PGL mechanics (2026/27)
- Threshold: £21,000 per year
- Rate above threshold: 6%
- Calculation: per pay period through PAYE
Monthly threshold: £21,000 / 12 = £1,750 Weekly threshold: £21,000 / 52 = £403.85
PGL runs in parallel to any undergraduate plan. They don't combine into one deduction — each is calculated independently and both appear on your payslip.
Who has PGL
PGL applies to:
- English or Welsh students who took out a UK Postgraduate Loan for master's or PhD study from 2016 onwards
- A separate Postgraduate Doctoral Loan for PhD students starting from 2018 also goes through this PAYE channel
Scottish postgraduate funding is separate (typically via SAAS) and doesn't create a UK PGL. Northern Irish postgrads similarly use different schemes.
Worked example — PGL only on £30,000
Annual: - Above £21,000 = £9,000 - 6% × £9,000 = £540/year
Monthly: £45. Standalone PGL is meaningful but not as large as a typical Plan 2 deduction at the same salary.
Worked example — PGL + Plan 2 on £40,000
Plan 2: - Above £28,470 = £11,530 × 9% = £1,038/year
PGL: - Above £21,000 = £19,000 × 6% = £1,140/year
Combined annual student loan deduction: £2,178
That's 5.4% of gross — a substantial slice of net pay for postgraduate-qualified workers.
Worked example — PGL + Plan 5 on £50,000
Plan 5: - Above £25,000 = £25,000 × 9% = £2,250/year
PGL: - Above £21,000 = £29,000 × 6% = £1,740/year
Combined annual: £3,990 — 8% of gross.
Combined rate breakdown by income band
| Income range | Marginal student loan rate |
|---|---|
| Below £21,000 | 0% (below all thresholds) |
| £21,000 – undergrad threshold | 6% (PGL only) |
| Above both thresholds | 15% (9% undergrad + 6% PGL) |
For someone earning above their plan threshold, the combined 15% is added on top of Income Tax + NI. At higher-rate (40% + 2% NI = 42%), total marginal rate becomes 42% + 15% = 57% on income above the higher-rate threshold.
PGL interest
PGL interest tracks the same RPI-linked formula used for the corresponding undergrad plan in your year of issuance:
- 2016–2023 PGLs: RPI + 3% during study, RPI + variable margin during repayment
- Post-2023 PGLs: RPI only
The interest accrues daily and is added to your balance. The deduction stays at 6% above £21,000 regardless of interest accumulated.
When PGL writes off
30 years from the April you first became repayable.
For a 2018 PGL recipient who graduated in 2019 and first became repayable in April 2020, write-off is April 2050.
After write-off, any remaining PGL balance is forgiven with no penalty. This is the same rule as Plan 2.
The PGL salary-sacrifice optimisation
PGL threshold is the lowest of any UK student loan, so pension sacrifice has limited room to eliminate PGL entirely (you'd need to sacrifice below £21,000 of threshold-relevant income, which leaves little).
But sacrifice still reduces the deduction proportionally. For someone on £25,000 with PGL only:
Without sacrifice: - Above £21,000 = £4,000 × 6% = £240/year PGL
With 8% sacrifice (£2,000): - Threshold-relevant income: £23,000 - Above £21,000 = £2,000 × 6% = £120/year PGL - £120 saving on student loan plus Income Tax + NI saved
The maths is similar for combined PGL + undergrad: each sacrifice pound reduces both deductions proportionally.
Verifying PGL on payslips
Your payslip should show student loan deductions clearly. Typical formats:
- Plan + PGL combined: a single "Student Loan" line representing both, OR
- Separate lines: "SL Plan 2" + "SL PGL" if your payroll is more detailed
If you have PGL but it doesn't appear, raise it with your employer — payroll may not have been notified. Conversely, if PGL appears but you don't have one, raise it with your employer and Student Loans Company.
Self-employment
For self-employed PGL borrowers, repayment is calculated through Self Assessment based on annual self-employment income (and other income). The threshold and 6% rate apply identically; the mechanism is annual rather than per-pay-period.
In short
UK Postgraduate Loan repays at 6% above £21,000 (2026/27), per pay period via PAYE. Runs in parallel to any undergraduate plan. 30-year write-off. Combined rate with Plan 2 or Plan 5 is 15% on income above both thresholds. Use the take-home calculator → to model. For the full reference, see the student loans hub →.