Step four: deduct weekly income from applicable amount
If your income is less than your applicable amount, IS equals the difference between the two.
If your income is the same as or more than your applicable amount, you cannot get IS.
Nora is 23 and a full-time, second-year undergraduate student and a lone parent of Penny, aged two. She gets a student loan of £6,750, plus an independent students’ bursary of £1,000, £1,305 lone parents’ grant and £1,215 for childcare. Her only other income is child benefit of £21.15 a week, child tax credit (CTC) of £54.60 a week, and personal independence payment (PIP) of £60 a week.
During the academic year September 2021 to June 2022:
Step one Nora has no savings or capital.
Step two Her applicable amount is:
Personal allowance for herself £74.70
Disability premium £35.10
Severe disability premium £67.30
Total applicable amount £177.10
Step three Her weekly income is:
The childcare grant and lone parents’ grant are disregarded. Her loan (less certain disregards) is divided over the 42 weeks of the academic year (see Chapter 17), and a further £10 disregarded. Child benefit, CTC and PIP are disregarded.
Step four Her income is £19.08 below her applicable amount, so she can get IS of £19.08 a week from September 2021 to June 2022.
During the long vacation from June 2022 to September 2022:
Step two At 2021/22 rates , Nora’s applicable amount is £177.10 (as above).
Step three Her weekly income for IS purposes from the end of June 2022 to the beginning of September 2022, is nil. This is because her loan only counts as income during the academic year. Child benefit, CTC and PIP are disregarded.
Step four From the end of June 2022 to the beginning of September 2022 her weekly IS is £177.10. Nora’s IS should increase from the end of June.