Payroll · Plan 5

New starter marked Student Loan Plan 5? Keep the declaration and first FPS evidence together.

Student Loan Plan 5 setup needs a clean chain from employee answer to payroll software, first payslip deduction check and FPS receipt. The risk is usually missing evidence, not just calculation.

Direct answer

GOV.UK says employers should ask new employees if they have a student loan and record the student loan plan in payroll software.

HMRC guidance, payroll software and official notices control. This is an operational checklist, not payroll or tax advice.

Source base: GOV.UK new employee student loans, special rules for student loans and starter checklist for PAYE.

SEO focus

Student Loan Plan 5 new starter payroll checklist

Help UK payroll teams document Plan 5 setup for new starters. Updated 2026-07-08.

Checklist controls

Check	What to confirm	Proof to retain
Starter	P45 received or starter checklist completed.	Document PDF.
Plan	Plan 5 answer and any other loan answer.	Declaration fields.
Software	Payroll record reflects the selected plan.	Setup screenshot.
Payslip	First pay result and threshold treatment.	Payslip preview.
FPS	Submission receipt and correction note if needed.	FPS receipt.

Do not infer

Use the employee answer.

Plan type should be based on declaration or HMRC instruction, not age or degree memory.

Multiple loans

Preserve all answers.

A postgraduate loan answer can coexist with student-loan plan information.

Limit

Software calculates.

Manual changes need clear HMRC or provider evidence.

Plan 5 starter packet

Save the P45 or completed starter checklist before first payroll run.
Record Plan 5 and any other student or postgraduate loan answer exactly as declared.
Check payroll software setup and first-payslip output before FPS submission.
Archive FPS receipt and note any correction if the answer changes later.
Keep the employee declaration, payslip preview and submission proof in the payroll file.

FAQ

Can we assume Plan 5 from graduation year?: No. Keep the employee declaration or HMRC instruction as evidence.
Does payroll software calculate the deduction?: GOV.UK says software works out deductions after the correct answer is recorded.
Is this payroll advice?: No. It is an evidence checklist.

Updated 2026-07-08. This page is independent and does not replace official services, professional advice or site-specific rules.