in full, against roughly a quarter under Plan 2, based on independent modelling of the earlier system. That's the reform working as intended from the government's perspective. From a graduate's perspective, it means the loan functions much more like a real loan you'll actually pay back, and much less like the income-linked graduate tax Plan 2 increasingly resembles for a majority of its borrowers. For the full mechanics of what write-off means and when it applies, see our guide on when a student loan gets written off.
Same Salary, Two Very Different Outcomes
Same balance, same salary, same growth assumption, and the two outcomes barely resemble each other. The Plan 5 borrower pays roughly eight times as much per year to start with, because £25,000 rather than £29,385 leaves more of their salary exposed to the 9% rate, and that gap compounds every year their income grows. Over the full term, they repay well over double the Plan 2 amount and clear almost the entire balance rather than having most of it cancelled. Neither outcome is a mistake or a malfunction. This is precisely what each plan was built to do.