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.
Example
Julie is 25 and a full-time, second-year undergraduate student and a lone parent of Penny, aged three and Sam, aged six. She gets a student loan of £7,100, 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 £35.10 a week, child tax credit (CTC) of £123.20 a week, and personal independence payment (PIP) of £61.85 a week.
During the academic year September 2022 to June 2023:
Step one Julie has no savings or capital.
Step two Her applicable amount is:
Personal allowance for herself £77.00
Disability premium £36.20
Severe disability premium £69.40
Total applicable amount £182.60
Step three Her weekly income is:
Loan and independent students’ bursary £166.36
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. Her independent students’ bursary also counts in full. Child benefit, CTC and PIP are disregarded.
Step four Her income is £16.24 below her applicable amount, so she can get IS of £16.24 a week from September 2022 to June 2023.
During the long vacation from June 2023 to September 2023:
Step two At 2022/23 rates, Julie’s applicable amount is £182.60 (as above).
Step three Her weekly income for IS purposes from the end of June 2023 to the beginning of September 2023, 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 2023 to the beginning of September 2023 her weekly IS is £182.60. Julie’s IS should increase from the end of June.