First Job: Student Loans and Your Take-Home Pay

Before budgeting from a first salary offer, confirm your loan plan and whether repayments have started. Two people offered the same salary can receive different net pay because of their loan and pension settings. Your balance alone does not set the monthly deduction.

Confirm the plan and repayment start date

Use your student loan account or the official plan guidance. Your tax region does not select your loan plan: moving to Scotland, for example, does not automatically turn a Plan 2 loan into Plan 4. Plan 5 repayments cannot start before April 2026; course and leaving dates still determine your own start date.

Compare Plan 2 with Plan 5

Both examples use 2026/27 England/Wales/NI rates, a standard allowance, no pension and regular full-year earnings. The Plan 2 threshold is £29,385; Plan 5 is £25,000. The lower threshold produces a larger deduction at this salary. These are annual estimates, not exact payroll-month repayments.

Try the £35,000 Plan 2 example or open the same salary on Plan 5. Change the pension method and percentage to match the offer.

If you also have a postgraduate loan

A postgraduate loan has a separate 6% deduction above £21,000. Our £35,000 Plan 2 plus postgraduate example estimates £1,345.35 of total yearly repayments and £2,281.19 average monthly net pay. Open both loans together.

Multiple undergraduate plans do not mean multiple 9% deductions

For multiple undergraduate plans, the salary model uses one 9% repayment above the lowest applicable threshold. A postgraduate repayment remains separate. Select the plans you actually hold rather than checking every plan to be cautious.

Budget for your actual first payday

• Ask which dates the first payment covers and whether the first month is partial.
• Confirm the employee pension method, contribution percentage and earnings basis.
• Provide your P45 or starter checklist and the correct loan details.

Payroll uses pay-period thresholds and rounds loan deductions; bonuses can trigger a deduction in one month even where an annual estimate looks small. If deductions were taken before repayment was due, on the wrong plan or where annual income was below the relevant threshold, check the official loan-refund route after the year ends as applicable.

Use the payslip checklist on your first payday. This tool does not model loan balance exhaustion, interest, overseas repayments or the best strategy for voluntary repayment.

Sources and corrections

• Student loan repayment thresholds and deductions
• Which repayment plan applies
• When repayment starts
• Student loan refunds

These sources were checked for this guide on 8 October 2026. If you spot an error, send a correction with the page address and the official source.