The rules for the new Postgraduate Loan are quite specific and specify a set amount of the loan (30%) to be treated as income as per the Statutory Instrument 2016 No. 743 (page 3) that came into force on 4 August 2016.

http://www.legislation.gov.uk/uksi/2016/743/pdfs/uksi_20160743_en.pdf (see page 3)

http://www.legislation.gov.uk/uksi/2006/213/contents/made
http://www.legislation.gov.uk/uksi/2006/213/regulation/59/made
http://www.legislation.gov.uk/uksi/2006/213/regulation/63/made
http://www.legislation.gov.uk/uksi/2006/213/regulation/64/made

[(2) In regulation 53(1) (students: interpretation), after the definition of “periods of experience” insert— ““postgraduate master’s degree loan” means a loan which a student is eligible to receive under the Education (Postgraduate Master’s Degree Loans) Regulations 2016;”.

(3) In regulation 59(3) (calculation of grant income)— (a) after “a student loan” insert “or a postgraduate master’s degree loan”; (b) for “such a loan” substitute “a student loan or a postgraduate master’s degree loan. [applied to the below]


(3) Where a student does not have a student loan and is not treated as possessing such a loan, there shall be excluded from the student’s grant income— (a) the sum of £280 in respect of travel costs; and (b) the sum of £352 towards the costs of books and equipment, whether or not any such costs are incurred.

(4) In regulation 64 (treatment of student loans)—

(a) at the end of the heading add “and postgraduate master’s degree loans”;
(b) in paragraph (1), after “A student loan” insert “and a postgraduate master’s degree loan”;
(c) in paragraph (3)— (i) after “a student loan” in both places, insert “or a postgraduate master’s degree loan”; (ii) in sub-paragraph (b), for “such a loan” substitute “a student loan or a postgraduate master’s degree loan”.
(d) after paragraph (4) insert—

“(4A) Where a student is treated as possessing a postgraduate master’s degree loan under paragraph (3) in respect of an academic year, the amount of that loan to be taken into account as income shall be, subject to paragraph (5), a sum equal to 30 per cent. of the maximum postgraduate master’s degree loan the student is able to acquire in respect of that academic year by taking reasonable steps to do so.”.

(5) After regulation 64A(a) insert—

...end

The rules for the new Postgraduate Loan are quite specific and specify a set amount of the loan (30%) to be treated as income as per the Statutory Instrument 2016 No. 743 (page 3) that came into force on 4 August 2016.

http://www.legislation.gov.uk/uksi/2016/743/pdfs/uksi_20160743_en.pdf (see page 3)

http://www.legislation.gov.uk/uksi/2006/213/contents/made
http://www.legislation.gov.uk/uksi/2006/213/regulation/59/made
http://www.legislation.gov.uk/uksi/2006/213/regulation/63/made
http://www.legislation.gov.uk/uksi/2006/213/regulation/64/made

[(2) In regulation 53(1) (students: interpretation), after the definition of “periods of experience” insert— ““postgraduate master’s degree loan” means a loan which a student is eligible to receive under the Education (Postgraduate Master’s Degree Loans) Regulations 2016;”.

(3) In regulation 59(3) (calculation of grant income)— (a) after “a student loan” insert “or a postgraduate master’s degree loan”; (b) for “such a loan” substitute “a student loan or a postgraduate master’s degree loan. [applied to the below]


(3) Where a student does not have a student loan and is not treated as possessing such a loan, there shall be excluded from the student’s grant income— (a) the sum of £280 in respect of travel costs; and (b) the sum of £352 towards the costs of books and equipment, whether or not any such costs are incurred.

(4) In regulation 64 (treatment of student loans)—

(a) at the end of the heading add “and postgraduate master’s degree loans”;
(b) in paragraph (1), after “A student loan” insert “and a postgraduate master’s degree loan”;
(c) in paragraph (3)— (i) after “a student loan” in both places, insert “or a postgraduate master’s degree loan”; (ii) in sub-paragraph (b), for “such a loan” substitute “a student loan or a postgraduate master’s degree loan”.
(d) after paragraph (4) insert—

“(4A) Where a student is treated as possessing a postgraduate master’s degree loan under paragraph (3) in respect of an academic year, the amount of that loan to be taken into account as income shall be, subject to paragraph (5), a sum equal to 30 per cent. of the maximum postgraduate master’s degree loan the student is able to acquire in respect of that academic year by taking reasonable steps to do so.”.

(5) After regulation 64A(a) insert—

...end

The below refers to the new postgraduate student loan:

Dear Sam,

The question has been answered in your question and the regulations. 30% of any loan awarded will be treated as income.

Housing Policy Division

4. As in your example, if someone had earnings of £73.10 per week, equal to their Personal Allowance, the additional income from the loan would come to £9.21 per week (as detailed above). The Housing Benefit award would be reduced by 65% of any income above the Personal Allowance (termed Excess Income). So an Excess Income of £9.21 per week would reduce the Housing Benefit award by £5.99.

5. This is not correct. The income from the loan would be £9.21 per week (30% of £5,000 - £693 ÷ 42 weeks =£19.21. Minus £10 disregard).

The income is not calculated from 1 April 2016 to 31 March 2017 or 52 weeks. It is calculated based on the period of study.


Regards

Karen Way
Contracts Manager
Revenues and Benefits
City Treasurers

1. If the loan were to be £5,000 in one year, with a further £5,000 for the year 2, the income from the loans would be 30% of the loan, £1,500. This would be apportioned in the same way previously explained, for the period relating to the period of study. So a course commencing in September 2016, and with a holiday term in the summer term, a weekly income from the £1,500 would be calculated using the number of weeks from the first full benefit week in September to the last Sunday in July 2017. In this case that would be September 2016 to 25th June 2017 which is 42 weeks. From the £1,500 we would deduct £303.00 for travel costs and £390.00 for books and equipment. This would leave £807.00 to apportion over the 42 week period at £19.21 per week. This amount would be further reduced by the £10.00 weekly disregard, to £9.21 per week.

2. The loan would not be treated as earnings, but as income. This would be applied for the period of study, so if the course commenced on 14th September 2016, we would apply this income from the following Monday, 19th September 2016 up until Monday 26th June 2017. The income for the second year would be applied from the first Monday in September 2017, and would then be removed from the Monday following the completion of the course.

3. Are the disregards of £10 per week plus £632 per annum for each year of the course? So is a total of £22pw disregarded from earnings each year? [Regulation 64(5)and regulation 64(2)]


3. The £10 disregard will be applied for the period of study, not for the whole year. Therefore if the period of study was calculated as a 42 week period the £10 disregard would be applied for those 42 weeks only. The disregard for Books and Travel, totalling £693 would be applied for each year of study.