April 2026 will see the introduction of a new Plan 5 Student Loan with the following key features:
- It has a lower repayment threshold (£25,000);
- It is a longer repayment period (40 years)
However, Plan 5 will apply only to borrowers who applied to Student Finance England for new courses from 01 August 2023.
On 02 March 2026, HMRC updated the Starter Checklist so new employees can select whether they have this Plan.
This is good news if employers use this version or model their own versions on the new Checklist. However, be aware that the online Starter Checklist is showing incorrect information. Many employers choose to give a link to this, asking new employees to complete it and print or forward on.
The difference is subtle but important:
- The pdf version of the checklist correctly states the type of Plan depends on where the application for finance was made (Student Finance England, Students Award Agency Scotland etc); but
- The online version incorrectly states that the Plan type depends on where the new employee was living when they started their course
All Student Loan Plan types, and Postgraduate ones, depend on where the application for finance was made. The country in which they were living when they started the course is irrelevant.
For Bookkeepers
Please ensure you are using the version with the reference ‘12/25’ in the bottom righthand corner of page 1.
ICB also recommends caution on accepting Starter Checklists that have been completed online as it may give misleading information and result in the wrong Plan type being used. The type of Student Loan has nothing to do with where the new employee / borrower was living when they took out their Loan.
