Student Loan Plan 4
The repayment plan for Scottish students who took out their first student loan on or after 1 September 1998 under the Student Awards Agency for Scotland. Repayments are 9% of income above the Plan 4 threshold (£33,795 for 2026/27), which is the highest of all undergraduate plans. The loan is written off after 30 years or when the borrower reaches the age of 65, whichever comes first.
How it works
Plan 4 covers Scottish students whose loans are administered by the Student Awards Agency for Scotland (SAAS) rather than the England/Wales system, and it applies to loans first taken out on or after 1 September 1998. It carries the highest repayment threshold of the undergraduate plans, reflecting separate Scottish policy decisions on loan design.
If you studied in Scotland but later move to live and work elsewhere in the UK, you remain on Plan 4 — the plan is determined by where your loan was issued, not where you currently live or work. Your employer identifies the correct plan from the student loan start notice HMRC sends them, or from your new starter checklist when you begin a job.
Because the threshold is set higher than Plan 1, Plan 2, or Plan 5, a Scottish graduate earning the same salary as an English graduate on Plan 2 will generally make a smaller student loan repayment, even though both are charged at the same 9% rate above their respective thresholds.
Example: Plan 4 repayment on a £40,795 salary
The Plan 4 threshold for 2026/27 is £33,795. A salary of £40,795 sits £7,000 above that threshold, giving a repayment of £7,000 × 9% = £630 for the year, or £52.50 a month through PAYE.
Compare this to a Plan 2 borrower on the same £40,795 salary, whose threshold of £29,385 leaves £11,410 exposed to the 9% rate — a repayment of £1,026.90, considerably more than the Plan 4 borrower despite identical pay.
Frequently asked questions
Is Plan 4 only for people who currently live in Scotland?
No — Plan 4 status follows the loan, not your current address, so a Scottish-domiciled borrower who moves to England, Wales, or Northern Ireland for work stays on Plan 4 for the life of that loan.
Why does Plan 4 have a higher threshold than Plan 2?
The two plans were set independently by different administrations — SAAS for Scotland and the England/Wales system — and the Plan 4 threshold has been uprated to a higher level, so the same salary produces a smaller Plan 4 repayment.
When is a Plan 4 loan written off?
Plan 4 balances are written off after 30 years or when the borrower turns 65, whichever comes first, matching the write-off rule used for Plan 1.
Related Terms
Student Loan Plan 1
The earliest student loan repayment plan, applicable to UK students who took out their first loan before 1 September 2012.
Student Loan Plan 2
The repayment plan for students who started an undergraduate course in England or Wales from 1 September 2012 onwards.
Student Loan Plan 5
The newest undergraduate repayment plan, applying to students starting courses in England from 1 August 2023 onwards.
Postgraduate Loan
A student loan available to UK residents studying a postgraduate master's or doctoral course, repaid through payroll deductions at 6% of income above the postgraduate repayment threshold (£21,000 per year).
Repayment Threshold
The level of annual income above which you must start making student loan repayments, which differs depending on your loan plan.
SLC
The Student Loans Company — the government-owned company that administers student loans in the UK, including issuing funds to students, collecting repayments through payroll (via HMRC), and managing loan balances.
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