Student Loan threshold changes from April 2018

08 October 2017

Further to the previous notification of a threshold change for Student Loan borrowers, HMRC has confirmed that the Plan 2 repayment threshold will rise from £21,000 to £25,000 from 6 April 2018.

The following update was provided by HMRC Student Loans specialists to the Software Developers Support Team:


Notification of a threshold change for student loan borrowers in the current Income Contingent Repayment (ICR) scheme.

The current threshold for 2017-18 for Plan 1 is £17,775 and for Plan 2 is £21,000 and the Department for Education have confirmed that from 6 April 2018 the threshold for

  • Plan 1 loans will rise to £18,330

  • Plan 2 loans will rise to £25,000

This figure will apply to all current and future borrowers for whom employers make Student Loan deductions.

Software developers are being notified as early as possible in order that software changes can be made ready for implementation on 6 April 2018.”

The £21,000 repayment threshold for Plan 2 student loans was to be fixed until 2021. The threshold change comes after the Prime Minister announced at the recent Conservative party conference, changes to the student finance system, widely seen as an attempt to attract young voters. According to BBC News more changes may be on the way as the government says it is looking at the entire student finance system over the coming months.