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If you have student income (a student loan for maintenance and grants paid to you for your course), it usually counts as income for universal credit (UC).1 This chapter explains how much monthly income counts in the assessment.
Note: you do not count as having student income if you are no longer receiving education (see here).2 So if you have left or finished your course and you get a payment of student income, it is disregarded. Note also that one-off lump-sum payments of student income count as capital (see here).
| Step 1 | Add together the annual income from grants and loans. Add the annual amount of any grants, ignoring those that are disregarded, to the annual amount of any loan (see below). |
| Step 2 | Work out the period over which your student income counts. Calculate this from the month in which you start your course until the month before the summer vacation or end of your course, as applicable (see here). |
| Step 3 | Divide income throughout the year. Divide the amount in Step 1 by the number of months over which your student income counts for that year (see here). |
| Step 4 | Deduct disregard. Deduct a set amount of £110 from the monthly amount of income from grants and loans. |
| Step 5 | Add other income to the monthly amount. Add any other income to be taken into account (eg, earnings) to the monthly grant and loan amount you arrived at after deducting the disregard at Step 4. This is the amount of income used in the UC assessment. |
If you are awarded a loan for maintenance, it counts as income when working out universal credit (UC). The maximum loan you could be entitled to is taken into account, as though there were no reduction for household income or another grant.1 The special support loan is ignored, because it is for course costs.
If you do not have a loan for maintenance, but you could get one by taking ‘reasonable steps’, you are treated as if you have one – it counts as ‘notional’ income. If you have a principled and conscientious objection to taking out a loan (eg, because of religious beliefs), this may mean there are no reasonable steps you can take to get a loan. If this applies, there should be no loan income taken into account.2
Any other grants you receive are disregarded, except for any amount for the maintenance of your partner and/or child(ren) and any specific amount for rent payments that are met by UC.3 A lone parents’ grant paid as well as your loan counts as income. Discretionary fund payments are ignored, provided they are not for the maintenance of your partner or child(ren) and not a specified amount for rent that is met by UC. Note: a one-off payment from discretionary funds counts as capital rather than income (see here).
If you do not get a loan for maintenance, but you receive a grant, the grant income is taken into account for UC (subject to the disregards below).1 A grant is an educational grant or award and does not include education maintenance allowance payments.2 It includes any other grants or awards – eg, stipends paid to PhD students (as long as these are not provided under a contract of employment).
Grant income is taken into account, excluding any payment for:3
Further education students who are parents, and other students eligible for UC, may be awarded a lower (£28 a week) rate of the discretionary bursary maintenance allowance. Some students may not get any bursary maintenance allowance, which may mean they are not ‘receiving education’ and can get UC (see here). In either case, you should not be treated as having an award of bursary maintenance allowance, or a higher award, because the rules can only treat you as having access to such income if it ‘would be available to [you] upon the making of an application’.4 You should not be treated as having access to a discretionary bursary if you do not have one because, by its nature, there is no guarantee you would get it if you applied.
If you get a grant, but no loan for maintenance, and receive discretionary fund payments, they are disregarded if they are paid for any of the above bullet points but otherwise count as income. Note: a one-off payment from discretionary funds counts as capital rather than income (see here).
*Note that the summer accommodation grant is paid as a lump sum, so it counts as capital rather than income (see here).
**Arguably £5 a day of the paramedic, nursing and midwifery bursary should be ignored as it is paid for travel expenses (see here).
Universal credit (UC) is paid monthly, for an ‘assessment period’. Each assessment period runs from the day of the month you claimed UC, for one month – eg, if you claim on the second of the month, each assessment period runs from the second of the month to the first of the following month. The annual amount of your student income must be divided over the number of assessment periods in the course year to arrive at the monthly amount that is used to work out UC. If your UC award starts during the course, each period of a month before your award starts is treated as an assessment period when working out over how many assessment periods your student income counts – ie, some student income is ‘allocated’ to notional assessment periods before the UC award starts.
Student income counts for each assessment period during your course, excluding the one at the end of each academic year and those in the long vacation.1
Student income counts as income:
Student income is ignored:2
The ’long vacation’ is the longest holiday in a course that lasts at least two years, and it must last for at least one month.4
Note that for courses with no long vacation (such as paramedic, nursing and midwifery courses), this may mean that student income is taken into account over 12 months of the year. Masters courses are also usually one full year.
Once you have calculated the number of assessment periods in the course year, divide the total annual amount of loans and/or grants by this number and apply the monthly disregard. £110 of student income is disregarded in each assessment period.5
Examples
Laura has a five-year-old daughter and is single. She starts a degree course. Year one of her course runs from 21 September 2026 to 7 May 2027. Her assessment periods run from the third of the month to the second of the following month.
Step 1: Laura gets a loan of £10,400 (£8,000 maintenance loan and £2,400 special support loan), independent students’ bursary of £1,000 and lone parents’ grant of £1,305.
Step 2: her independent students’ bursary and special support loan are disregarded. Her maintenance loan and lone parents’ grant (total £9,305) count as income over eight assessment periods in the first year of her course (from 3 September 2026 to 2 May 2027).
Step 3: £9,305 ÷ 8 = £1,163.12
Step 4: £1,163.12 – £110 = £1,053.12
Step 5: she has no other income. Laura’s UC is calculated on student income of £1,053.12 a month from 3 September 2026 to 2 May 2027. From 3 May 2027, income from her student funding is nil. Laura’s next UC payment in June 2027 will be based on £0 student funding.
Paula has a seven-year-old son and is single. Her course runs from 31 August 2026 to 28 May 2027. Her assessment periods run from the 14th of the month to the 13th of the following month.
Step 1: Paula gets a further education bursary maintenance allowance of £1,120 (40 weeks at £28).
Step 2: her bursary counts as income over nine assessment periods (from 14 August 2026 to 13 May 2027).
Step 3: £1,120 ÷ 9 = £124.44
Step 4: £124.44 – £110 = £14.44
Step 5: she has no other income. Paula’s UC is calculated on student income of £14.44 a month from 14 August 2026 to 13 May 2027.
Jack is a nursing student and is single with a six-year-old son. Year one of his course runs from 14 September 2026 to 10 September 2027. His assessment periods run from the 6th to the 5th of each month.
Step 1: Jack gets a nursing bursary of £10,000, a dependants’ allowance of £3,640 and a single parent’s allowance of £2,303.
Step 2: his student income of £15,943 counts as income over 12 assessment periods (from 6 September 2026 to 5 September 2027).
Step 3: £15,943 ÷ 12 = £1,328.58
Step 4: £1,328.58 - £110 = £1,218.58
Step 5: Jack has no other income. His UC is calculated on student income of £1,218.58 from 6 September 2026 to 5 September 2027.
Note: Jack could also argue that £1,300 of the £10,000 bursary should be disregarded, as it is for travel (£5 a day x 5 x 52).
Your earnings and your partner’s earnings are taken into account in the universal credit (UC) assessment. Your net monthly earnings are taken into account – ie, after deducting:
Some of your earnings are disregarded if you have children or if you are ill or disabled. This is known as a ‘work allowance’. The lower work allowance if you get help with housing costs (rent or service charges) in your UC is £427 a month. You get a higher work allowance of £710 if you have no help with housing costs in your UC. Earnings above your work allowance are deducted at 55 pence for every pound above the allowance. If you do not get a work allowance, 55 pence for every pound of your earnings is deducted from your UC amount.
For full details of the way earnings are treated, see CPAG’s Welfare Benefits Handbook.
Child benefit is paid to people who are responsible for a child or qualifying young person. You do not have to have paid national insurance contributions to qualify for child benefit. It is not means tested, so the amount you get is not affected by your student loan, grant or other income. If you (or your partner) earn over £60,000 per year and you (or your partner) get child benefit, you may have extra income tax to pay (known as the ‘high-income child benefit charge’).
You qualify for child benefit if:1
You do not have to be the child’s parent to claim child benefit for them.
Being a student, whether full or part time, does not affect your entitlement to child benefit.
If you are a qualifying young person (see below), your parent or someone else who is responsible for you may be able to claim child benefit. You cannot, however, claim child benefit for yourself.
If a qualifying young person gets universal credit in their own right, any child benefit paid for the young person stops.
If a young person lives with a partner or is married or in a civil partnership, you can get child benefit for them if they live with you or you still contribute to their support, but only if their partner is in relevant education or approved training. The young person’s partner cannot be the claimant.
In some circumstances special rules apply – eg, if your child is being looked after by a local authority or is in prison or a young offenders institution .
ss141-47 SSCBA 1992
Anyone aged under 16 counts as a ‘child’ for child benefit purposes, whether or not they go to school. Provided you meet the other qualifying conditions, child benefit can be paid for them.1 Child benefit can also be paid for a child after they reach 16 until at least 31 August after their 16th birthday, and then for as long as they continue to count as a qualifying young person.
s142(1) SSCBA 1992; reg 4 CB Regs
A ‘qualifying young person’ is someone who:1
Full-time, non-advanced education
’Full time’ is more than 12 hours a week of classes and supervised study during term time (if you do less because of illness or disability, you can qualify).
’Non-advanced education’ is anything below degree, Higher National Certificate or Higher National Diploma level and includes school-level courses (Nationals, Highers, Advanced Highers), Scottish Vocational Qualification levels 1–3, National Certificates, National Progression Awards and Scottish Wider Access Programme courses.
If your child counts as a qualifying young person on more than one of the above grounds, they count as a qualifying young person until the last day that applies.4
If you stop being entitled to child benefit for your child because they no longer count as a qualifying young person, but they later satisfy one of the above conditions again and so count as a qualifying young person once more, child benefit can again become payable for them. Note: in some cases, you can continue to claim during such an interruption - eg, if the young person is ill or the gap is less than six months. In both cases, the interruption must be accepted as being reasonable.5
Note: in the rest of this chapter, the term ‘child’ is used to mean both children under 16 and qualifying young people aged 16 or over.
If your child is 16 or 17, they continue to count as a qualifying young person, and so child benefit can continue to be paid for them during an ‘extension period’ if:1
In this context, ‘education’ and ‘training’ are not defined and so may mean any kind of education or training.
The extension period starts from the Monday after your child’s course of education or training ends and lasts for 20 weeks from that date. If your child reaches 18 during the extension period, unless they count as a qualifying young person on another ground (see here), your child benefit for them ends from the first child benefit payday on or after which they reach 18.2
If your child leaves full-time, non-advanced education (see here) or approved training before reaching 20, they continue to count as a qualifying young person until:1
The general rule means that unless they continue to count as a qualifying young person on another ground or are returning to sit an exam (see below), you stop receiving child benefit for them on that date.
Your child’s ’terminal date’ is the first of the following dates that falls after the date their full-time, non-advanced education or approved training finishes:
– the last day in February;
– the last day in May;
– the last day in August;
– the last day in November.
If someone is doing a Higher Certificate or Advanced Higher Certificate and leaves full-time, non-advanced education earlier than they would have done if they were doing a comparable course in England and Wales, the terminal date is the one that would have applied had they had been doing the comparable course.2
A child who returns to sit an external examination in connection with their course of relevant education is treated as still being in relevant education until the date of the last exam.3
Child benefit is administered by HMRC. You can claim online at gov.uk/child-benefit/how-to-claim, or you can claim on Form CH2, which you can get from the Child Benefit Office on 0300 200 3100 or gov.uk/government/publications/child-benefit-claim-form-ch2. The form can be completed online but must be printed, signed and sent by post.
You should make a claim within three months of becoming eligible. This is because your claim can usually only be backdated for up to three months. You do not have to show any reasons why your claim was late.
Child benefit is usually paid directly into your bank (or similar) account. Which account it goes into is up to you. If you do not want your benefit to go into an account that is overdrawn, give HMRC details of an alternative account if you have access to, or can open, one.
If you think a decision about your child benefit is wrong, you can ask HMRC to look at it again. This process is known as a ‘mandatory reconsideration’. Provided you ask within the time limit (usually one month), HMRC notifies you of the decision in a ‘mandatory reconsideration notice’. If you are still not happy when you get this notice, you can appeal to the independent First-tier Tribunal. If it was not possible to ask HMRC to reconsider the decision within a month, you can ask for a late revision (within 13 months), explaining why it is late. You can also ask HMRC to look at a decision again at any time if certain grounds are met – eg, if there has been an official error.
