Student loan repayments when you're self-employed
When you're self-employed, nobody takes student loan repayments from your pay. They're worked out on your tax return and added to your January bill. Here's how it works for 2025/26.
Checked against GOV.UK on 23 October 2026. General information for sole traders in England, Wales and Northern Ireland, not tax advice. Scottish Income Tax rates are different.
How it works
You repay a percentage of income over your plan's threshold: 9% for Plans 1, 2, 4 and 5, and 6% for a Postgraduate Loan. If you're self-employed, it's worked out through Self Assessment and added to the balancing payment due on 31 January. It isn't included in payments on account.
Thresholds for 2025/26
| Plan | Yearly threshold | Rate |
|---|---|---|
| Plan 1 | £26,065 | 9% |
| Plan 2 | £28,470 | 9% |
| Plan 4 (Scotland) | £32,745 | 9% |
| Postgraduate Loan | £21,000 | 6% |
Source: GOV.UK rates and thresholds for 2025 to 2026. Thresholds change each year, so use the right year's figures.
Worked example
Amy is on Plan 2 with £30,000 of self-employed profit and no other income in 2025/26: (£30,000 − £28,470) × 9% = £137.70, added to her January 2027 bill. With a Postgraduate Loan as well: (£30,000 − £21,000) × 6% = £540.00 more.
Tips
- Answer the student loan question on your return. If you miss it, you'll need to amend the return.
- If you also had a job, repayments already taken through payroll are taken into account.
The January tax bill calculator doesn't include student loans, so add this to its balancing payment. See also your first tax bill.
This guide is part of our Self Assessment guides for the self-employed.
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Frequently asked questions
How do self-employed people repay student loans?
Through Self Assessment. It's worked out on your return and added to the 31 January balancing payment.
What's the Plan 2 threshold for 2025/26?
£28,470 a year. You repay 9% of income above it.
Are student loans included in payments on account?
No, they're paid with the balancing payment.
Sources
- Rates and thresholds for employers 2025 to 2026 – GOV.UK
- Repaying your student loan: what you pay – GOV.UK
- Understand your Self Assessment tax bill: payments on account – GOV.UK
This guide is general information, not legal, tax or financial advice. Rules and rates change, so check the linked GOV.UK pages for the current position.