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 end of the term in which you leave. The end of term is taken to be the end of December if you leave in the autumn term, the end of March if you leave in the winter term, the end of June if you leave in the spring term and the end of August if you leave in the summer.
The amount of loan taken into account is that which remains from the loan that was paid from the start of the standard academic year (eg, 1 September for students whose courses begin in the autumn – see
here) to the end of the term in which you left, having subtracted that part of the loan (including disregards for books, equipment and travel) that would have been treated as your weekly income in a normal benefits calculation up until the day you left.
1IS Reg 66A(2)(aa) IS Regs
JSA Reg 136(2)(c) JSA Regs
ESA Reg 137(3)(e) ESA Regs
HB Reg 64(2)(b) HB Regs The example below illustrates how this amount is calculated.
2IS Reg 40(3A) IS Regs
JSA Reg 103(5) JSA Regs
ESA Reg 104(4) ESA Regs
HB Reg 40(7) HB RegsExample
Nick studies in Birmingham. He abandons his course on 1 November 2021. He is in the second year of a three-year course and is claiming HB. His benefit week starts on a Monday.
Work out weekly amount of annual loan
Loan £6,801
Less disregards (£693) = £6,108
Divided by 42 weeks = £145.43
Work out amount of loan prior to leaving the course
Multiply the weekly amount of annual loan by the number of benefit weeks from the week after the one that includes the start of the academic year until the end of the benefit week that includes the day Nick left the course.
Multiply weekly loan (£145.43) by nine weeks
(6 September to 7 November 2021) = £1,308.87
Work out amount of loan since leaving the course
To do this, add the loan instalments paid for the terms up to the one in which Nick left, deduct disregards and deduct the loan worked out for the period prior to leaving.
Loan up to end of term (33% x 6,801) = £2,244.33
Less disregards (£693) = £1,551.33
Deduct amount of loan prior to leaving (£1,308.87) = £242.46
Work out weekly amount of loan from leaving course to end of term
Divide the total amount of loan for the period since leaving the course by the number of weeks left in the term. Count from the benefit week that includes the day Nick left the course until the benefit week that includes the end of term – ie, end of December, March, June or August.
Divide £242.46 by eight weeks (1 November 2021 to 26 December 2021) = £30.31
£30.31 a week is taken into account from 1 November 2021 until 26 December 2021.
If you leave your course nearer to the end of term, this formula could result in there being no loan income taken into account for the remainder of the term.
Note: if you repay the loan, it is nevertheless taken into account as income until the end of term.
3See also HB/CTB Circular A31/2001 Part 6 and Annex D for guidance and a sample calculation, together with HB/CTB Circular A39/2001, para 19 So you could be refused benefit despite having no other money to live on. However, if your funder asks you to repay the loan rather than your repaying it voluntarily, guidance tells DWP decision makers to disregard the loan as income from the date of the request.
4CJSA/549/2003