Scholes has played 34 times for Man United this season, scoring six goals. Scholes joined United in 1991 as a trainee and the 35-year old has gone on to make 639 appearances for United, scoring 148 goals with more yet to come.
Sir Alex Ferguson said: "We are delighted Paul is staying on for another year.
"His form this year indicates his ability and his enjoyment of the game are as strong as ever, that’s every reason to stay on.
"There was talk about him wanting to retire, but when you see his enjoyment in training and playing you can see how much he wants to carry on."
Scholes has been a fantastic servant for the club and thoroughly deserves to be awarded a new contract. There had been doubts over his future at Old Trafford but everyone is happy to see him sign this new contract.
Scholes said: "I am pleased to have signed for another year. I am feeling good and enjoying my football.
"I would like to thank the boss, the coaching staff and also the fans for their continued support."
