Benefits for Students in Scotland Handbook 2025/26Part 3: Treatment of income Chapter 13: How income affects means-tested benefits
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Chapter 13: How income affects means-tested benefits
This chapter explains how much weekly income is taken into account when working out your entitlement to the remaining working-age means-tested benefits - these are income-related employment and support allowance (ESA) and housing benefit (HB). For information on how income affects universal credit, see Chapter 12.
Basic facts
    •Student loans for maintenance count as income and are normally divided over 42 or 43 weeks from the beginning of September to the end of June and taken into account as income for means-tested benefits during that period. If your income is too high, you do not get income-related ESA, and your HB is reduced (or may end).
    •The amount of student loan for maintenance you could get is taken into account as income, whether or not you apply for it.
    •If you or your partner are over pension age, your student grant and loan are ignored as income for HB.
    •Student loans are normally not taken into account as income for means-tested benefits from around the end of June until the beginning of September. You may be able to get more benefit during these months even if your benefit was reduced during the academic year.
    •Some grants are also taken into account as income, but others do not affect your benefit.
A grant is defined as an educational grant or award, bursary, scholarship or allowance and does not include education maintenance allowance or discretionary fund payments.1ESA Reg 131(1), definition of ‘grant’, ESA Regs HB Reg 53(1), definition of ‘grant’, HB Regs In general, grants intended for living costs are taken into account and grants for other costs are disregarded. For the way that discretionary funds are treated, see here.
If you are not eligible for a student loan, deduct from your grant:
    •£390 for books and equipment; and
    •£303 for travel.
An assessed contribution from a partner or parent counts as income, whether or not you receive it. However, for income-related ESA, if you are a disabled student, only include contributions that are actually paid.2ESA Reg 131(1) ESA RegsHB Reg 53(1) HB Regs
Ignore any grants for:3ESA Reg 132(2) ESA RegsHB Reg 59(2) HB Regs
    •tuition fees or exam fees;
    •course-related disability costs;
    •residential study away from your normal home;
    •books and equipment, or travel;
    •for income-related ESA only, maintenance of a child dependant;
    •childcare costs.
 
1     ESA Reg 131(1), definition of ‘grant’, ESA Regs HB Reg 53(1), definition of ‘grant’, HB Regs  »
2     ESA Reg 131(1) ESA RegsHB Reg 53(1) HB Regs »
3     ESA Reg 132(2) ESA RegsHB Reg 59(2) HB Regs »
1. Working out your income
The way that student income is taken into account for income-related employment and support allowance (ESA) and housing benefit (HB) is essentially the same (see Chapter 12 for universal credit). Chapters 4 and 6 outline the income-related ESA and HB assessments step by step. This chapter explains how much weekly income counts in these assessments.
Step
Action
Step 1
Add together the annual income from grants and loans.
Add the annual amount of any student grants, ignoring any that are wholly disregarded (see here), to the annual amount of any student loan for maintenance.
Step 2
Apply annual disregards.
From the total annual grants and loans, deduct any disregarded amounts for books and equipment, and for travel (see here).
Step 3
Divide income into a weekly amount.
Divide the annual amount of grants and loans by the number of benefit weeks in the period over which your grants and loan are counted as income for benefit purposes (see here).
Step 4
Deduct any weekly disregard.
If you have a student loan for maintenance, deduct £10 – this is the weekly disregard.
Step 5
Add other income to the weekly amount.
Add together any other weekly income – eg, from discretionary funds (here), earnings (here), tariff income from capital (here), and benefits (here). Ignore any amount that is disregarded. This total, added to the weekly grants and loans total at Step 4, is the amount of income used in the benefit assessment.
If you want to work out your benefit entitlement during the long vacation, see here for when the long vacation starts and finishes for benefit purposes – ie, when your student loan or grant counts as nil income. You should then total on a weekly basis any other income you have over the vacation (note that the summer accommodation grant is paid as a lump sum and therefore counts as capital rather than income).
2. Grants and loans
Grants
Undergraduate grants
The following higher education (HE) grants are disregarded:
    •lone parents’ childcare grant;1ESA Reg 132(2)(i) ESA Regs
    HB Reg 59(2)(h) HB Regs
    •disabled students’ allowance;2ESA Reg 132(2)(b) ESA Regs
    HB Reg 59(2)(b) HB Regs
    •lone parents’ grant for income-related employment and support allowance (ESA);
    •travel expenses;3ESA Reg 132(2)(g) ESA Regs
    HB Reg 59(2)(g) HB Regs
    •tuition fees.4ESA Reg 132(2)(a) ESA Regs
    HB Reg 59(2)(a) HB Regs
The following HE grants are taken into account:
    •young students’ bursary;
    •independent students’ bursary;
    •estranged students’ bursary;
    •care-experienced students’ bursary;
    •lone parents’ grant. This is always taken into account for housing benefit (HB) but disregarded for income-related ESA.5ESA Reg 132(2)(h) ESA Regs
    Note: the rules do not specifically disregard the lone parents’ grant but rather disregard ‘any payment… intended for the maintenance of a child dependant’. Since Student Awards Agency Scotland pays this grant only to students with children for their maintenance, it should be disregarded under this rule for income-related ESA.
 
1     ESA Reg 132(2)(i) ESA Regs
HB Reg 59(2)(h) HB Regs
 »
2     ESA Reg 132(2)(b) ESA Regs
HB Reg 59(2)(b) HB Regs
 »
3     ESA Reg 132(2)(g) ESA Regs
HB Reg 59(2)(g) HB Regs
 »
4     ESA Reg 132(2)(a) ESA Regs
HB Reg 59(2)(a) HB Regs
 »
5     ESA Reg 132(2)(h) ESA Regs
Note: the rules do not specifically disregard the lone parents’ grant but rather disregard ‘any payment… intended for the maintenance of a child dependant’. Since Student Awards Agency Scotland pays this grant only to students with children for their maintenance, it should be disregarded under this rule for income-related ESA.
 »
Paramedic, nursing and midwifery students’ grants
The following grants are disregarded:
    •childcare allowance;
    •disabled students’ allowance;
    •dependants’ allowance for a child, and single parent’s allowance – for income-related ESA;
    •travel and placement expenses.
The following are taken into account:
    •paramedic, nursing and midwifery bursary;
    •single parent’s allowance – for HB;
    •dependants’ allowance for an adult;
    •dependants’ allowance for a child – for HB.
Postgraduate grants
The following are taken into account:
    •maintenance grant;
    •dependants’ grant.
Grants in further education
The following further education (FE) grants are disregarded:
    •education maintenance allowance;1ESA Sch 8 para 13 ESA Regs
    HB Sch 5 para 11 HB Regs
    •additional support needs for learning allowance for disability costs;2ESA Reg 132(2)(b) ESA Regs
    HB Reg 59(2)(b) HB Regs
    •study expenses allowance if paid for books and equipment;3ESA Reg 132(2)(f) ESA Regs
    HB Reg 59(2)(f) HB Regs
    •lone parents’ childcare grant;4ESA Reg 132(2)(i) ESA Regs
    HB Reg 59(2)(h) HB Regs
    •travel expenses allowance.5ESA Reg 132(2)(g) ESA Regs
    HB Reg 59(2)(g) HB Regs
The following FE grants are taken into account:
    •bursary maintenance allowance;
    •care-experienced bursary maintenance allowance;
    •dependants’ allowance.
FE students who are lone parents and other students eligible for income-related ESA can stay on income-related ESA instead of applying for a discretionary bursary maintenance allowance. This is because the rules can only treat you as having access to such income if it ‘would become available to [you] upon application’.6ESA Reg 106(2) ESA Regs
 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.
Grants and loans checklist
Student support
Treatment
Undergraduate income
Student loan for maintenance (including young students’ bursary)
Disregard:
– £390 a year for books and equipment;
– £303 a year for travel;
– £10 a week (further disregard from loan);
– amount of student’s contribution to loan;
– partner’s contribution.
Special support loan
Disregarded.
Independent students’ bursary
Taken into account in full.
Estranged students’ bursary
Taken into account in full.
Care-experienced students’ bursary
Disregard:
– £390 a year for books and equipment;
– £303 a year for travel.
Summer accommodation grant
Taken into account as capital.
Disabled students’ allowance
Disregarded.
Lone parents’ grant
Taken into account in full for HB.
Disregarded for income-related ESA.
Lone parents’ childcare grant
Disregarded.
Travel expenses
Disregarded.
Discretionary funds
Taken into account if paid for basic living costs (as capital if not regular payments) less a weekly disregard.
Disregarded if paid for other items.
Childcare fund
Disregarded.
Part-time fee grant
Disregarded.
Paramedic, nursing and midwifery student income
Paramedic, nursing and midwifery bursary
Disregard:
– £390 a year for books and equipment;
– £303 a year for travel.
Dependants’ allowance for adult
Taken into account in full.
Dependants’ allowance for child
Taken into account in full for HB.
Disregarded for income-related ESA.
Single parent’s allowance
Taken into account in full for HB.
Disregarded for income-related ESA.
Childcare allowance
Disregarded.
Disabled students’ allowance
Disregarded.
Travel and placement expenses
Disregarded.
Postgraduate income
Tuition fees (including tuition fee loan) and exam fees
Disregarded.
Postgraduate living cost loan
Disregard:
– £390 a year for books and equipment;
– £303 a year for travel;
– £10 a week (further disregard from loan).
Special support loan
Disregarded.
Residential study
Disregarded.
Books, equipment and travel
Disregarded.
Maintenance grant
Disregard:
– £390 a year for books and equipment;
– £303 a year for travel.
Further education income
Bursary maintenance allowance
Disregard:
– £390 a year for books and equipment;
– £303 a year for travel.
Care-experienced bursary maintenance allowance
Disregard:
– £390 a year for books and equipment;
– £303 a year for travel.
Dependants’ allowance
Taken into account in full.
Education maintenance allowance
Disregarded.
Additional support needs for learning allowance
Disregarded for disability costs.
Study expenses allowance
Disregarded for books and equipment.
Lone parents’ childcare grant
Disregarded.
Travel expenses allowance
Disregarded.
Childcare fund
Disregarded.
FE discretionary fund
Taken into account less weekly disregard if paid for basic living costs.
Disregarded if paid for other items.
 
1     ESA Sch 8 para 13 ESA Regs
HB Sch 5 para 11 HB Regs
 »
2     ESA Reg 132(2)(b) ESA Regs
HB Reg 59(2)(b) HB Regs
 »
3     ESA Reg 132(2)(f) ESA Regs
HB Reg 59(2)(f) HB Regs
 »
4     ESA Reg 132(2)(i) ESA Regs
HB Reg 59(2)(h) HB Regs
 »
5     ESA Reg 132(2)(g) ESA Regs
HB Reg 59(2)(g) HB Regs
 »
6     ESA Reg 106(2) ESA Regs
 »
Student loans for maintenance
You should include in the student loan amount:
    •the maximum loan for maintenance for which you are eligible, including the young students’ bursary.1ESA Reg 131(1), definition of ‘student loan’, ESA Regs
    HB Reg 53(1), definition of ‘student loan’, HB Regs
     This is taken into account as your income whether or not you apply for it, if you could get one by taking ‘reasonable steps’.2ESA Reg 137(4) and (5) ESA Regs
    HB Reg 64(3) and (4) HB Regs
     This means that students cannot choose to keep maximum income-related ESA instead of applying for a loan; you are treated as though you had taken out the full loan and your benefit is reduced or stopped accordingly; and
    •the assessed contribution from a parent or partner, whether or not you receive it. However, for income-related ESA, only contributions that are actually paid are included.3ESA Reg 137(5)(a) ESA Regs
    HB Reg 64(4) HB Regs
The special support loan is ignored, because it is for course costs such as study and travel costs.4ESA Reg 139A ESA RegsHB Reg 64B HB Regs
You should deduct from the annual student loan for maintenance:
    •£390 for books and equipment; and
    •£303 for travel.
There is a further disregard of £10 a week that applies once the student loan has been divided over the number of weeks in the period of study to arrive at a weekly amount.5ESA Reg 137(3) ESA Regs
HB Reg 64(2) HB Regs
Postgraduate living cost loans are taken into account in the same way.
 
1     ESA Reg 131(1), definition of ‘student loan’, ESA Regs
HB Reg 53(1), definition of ‘student loan’, HB Regs
 »
2     ESA Reg 137(4) and (5) ESA Regs
HB Reg 64(3) and (4) HB Regs
 »
3     ESA Reg 137(5)(a) ESA Regs
HB Reg 64(4) HB Regs
 »
4     ESA Reg 139A ESA RegsHB Reg 64B HB Regs »
5     ESA Reg 137(3) ESA Regs
HB Reg 64(2) HB Regs
 »
3. Dividing student income throughout the year
The annual amount of your loan and grant must be divided over the number of weeks in, usually, a standard academic year to arrive at the weekly amount used to calculate income-related employment and support allowance (ESA) and housing benefit (HB). The ‘standard academic year’ begins on 1 September, 1 January, 1 April or 1 July depending on whether your course begins in the autumn, winter, spring or summer.1ESA Reg 131(1) ESA RegsHB Reg 53(1) HB Regs
 Courses that start in August are taken to have an academic year starting on 1 September.2ESA Reg 131(1), definition of ‘academic year’, ESA RegsHB Reg 53(1), definition of ‘academic year’, HB Regs
 Rules specify exactly the weeks over which the loan and grant are taken into account.
 
1     ESA Reg 131(1) ESA RegsHB Reg 53(1) HB Regs
 »
2     ESA Reg 131(1), definition of ‘academic year’, ESA RegsHB Reg 53(1), definition of ‘academic year’, HB Regs
 »
Student loans for maintenance
Student loans for maintenance are normally divided over 42 or 43 weeks from the beginning of September to the end of June. During this period, your student loan is taken into account as your income in the assessment of income-related ESA and HB. If your income is too high, you are not eligible for these benefits. However, your student loan is not taken into account from around the end of June to the beginning of September. Because your income goes down in these months (unless you have other income – eg, from earnings), you may be able to get more benefit during the summer.
The details of the weeks over which your loan is taken into account are as follows.
Courses starting in the autumn term lasting more than a year
The student loan for maintenance is divided over the number of weeks starting from the first day of the first benefit week in September until the last day of the last benefit week in June.1ESA Reg 137(3)(e) ESA Regs
HB Reg 64(2)(d) HB Regs
 In 2025/26, this is 42 weeks for benefit weeks that begin on a Thursday, Friday, Saturday or Sunday and 43 weeks for benefit weeks that begin on a Monday, Tuesday or Wednesday. If your course starts in August, you count the weeks starting from the first day of the first benefit week on or after the start of your course, until the last day of the last benefit week in June.
This is the period over which your loan is taken into account as income in the benefit assessment, unless you do not count as a student at all. For example, at the start of your first year, you do not count as being a student until you actually start attending or undertaking the course. In other words, in the first year the loan is still divided over 42/43 weeks, but the weekly amount arrived at is ignored as income until you start your course.2CIS/3734/2004
In the final year of study, the loan is divided over the number of benefit weeks starting from the first day of the first benefit week in September (or the start of the first term if it starts in August) until the end of the benefit week on or before the last day of the final academic term.3ESA Reg 137(3)(d) ESA Regs
HB Reg 64(2)(c) HB Regs
For HB, the start of the benefit week is a Monday.4Reg 2 HB Regs
 For ESA, it depends on your national insurance number.5ESA Reg 2(1) ESA Regs
Example: first-year student claiming income-related employment and support allowance
Samira is in her first year. She gets income-related ESA and adult disability payment. She gets a student loan of £10,400 (£8,000 maintenance loan and £2,400 special support loan) and an independent students’ bursary of £1,000. Her first term begins on Monday 15 September 2025. Her benefit weeks start on Fridays. Her student loan is divided over the weeks from Friday 5 September 2025 until Thursday 25 June 2026 (42 weeks) to get a weekly income figure. However, because she is in her first year, she does not count as a student until she starts university on 15 September and so her student income is ignored until then.
From the start of term:
Her weekly loan and grant income is:
- maintenance loan plus independent students’ bursary = £9,000
- less disregards for books and equipment (£390) and travel (£303) = £8,307
- divided by 42 weeks = £197.79
- less £10 weekly loan disregard = £187.79
£187.79 is taken into account as weekly income from her loan and grants between Friday 19 September 2025 and 25 June 2026.
Her ESA applicable amount is £140.55 a week. She gets her usual ESA until she starts her course. From 19 September, her ESA stops because her income is higher than her ESA applicable amount.
At the end of the academic year:
Her weekly income from her loan between 26 June and 17 September 2026 is nil. Samira cannot reclaim ESA, but she would be eligible for universal credit (UC) from just under a month before her long vacation starts (see here).
Example: second-year student claiming housing benefit
Agnes is in her second year. She has one child aged six. Agnes is claiming HB as a lone parent student in temporary accommodation (her UC stops because her student income is too high, so HB has to be calculated). She gets a student loan of £10,400 (£8,000 maintenance loan and £2,400 special support loan) and an independent students’ bursary of £1,000. She also gets a lone parents’ grant of £1,305. Her student income for HB is £10,305. Her first term begins on 1 September 2025. Her student loan is divided over the weeks from Monday 1 September 2025 until Sunday 28 June 2026 (42 weeks).
The weekly loan income taken into account is:
- loan plus grants = £10,305
- less disregards for books and equipment (£390) and travel (£303) = £9,612
- divided by 42 weeks = £228.86
- less £10 weekly loan disregard = £218.86
£218.86 is taken into account as weekly income from her loan between 1 September 2025 and 28 June 2026. Her weekly income from her loan between 29 June and 6 September 2026 is nil.
 
1     ESA Reg 137(3)(e) ESA Regs
HB Reg 64(2)(d) HB Regs
 »
2     CIS/3734/2004 »
3     ESA Reg 137(3)(d) ESA Regs
HB Reg 64(2)(c) HB Regs
 »
4     Reg 2 HB Regs
 »
5     ESA Reg 2(1) ESA Regs
 »
Courses not starting in the autumn term
Your student loan for maintenance is divided over the number of weeks starting from the first day of the first benefit week on or after the beginning of a standard academic year (see here), and ending on the last day of the last benefit week on or before the last day of the academic year, but excluding benefit weeks that fall entirely within the quarter that is taken by the DWP to be the longest vacation.1ESA Reg 137(3)(b) ESA Regs
HB Reg 64(2)(b) HB Regs
Academic years and quarters
‘Academic years’ in this case are 12 months, beginning on 1 January, 1 April or 1 July for courses that begin in winter, spring or summer respectively.
‘Quarters’ are 1 January to 31 March, 1 April to 30 June, 1 July to 31 August, 1 September to 31 December.2ESA Reg 137(3)(c) ESA Regs
HB Reg 64(2)(b) HB Regs
Example
Anya’s course begins on 5 January 2026. The main vacation is 27 June to 30 August 2026. She is claiming HB and the benefit week starts on a Monday. Her loan is divided over the weeks from Monday 5 January 2026 to Sunday 5 July 2026, and from Monday 31 August 2026 until Sunday 27 December 2026. From 6 July to 30 August 2026, her student loan income is nil for benefit purposes.
 
1     ESA Reg 137(3)(b) ESA Regs
HB Reg 64(2)(b) HB Regs
 »
2     ESA Reg 137(3)(c) ESA Regs
HB Reg 64(2)(b) HB Regs
 »
Courses lasting one year or less
Your loan for maintenance is divided over the number of weeks from the first day of the first benefit week on or after the start of a standard academic year (see here) (or, if a course begins in August, from the first day of the first benefit week on or after the first day of the course) until the last day of the last benefit week on or before the last day of the course. The weekly amount that results is then taken into account from the point you actually start attending or undertaking the course.1ESA Reg 137(3)(a) ESA RegsHB Reg 64(2)(a) HB Regs
 
1     ESA Reg 137(3)(a) ESA RegsHB Reg 64(2)(a) HB Regs
 »
If you leave your course early
If you abandon your course early or are dismissed from it before you have had the final instalment of your student loan in that academic year, the loan continues to be taken into account up until the day before you would have been due your next loan payment or to the end of the quarter (see above) in which you left, whichever is earlier. This means that if your loan payments stop shortly after you leave the course, they are only taken into account (and affect any benefits) for a short period.
To calculate the amount of loan taken into account, start by working out the weekly amount of annual loan, with disregards for books, equipment and travel but without the £10 weekly disregard. Then, subtract this amount of weekly loan for the period from the start of the standard academic year (see here) to the day you left from the amount of loan (minus the £693 disregards) you have been paid so far. The result is then divided over the weeks from when you left to when your next instalment would have been due or the end of the quarter, whichever is earlier.
 
Example: employment and support allowance
Nick abandons his course on 10 October 2025. He is in the second year of a three-year course. He gets a small amount of ESA during his course (which includes a severe disability premium). His benefit week starts on a Monday. In Nick’s case, he has already been paid £3,420 of his £11,400 loan/bursary (£8,000 maintenance loan, £2,400 special support loan and an independent students’ bursary of £1,000) by the date he leaves. £720 of this is the special support loan, so only £2,700 counts as income.
Step 1: work out weekly amount of annual income
Loan/bursary
£9,000
Less disregards (£693) =
£8,307
Divided by 43 weeks =
£193.19
 
Step 2: work out amount of annual income before leaving the course
Multiply the weekly annual loan by the number of benefit weeks from the week after the one that includes the start of the standard academic year until the week before the one that includes the day Nick left the course.
£193.19 x 4 weeks (8 September to 5 October) = £772.76
Step 3: work out amount of income ‘left over’ since leaving the course
To do this, add the monthly income instalments paid or due before the date Nick left his course, deduct disregards, and deduct the annual income worked out for the period before leaving.
 
 
Loan up to when left the course
£2,700
Less disregards (£693) =
£2,007
Amount of loan paid taken into account
£2,007
Deduct annual loan before leaving (£772.76) =
£1,234.24
Step 4: work out weekly amount of ‘leftover’ income for the period it is taken into account
 Divide the total amount of leftover loan from Step 3 for the period since leaving the course by the number of weeks from when Nick left to the day before he would have been due his next loan payment or the end of the quarter in which he left, whichever is earlier. Count from the benefit week that includes the day Nick left the course until the benefit week that includes the day before his next loan instalment would have been due had payments continued, or the benefit week that includes the last day of the last quarter for which an instalment was payable whichever is earlier. In Nick’s case, his next loan instalment would have been due on 7 November, and this is before the end of the quarter (31 December).
£1,234.24 ÷ 5 (6 October to 9 November 2025) = £246.85
£246.85 a week is taken into account from 6 October 2025 until 9 November 2025. This is likely to mean that Nick’s ESA ends.
Example: housing benefit
To work out how much loan to take into account for Nick’s HB claim (assuming he is not passported to HB from income-related ESA) after he has left his course, the calculation is slightly different to that for income-related ESA. In Step 2 above, instead of working out the number of benefit weeks up until the week before the one that includes the day Nick left the course, count up until the week that includes the one during which he left the course – ie, there is an extra week in this part of the calculation. Bear in mind that benefit weeks for HB always start on a Monday, and this may not be the same for income-related ESA.
Step 1: work out weekly amount of annual loan
 
 
Loan/bursary
£9,000
Less disregards (£693) =
£8,307
Divided by 43 weeks =
£193.19
 
Step 2: work out amount of annual loan before leaving the course
Multiply the weekly annual loan by the number of benefit weeks from the week after the one that includes the start of the standard academic year until the week that includes the day Nick left the course.
£193.19 x 5 (8 September to 12 October) = £965.95
Step 3: work out amount of loan ‘left over’ since leaving the course
In the same way as in the example for ESA above.
 
Loan up to when left the course
£2,700
Less disregards (£693) =
£2,007
Amount of loan to end of term taken into account =
£2,007
Deduct annual loan before leaving, from Step 2 (£965.95) =
£1,041.05
 
Step 4: work out weekly amount of ‘leftover’ loan for the period it is taken into account
In the same way as in the example for ESA above.
£1,041.05 ÷ 5 (6 October to 9 November 2025) = £208.21
£208.21 a week is taken into account from 6 October to 9 November 2025.
Nick should consider applying for UC, as no student income is counted for UC once he leaves his course.1para H6152 ADM
Note: if you repay the loan, it is still taken into account as income, according to the formula above.2CJSA/549/2003 You could therefore be refused income-related ESA despite having no other money to live on. However, if the Student Loans Company asks you to repay the loan rather than your repaying it voluntarily, arguably the loan should be disregarded as income from the date of the request.3Vol 6, para 30470 DMG
 
1     para H6152 ADM »
2     CJSA/549/2003 »
3     Vol 6, para 30470 DMG »
Grants
To work out the weeks over which your grant is taken into account for means-tested benefits, first check whether there is a specific rule for that type of grant or whether the standard rule applies.
The standard rule for grants
If the standard rule applies, the grant is taken into account from:1ESA Regs 131(1), definition of ‘period of study’, and 132(4) ESA RegsHB Regs 53, definition of ‘period of study’, and 59(5) HB Regs
    •the first day of the first benefit week (see here) on or after the start of the course in the first or only year; or
    •the first day of the first benefit week on or after that year’s start of your course if this is not your first year;
until:
    •the last day of the last benefit week that ends on or before the day before the summer vacation if the course continues after the summer; or
    •the last day of the last benefit week on or before the last day of the final academic term in the final year or on a course lasting a year or less.
The standard rule applies if your grant income is ‘attributable’ to those weeks. Even though you may be paid your grant monthly, if your grant has been awarded for the whole academic year or length of study, it should be taken into account in this way. You may need to ask your college for a statement showing your annual grant entitlement. This statement should break down the grant into the different allowances so that the DWP can apply the correct disregards when working out how much benefit you should get.
If your grant has not been awarded for the whole academic year or length of study, it is taken into account over the period for which it is payable, from the first day of the first benefit week on or after the start of the period for which the grant is payable until the last day of the last benefit week on or before the last day of that period.2ESA Reg 132(4)(b) ESA RegsHB Reg 59(5)(b) HB Regs
 
1     ESA Regs 131(1), definition of ‘period of study’, and 132(4) ESA RegsHB Regs 53, definition of ‘period of study’, and 59(5) HB Regs
 »
2     ESA Reg 132(4)(b) ESA RegsHB Reg 59(5)(b) HB Regs
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Higher education grants
For higher education students, the lone parents’ grant (unless it is disregarded) is taken into account over the same period as the student loan if you have a student loan or you are eligible for one.1ESA Reg 132(6) ESA Regs
HB Reg 59(7) HB Regs
 This is the case even though the Student Awards Agency Scotland guide says that the grant covers 52 weeks.
 
1     ESA Reg 132(6) ESA Regs
HB Reg 59(7) HB Regs
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Paramedic, nursing and midwifery bursaries
Your bursary, dependants’ allowance and single parent’s allowance (unless it is disregarded), if assessed for study throughout the calendar year, are taken into account for the number of benefit weeks within the full calendar year. Otherwise, the award is taken into account under the standard rule for grants (see here).
Further education grants
Your bursary is only taken into account as income during the academic year.
The bursary maintenance allowance and dependants’ allowance are taken into account under the standard rule for grants (see here).
Example: one-year course
Salome is on a one-year course, starting on 18 August 2025 and running until 5 June 2026. She gets a bursary maintenance allowance of £5,273.10 (£125.55 x 42 weeks) for the year. She is getting HB, so her benefit week begins on a Monday. Her allowance is taken into account from Monday 18 August 2025 until Sunday 31 May 2026 (41 weeks). The weekly amount taken into account over that period is:
Total grants for the year
£5,273.10
Less disregards for books and equipment (£390) and travel (£303)
£4,580.10
Divided by 41 weeks =
£111.71
£111.71 a week is taken into account as income for HB from 18 August 2025 to 31 May 2026.
Postgraduate funding
A postgraduate award that is assessed for study throughout the calendar year is taken into account for the number of benefit weeks in the full calendar year.1ESA Regs 131(1), definition of ‘period of study’, and 132(4)(a) ESA Regs
HB Regs 53, definition of ‘period of study’, and 59(5)(a) HB Regs
 Otherwise, the award is taken into account under the standard rule for grants (see here).
Postgraduate living cost loans are taken into account under the standard rule for loans (see here). The special support loan is ignored, because it is for course costs. Students on a Professional Graduate Diploma in Education course may get the same student loan and grants as undergraduates, and these are treated in the same way as undergraduate loans and grants.
 
1     ESA Regs 131(1), definition of ‘period of study’, and 132(4)(a) ESA Regs
HB Regs 53, definition of ‘period of study’, and 59(5)(a) HB Regs
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If you leave your course early
For income-related ESA, if you abandon your course or get dismissed from it, your grant continues to be taken into account, calculated as though you were still a student, until the end of term or vacation in which you stop being a full-time student or, if earlier, until you repay the grant or the period for which the grant is payable ends.1ESA Reg 91(4) ESA Regs
For HB, your grant is not taken into account as if you were still a student. Instead, it is taken into account until the grant provider asks you to repay it and, until then, should be calculated over an appropriate period.2Leeves v Chief Adjudication Officer, reported as R(IS) 5/99; reg 31(1) HB Regs Arguably, your grant should only be taken into account as income until the end of the period your last instalment was meant to cover.
 
1     ESA Reg 91(4) ESA Regs
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2     Leeves v Chief Adjudication Officer, reported as R(IS) 5/99; reg 31(1) HB Regs  »
4. Discretionary funds and other payments
Discretionary funds
Discretionary funds are treated differently from student grants and loans. Discretionary funds include:1ESA Reg 131, definition of ‘access funds’, ESA Regs
HB Reg 53, definition of ‘access funds’, HB Regs
    •higher education (HE) discretionary fund;
    •further education (FE) discretionary fund.
In general, if the payment is for certain living costs, it is taken into account in full if it counts as capital or with up to a £20 a week disregard if it counts as income. If the payment is for other costs, it is disregarded. Ask your college for a letter saying what the payment is for and how it is paid.
A lump-sum payment counts as capital. Regular payments count as income.
The FE and HE childcare funds are disregarded.
 
1     ESA Reg 131, definition of ‘access funds’, ESA Regs
HB Reg 53, definition of ‘access funds’, HB Regs
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Lump-sum payments
Lump-sum payments are taken into account as capital if they are intended and used for food, ordinary clothing or footwear, household fuel, rent met by housing benefit (HB), housing costs met by income-related employment and support allowance (ESA), council tax or water charges.1ESA Reg 142 ESA Regs
HB Reg 68 HB Regs
 Payments for anything else are ignored for up to 52 weeks. Although taken into account as capital, such payments only affect your benefit if they bring your capital above the lower limit (see here). Payments for school uniforms or sports clothes or sports shoes are ignored, as these do not count as ‘ordinary clothing or footwear’.2ESA Reg 2 ESA Regs
 Payments for service charges other than fuel charges that HB does not meet are ignored. Payments for rent in excess of the amount that HB will meet are ignored – eg, if your rent is more than the maximum amount covered by HB (see here).
 
1     ESA Reg 142 ESA Regs
HB Reg 68 HB Regs
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2     ESA Reg 2 ESA Regs
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Regular payments
Regular payments are taken into account as income if they are intended and used for food, ordinary clothing or footwear, household fuel, rent met by HB, housing costs met by income-related ESA, and council tax or water charges.1ESA Reg 138 ESA Regs
HB Reg 65 HB Regs
 However, up to £20 a week is disregarded. You cannot get the £20 disregard in full as well as the full weekly disregards available on a student loan (or on widowed parent’s allowance or war pensions). If you get one of these other payments as well as a discretionary payment, your maximum weekly disregard is £20.
For example, if you have a student loan and regular payments from the HE discretionary fund, £10 a week is disregarded from each.
Regular payments intended and used for anything else, such as childcare or travel expenses, are completely disregarded.
 
1     ESA Reg 138 ESA Regs
HB Reg 65 HB Regs
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Payments before a course starts or before a loan is paid
A payment from the discretionary fund made before the course starts is always ignored as income even if it is for living costs. A payment made before you get the first instalment of your student loan, if it is intended to tide you over until your loan is paid, is ignored as income.
Other payments
Voluntary or charitable payments
Regular voluntary or charitable payments are ignored for income-related ESA and HB. If paid as a lump sum, the payment is taken into account as capital whatever it is intended for.
5. Earnings
Your earnings and your partner’s earnings are taken into account in the benefit assessment. Your net weekly earnings are taken into account – ie, after deducting:
    •income tax;
    •class 1 national insurance contributions;
    •half of any contribution you make towards a personal or occupational pension.
Some of your earnings are disregarded. Of the following, the highest disregard(s) that applies in your circumstances is deducted from your earnings:
    •£25 for lone parents claiming housing benefit (HB);
    •£20 for those who get a disability premium;
    •£20 for those who get a work-related activity or support component in their HB applicable amount. For those on HB doing permitted work and getting certain other benefits, the disregard can be higher;
    •£20 for income-related employment and support (ESA) claimants. This disregard can be higher for those doing permitted work;
    •£20 for those who get a carer premium;
    •£20 for part-time firefighters and some other emergency auxiliaries;
    •£10 for couples, whether one or both are working;
    •£5 for single people.
For example, if you are a lone parent who is also disabled, you have £25 disregarded for HB and £20 for ESA.
In some cases, for HB, childcare costs for registered childminders, nurseries and playschemes can be disregarded from earnings. Childcare costs of up to £175 a week for one child or £300 for two or more children are deducted from weekly earnings if you are:
    •a lone parent who is working; or
    •in a couple and both of you are working; or
    •in a couple, one of you is working and one of you is disabled (eg, gets a disability premium) or is in hospital or prison.
In each case, the work must be for 16 hours or more a week.
For HB, an extra £17.10 is disregarded if you work 16 hours or more and have a child or a disability or work 30 hours or more and are aged 25 or over (and in some other cases).
For full details of the way earnings are treated, see CPAG’s Welfare Benefits Handbook.
6. Benefits
Some benefits are taken into account in the assessment of income-related employment and support allowance (ESA) and housing benefit (HB). Other benefits are ignored or partially ignored.
Benefits taken into account in full include:
    •carer support payment;
    •new-style jobseeker’s allowance;
    •contributory ESA;
    •incapacity benefit;
    •most industrial injuries benefits;
    •retirement pension.
Benefits completely disregarded include:
    •adult disability payment;
    •attendance allowance;
    •bereavement support payment;
    •Best Start grant;
    •carer’s allowance supplement and the young carer grant;1The Social Security (Scotland) Act 2018 (Consequential Modifications) Order 2018 No.872
    •child benefit;
    •child disability payment;
    •disability living allowance;
    •pension age disability payment;
    •personal independence payment;
    •funeral support payment;
    •Scottish adult disability living allowance;
    •Scottish child payment.
Benefits partly disregarded include widowed parent’s allowance – £10 a week is disregarded for income-related ESA, £15 a week for HB. You do not get this disregard in full if you already have £10 disregarded from a student loan or £20 disregarded from discretionary fund payments.
 
1     The Social Security (Scotland) Act 2018 (Consequential Modifications) Order 2018 No.872 »
7. Maintenance
Child maintenance payments are disregarded in full for income-related employment and support allowance and housing benefit.
8. Savings and other capital
There are limits on the amount of savings and other capital you can have and still claim benefit. These limits are described below. Some kinds of capital are not counted in the assessment. For details, see CPAG’s Welfare Benefits Handbook.
You cannot get income-related employment and support allowance or housing benefit (HB) if your savings or other capital are above £16,000.
If your capital is £6,000 or less, it does not affect your benefit at all.
If your capital is between £6,000.01 and £16,000, you are treated as though you have income from this capital of £1 a week for every £250 or part of £250 between these limits. This is referred to as ‘tariff income’. For example, if you have savings of £6,525, your tariff income is £3 a week.
These limits are different if you or your partner are over pension age. All your capital is ignored if you or your partner get pension credit guarantee credit. Otherwise, tariff income of £1 for each £500 or part of £500 between £10,000.01 and £16,000 is taken into account in the assessment of HB.