CSLM10111 | FAQs: employers questions and answers: how much do I deduct?

If you have received a start notice and your employees earnings are over the threshold, you should start making student loan deductions.

Employees repay 9% of the amount they earn over the threshold for Plan 1, 2, 4 and 5 loans and 6% of the amount they earn over the threshold for postgraduate loan.

The deductions are non-cumulative and calculated on the same gross pay amount for the current pay period that you would use to work out your employee’s secondary Class 1 National Insurance contributions.

Your payroll software should take account of this and calculate the student loan deduction for you.

You can find more information about deducting student loans on gov.uk.