Martin Lewis, founder of MoneySavingExpert.com, has revealed that more than 1.1 million student loan overpayments were made during the 2024/25 tax year alone. In total, over 5 million past overpayments may have occurred, potentially entitling many borrowers to significant refunds.
One reader, Caroline, shared her experience after receiving a refund of £949 from the Student Loans Company. She said, “I was amazed to get this refund as I assumed I had paid the correct amount over the years. The process was very straightforward, and the money was transferred straight into my bank account within a week. Thanks for highlighting that repayments aren’t always accurate.”
The primary cause of these overpayments is that many borrowers have had deductions taken monthly from their paychecks despite not earning enough over the entire tax year to warrant repayment. Student loan repayments are only required if annual earnings exceed a set threshold.
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For example, most borrowers on Plan 2 loans—covering English students who started university between 2012 and 2022, as well as all Welsh students from 2012 onwards—must repay only if they earn over £28,470 per year. Repayments are usually deducted at a rate of 9% on monthly earnings exceeding £2,372.
However, because payroll deductions operate on a monthly basis, individuals who earn above this monthly threshold but not over the full year (such as those who worked part of the year or had irregular income through commissions) may have been overcharged.
If you have not worked the full tax year or have a variable income, you might want to check if you are owed a refund from your student loan repayments.