A postgraduate loan from Student Finance England is either a Master's Loan of up to £13,206 or a Doctoral Loan of up to £31,122 for courses starting on or after 1 August 2026. It is paid to the student, not the university, and can be spent on fees or living costs. Repayment is 6% of income above £21,000 a year, starting the April after you leave the course. It runs on top of any undergraduate loan repayments. Interest is RPI plus 3%, capped at 6% from 1 September 2026 to 31 August 2027. Any balance left after 30 years is written off.
How much you can borrow
| Course start | Master's Loan | Doctoral Loan |
|---|---|---|
| On or after 1 August 2026 | £13,206 | £31,122 |
| 1 August 2025 to 31 July 2026 | £12,858 | £30,301 |
| 1 August 2024 to 31 July 2025 | £12,471 | £29,390 |
The amount is not means-tested, so neither your income nor your family's affects it. On a course lasting more than a year, the loan is split equally across the years. It is paid in three instalments of 33%, 33% and 34% each year, once the university confirms registration. The Master's Loan maximum of £13,206 is set by regulation 12 of the Education (Postgraduate Master's Degree Loans) Regulations 2016. The DWP may take the loan into account for means-tested benefits.
The loan rarely covers everything. A master's with fees of £12,000 leaves little for rent, so most students combine it with savings, employer sponsorship or part-time work.
Who qualifies
The main conditions for a Master's Loan are:
- Age. Under 60 on the first day of the first academic year of the course;
- Course. A full, standalone master's of at least 180 credits that started on or after 1 August 2016. It can be taught or research-based, full-time over 1 or 2 years or part-time over 2 to 4 years. Postgraduate certificates and diplomas do not qualify;
- Prior study. You must not already hold a master's degree or a higher qualification. A PGCE or a postgraduate diploma does not count against you;
- Residence. Normally living in England, with 3 years' residence in the UK, Channel Islands or Isle of Man before the course, and a qualifying immigration status;
- Repayment record. You must not be behind on repayments of any earlier Student Loans Company loan.
The Doctoral Loan is for a full, standalone doctorate (PhD, EdD, EngD and similar) that lasts 3 to 8 academic years at a UK university with research degree awarding powers. It is not available if you receive Research Council funding or are eligible for an NHS bursary. The same under-60 age rule applies. Students from Wales, Scotland and Northern Ireland apply to their own funding bodies under different rules.
How repayment works
Repayment begins the April after you leave or finish the course. For part-time courses longer than 4 years that start before 1 January 2027, it begins in the April 4 years after the course started. You then repay 6% of income above £21,000, which is £1,750 a month or £403.84 a week in payroll. In the repayment regulations the postgraduate loan is called a "plan 3 loan", and its £21,000 threshold is written into Schedule 1A as a fixed figure. Unlike the undergraduate thresholds, it is not uprated each year.
The key point is that a postgraduate loan is not merged with an undergraduate loan. A graduate with both pays 6% above £21,000 and 9% above their undergraduate threshold at the same time.
Worked examples
Postgraduate Loan only, £35,000 salary. 6% × (£35,000 − £21,000) = £840 a year, or £70 a month.
Plan 2 and Postgraduate Loan, £35,000 salary. As above, £840 for the Postgraduate Loan, plus 9% × (£35,000 − £29,385) = £505.35 for Plan 2. That makes about £1,345 a year. On every pound earned above £29,385, the two loans together take 15%. For a basic rate taxpayer in England or Northern Ireland, adding 20% income tax and 8% employee National Insurance gives a marginal deduction rate of 43% in this band. Payroll works out student loan deductions on the same gross pay used for employer National Insurance, so anything that lowers that figure lowers the deduction too. That matters when comparing a pay rise with a salary sacrifice arrangement.
Self-employed graduate. HMRC calculates the 6% through Self Assessment on total income for the year. It is collected in the balancing payment due by 31 January after the end of the tax year.
Interest, overpayments and write-off
Interest runs from the day of the first payment. The rate is RPI plus 3%, which for 1 September 2026 to 31 August 2027 would be 7.1%. A cap holds it at 6% for that period. Because interest is charged at the same rate before and after study, the balance on a Master's Loan often grows during the course and the first years of work, even while repayments are being made.
For students from England or Wales, any balance left 30 years after the April you were first due to repay is written off. The loan is also cancelled on death, and may be cancelled if you cannot work because of disability. You can make extra repayments at any time without penalty, but they cannot be refunded. Overpaying usually only makes financial sense if you expect to clear the loan before the 30-year write-off anyway.
What employers need to know
HMRC sends a PGL1 start notice when deductions should begin and a PGL2 stop notice when they should end. A new starter may also declare a postgraduate loan on the starter checklist. Postgraduate and undergraduate deductions are separate fields in payroll software and on the FPS and P60, in whole pounds. Where a court order and a protected earnings level both apply, HMRC guidance gives postgraduate loan deductions priority over student loan deductions. Records must be kept for at least 3 years after the end of the tax year.
Sources: Master's Loan, Doctoral Loan, Repaying your student loan, the 2026 interest rate announcement, Schedule 1A to the 2009 Repayment Regulations and regulation 12 of the 2016 Regulations. For the undergraduate plans, see our guide to student loan plans. For tax returns, see paying Self Assessment tax.
Acumon handles PGL1 and PGL2 notices within outsourced payroll, and calculates postgraduate loan liabilities for self-employed clients as part of Self Assessment.