Why is my student loan deduction so high in my bonus month?

PAYE calculates student loan deductions based on your earnings in that specific pay period, not your annual income. When you receive a bonus, your total income for that month exceeds the monthly threshold (£2,448 for Plan 2 in 2026-27), triggering 9% deductions on everything above the threshold. For example, if your regular salary is £2,000 plus a £10,000 bonus in December, your total income that month is £12,000. The deduction would be 9% of (£12,000 - £2,448) = £859.68, even though most months you pay nothing.

Can I get a refund if my bonus causes overpayment?

Yes, you can claim a refund if your total annual income is below the yearly threshold but bonuses triggered monthly repayments. For Plan 2, if your annual income is below the 2026-27 threshold of £29,385 but you paid student loan deductions during high-earning months (bonuses, overtime, commission), you're entitled to a full refund of those deductions. You must wait until after the tax year ends (after 5 April) and then contact the Student Loans Company with evidence like your P60 showing annual earnings below the threshold.

How much student loan will I pay on a £15,000 bonus?

On a £15,000 bonus payment, assuming you're already earning above the monthly threshold, you'll pay approximately 9% of the entire bonus amount for undergraduate loans (Plan 1, 2, 4, or 5). That's around £1,350 in student loan deductions. If you also have a Postgraduate Loan, you'll pay an additional 6% (£900), totaling £2,250 in student loan deductions that month. This deduction applies regardless of your usual monthly salary because PAYE treats each pay period independently.

Does my employer calculate bonuses differently for student loans?

No, employers must apply the same monthly threshold calculation to all earnings in a pay period, including bonuses. There's no special treatment or averaging for one-off payments. Your employer adds the bonus to your regular salary for that month and applies 9% (or 15% if you have both undergraduate and postgraduate loans) to everything above the monthly threshold. This is why even annual bonuses paid once per year can result in substantial one-time student loan deductions of £2,000-£3,000.

Should I ask my employer to split my bonus across multiple months?

Splitting your bonus across multiple months won't reduce your total student loan repayments if your annual income exceeds the yearly threshold. However, if your annual income is below the threshold and you'd rather claim a refund later than have a large deduction upfront, receiving the bonus in one month may be preferable for cash flow. If your annual income exceeds the threshold, you'll owe the same total amount whether the bonus is paid in one month or split across several - the monthly threshold calculation ensures 9% is paid on income above threshold regardless of payment timing.

Bonus Month PAYE Student Loan Calculator

Check one bonus-month payslip. Enter the month's gross pay and bonus and see the income tax, National Insurance and student loan that should have come off it, using HMRC's 2026-27 thresholds.

Want the full picture instead of one payslip?

This page works out a single month in isolation. The bonus & variable pay calculator is the fuller tool: it runs true cumulative PAYE across the whole tax year, so it shows what the bonus really costs you once the tax settles, and lets you choose which tax month it is paid in.

One payslip at a time

Student loan deductions are worked out on the pay for that period alone, which is why a bonus month looks so different from every other month.

Regular monthly gross pay

Annual equivalent: £42,000

Bonus paid this month (gross)

Gross pay for the month: £8,500

Tax code

Tax-free pay this month: £964.17

Scottish taxpayer

England, Wales and Northern Ireland rates apply.

Student loan plan

9% of everything above £2,448 a month

I also have a Postgraduate Loan

Correct, not an overpayment

£450 of the £5,000 bonus goes to your student loan this month, and £544 comes off the payslip in total.

Your student loan deduction is set by that month's pay alone. A higher deduction in a bonus month is the rule working normally, not an error.

Your bonus month payslip, 2026-27

Student loan this month

£544

vs £94 in a normal month

Income tax this month

£2,386.00

England, Wales and NI rates

National Insurance

£337.50

8% to £4,189 a month, then 2%

Net pay

£5,232.50

61.6% of gross

(£8,500 − £2,448) × 9% = £544

Plan 2, HMRC's monthly threshold of £2,448 for 2026-27, rounded down to a whole pound the way payroll does. HMRC publishes and floors this figure; it is not the annual threshold divided by twelve^[source].

£8,500 − £2,386.00 − £337.50 − £544 = £5,232.50

Gross pay for the month, less income tax, National Insurance and student loan.

Normal month and bonus month payslip compared, 2026-27
Line	Normal month	Bonus month	Difference
Gross pay	£3,500	£8,500	£5,000
Income tax	£490.50	£2,386.00	£1,895.50
National Insurance	£196.16	£337.50	£141.34
Student loan	£94	£544	£450
Net pay	£2,719.34	£5,232.50	£2,513.16

One payslip is not the whole story.

The income tax figure above treats this month on its own. Real PAYE is cumulative, so some of the tax taken in a bonus month comes back over the following months — the earlier in the tax year the bonus falls, the more of it does. For the true cost of the bonus across the year, use the bonus & variable pay calculator. The student loan figure needs no such adjustment: it is final for the period and never recalculated.

Rates, assumptions and sources

Last reviewed: 5 October 2026 · Verified against gov.uk and SLC published figures

Every figure below is the 2026-27 published figure, read from this site's single source of truth at page-render time^[source]. The 6% Plan 2 and Postgraduate interest cap covers the 2026/27 year only and is not assumed to continue^[source].

Repayment threshold, rate, interest, write-off period and threshold freeze status by student loan plan, 2026-27
Plan	Threshold	Rate	Interest	Written off	Threshold freeze
Plan 2	£29,385^[source]	9%	4.1% to 7.1% by income, capped at 6% for 2026-27^[source]	30 years^[source]	Frozen at £29,385 until April 2030

Write-off is counted from the April after the course ends, not from the course-end date itself, and the Plan 2 interest bands (£29,385 lower, £52,885 upper) are frozen alongside the Plan 2 repayment threshold.

This calculator also assumes

Tax year: 2026-27
Pay frequency: Monthly (12 periods a year)
Income tax basis: This month alone (Month 1 basis)
Tax code: 1257L
Income tax rates: England, Wales and Northern Ireland
National Insurance: Employee Class 1, per pay period
Loan deduction rounding: Rounded down to a whole pound
Not modelled: Cumulative tax adjustments, salary sacrifice, benefits in kind

Growth, inflation and long-run interest figures are assumptions, not published rates. Change them and the projection changes.

Why the student loan line jumps in a bonus month

What your employer does

• Adds the bonus to your regular pay for that month
• Compares the total against the monthly threshold of £2,448
• Deducts 9% of the excess, rounded down to a whole pound
• Never looks back at earlier months for the loan deduction
• Adds a further 6% above £1,750 if you have a Postgraduate Loan

Is it an overpayment?

• Not if your income for the whole tax year is above the annual threshold
• The annual threshold for Plan 2 is £29,385
• If the year comes in below it, the deduction is refundable
• Refunds come from the Student Loans Company, not your employer
• Check with your P60 at the end of the year

The true cost of a £5,000 bonus

On this payslip, £2,487 of the bonus goes in deductions and £2,513 reaches your account — an effective deduction rate of 49.7%. The student loan share of that is £450.

Because income tax is cumulative, the tax part of that figure is provisional. The bonus & variable pay calculator settles it across the year, and also handles weekly pay and a bonus paid in any tax month.

Surprised by bonus month deductions?

Bonus month payslips can be a shock, especially the student loan line. Both of these are the official pages, not a summary of them.

What you pay on your student loan HMRC rates and thresholds

The bonus month PAYE calculator answers one specific question. For the full picture, start with our UK student loan calculator on the homepage, work out what leaves your payslip each month with the monthly repayment calculator, or check what you can borrow with the student finance calculator. Every tool on the site is listed in the UK student loan calculator directory.

bonus and variable pay calculator: why a bonus month takes a larger deduction
pension salary sacrifice calculator: how sacrificing salary into a pension lowers your deduction
monthly repayment calculator: the monthly deduction taken from your payslip on any plan

Next step

repayment thresholds for every plan - A plan-by-plan table of the income above which you start repaying.
how salary sacrifice affects your repayments - Explains why pension salary sacrifice can lower your deduction.
compare the student loan plans - Your plan sets your threshold, interest and write-off date.
Check your write-off date - Enter your plan and course end year to get the month your balance is cancelled.