- Plan 2 (2012-2023 starters): written off 30 years after first repayment due
- Plan 5 (Aug 2023+): written off after 40 years
- Plan 1 (pre-2012): written off at age 65 or after 25 years
- Write-off is automatic -- no application needed
- Written-off student debt is not taxable income in the UK
- IFS: only ~25% of Plan 2 graduates will repay in full before write-off
TL;DR: Student loan write-off: the four plans UK student loans are not conventional debts. They do not appear on credit files, cannot be pursued by debt collectors, and are cancelled automatically after a set number of years regardless of the outstanding balance. The write-off period a
Student loan write-off: the four plans
UK student loans are not conventional debts. They do not appear on credit files, cannot be pursued by debt collectors, and are cancelled automatically after a set number of years regardless of the outstanding balance. The write-off period and repayment rules depend on which plan the borrower is on, determined by when and where they studied.
Plan 1: pre-September 2012 borrowers
Plan 1 covers students who started undergraduate study in England or Wales before 1 September 2012, and Scottish and Northern Irish students who started before 1 September 1998. The repayment threshold is £24,990 per year (2024/25). Repayments are 9% of income above the threshold, collected via PAYE.
Write-off: the loan is cancelled at age 65, or 25 years after the first April repayments were due, whichever comes first. For a student whose repayments began April 2011, write-off falls in April 2036 under the 25-year rule.
Plan 2: September 2012 to July 2023 borrowers
Plan 2 is the most common plan for current UK graduates. It covers English and Welsh students who started undergraduate study between 1 September 2012 and 31 July 2023. The repayment threshold is £27,295 per year (2024/25). Repayments are 9% of income above the threshold.
Write-off: 30 years after the first April repayments were due. A 2023 graduate whose repayments begin April 2024 reaches write-off in April 2054. The Institute for Fiscal Studies estimates that only around 25% of Plan 2 borrowers will fully repay before write-off -- for the majority, the loan functions economically more like a graduate tax than a conventional debt.
Interest on Plan 2 loans is linked to RPI. During study the maximum rate is RPI plus 3%. After graduation the rate varies between RPI and RPI plus 3% depending on income level.
Plan 4: Scottish students
Plan 4 covers Scottish students whose loans are administered by SAAS. The repayment threshold is £31,395 per year (2024/25) -- the highest of any UK plan. Repayments are 9% above the threshold. Write-off occurs at age 65 or 30 years after repayments were first due, whichever comes first.
Plan 5: from August 2023 in England
Plan 5 was introduced for English students starting undergraduate study from 1 August 2023 onwards. The repayment threshold starts at £25,000 per year, rising with average earnings from 2025. Repayments are 9% above the threshold. Interest is capped at RPI only -- lower than Plan 2's maximum of RPI plus 3%.
The critical difference from Plan 2 is the write-off period: 40 years rather than 30. A student starting in September 2023, graduating 2026, with repayments beginning April 2027 reaches write-off in April 2067. The longer period means lower-earning graduates face four decades of income-contingent payments. The IFS projects that under Plan 5 a higher proportion of graduates repay more over their lifetime compared to Plan 2, particularly those on middling earnings.
Postgraduate loans
Postgraduate Master's and Doctoral loans operate separately from undergraduate loans. The repayment threshold is £21,000 per year and the rate is 6% above the threshold -- collected simultaneously alongside any undergraduate loan repayments if both thresholds are met. Postgraduate loans are written off after 30 years.
What write-off means in practice
When a loan is written off the Student Loans Company cancels the remaining balance. In the UK this is not a taxable event -- the cancelled amount does not count as income for tax purposes. Write-off is automatic; borrowers do not need to apply. Written-off student debt does not affect credit scores, mortgage applications or employment checks at any point.
Is early repayment ever worthwhile?
For most graduates on median UK earnings, voluntary early repayment is not financially rational. The loan carries below-market interest, repayments are income-contingent and the balance disappears at write-off. A graduate who would not have repaid in full before write-off anyway receives no benefit from early repayment -- they simply hand over money they would never have been required to repay. Early repayment may make sense for high earners on a clear trajectory to full repayment well before write-off, particularly on Plan 2 where interest is higher. A financial adviser can model individual scenarios. For most graduates, prioritising pension contributions and mortgage overpayments is likely more financially efficient.
Death and permanent disability
Student loans are written off on the death of the borrower. The debt does not pass to the estate or family. Proof of death must be provided to the Student Loans Company by the next of kin. Loans are also written off in cases of permanent disability where the borrower is assessed as permanently unfit for work, subject to a formal application and medical evidence.
Frequently asked questions
Can the government change the write-off period for existing borrowers?
Parliament can legislate changes to student loan terms. The 2012 reforms extended the write-off from 25 to 30 years for new borrowers; the 2023 reforms introduced 40 years for Plan 5. Retrospective changes to existing loans require primary legislation and have been politically controversial. Changes have generally applied to new borrowers only, not retrospectively to existing loans.
Does the write-off countdown pause if a borrower lives abroad?
No. The countdown continues regardless of where the borrower lives. Overseas borrowers must report income annually to the Student Loans Company and make repayments if income exceeds the relevant threshold converted to local currency.
Is written-off student debt taxable?
No. In the UK, student loan write-off does not create a tax liability. The cancelled balance is not treated as income for income tax or National Insurance purposes.
What plan applies if I started in 2022?
Students who started undergraduate study in England between September 2012 and July 2023 are on Plan 2, with a 30-year write-off. Plan 5 with its 40-year period applies only to students who started from August 2023 onwards.
