Full time students and benefits - How much Universal Credit will I get?

Universal Credit includes amounts for

• Basic expenses
• Housing costs
• Children
• Disabilities

Universal Credit will be calculated based on your income. This will include your income from student loans for maintenance and student grants.

Student income and Universal Credit

The following steps can help you to calculate:

Step 1 – Work out your total student income and take out disregarded grants. 

Step 2 – Your student loan for maintenance should be averaged out across the academic year. Work out how many months this will cover during the year of study.

Step 3 – Divide the amount of Step 1 by the amount from Step 2

Step 4 – Take out £110 from the amount in Step 3 and you can find out how much will be deducted for your student income when calculating your Universal Credit.

Students don’t get any work allowance before student income is deducted from Universal Credit.

Example

Katie gets a student loan of £10,800 in total. She has a 3-year-old child and gets Special Support Grant of £3,900. Year one of her course starts from 21 September 2020 to 17 May 2021. Her Universal Credit assessment periods run from 20th of the month to the 19th of the following month. 

Step 1: £10,800 - £3,900 = £6,900 (Her Special Support Grant is not counted as income for Universal Credit (see Student Income). 

Step 2: Katie's student loan counts as income for seven assessment periods .

Step 3: £6,900 ÷ 7 = £985.71

Step 4: £985.71 - £110 = £857.71 

Katie's Universal Credit will be calculated based on income of £875.71 a month from 20 September to 19 April 2021. 

Post-graduate income and Universal Credit

Universal Credit will be calculated based on 30% of the maximum postgraduate or postdoctoral loan.

If you fail to apply for the maximum postgraduate loan you’re entitled to, it will usually be treated as if you get the loan and your Universal Credit will be calculated on that amount.

The following steps can help you to calculate:

Step 1 – Calculate the 30% of the postgraduate loan.

Step 2 – Your postgraduate loan should be averaged out across the academic year. Work out how many months this will cover during the year of study.

Step 3 – Divide the amount of Step 1 by the amount from Step 2.

Students don’t get any work allowance before student income is deducted from Universal Credit.

Example

Hassan gets Universal Credit and his full-time postgraduate master’s degree starts on 12 September 2019. His Universal Credit assessment periods run from 8 September 2019 to 7 May 2020. The course will last for one year and he gets a postgraduate master’s degree loan of £10,000.

Step 1: £10,000 - £7,000 = £3,000.

Step 2: Hassan’s loan counts as income for seven assessment period .

Step 3: £3,000 ÷ 7 = £428.6

Hassan’s Universal Credit will be calculated based on income of £428.6 a month from 8 September 2019 to April 2020.

The Department for Work and Pensions (DWP) will not usually give detailed information on how your student income has been calculated, and this is a complicated area where the DWP makes mistakes. If you are getting student income and Universal Credit, it would be a good idea to get help from an adviser to see how much should be deducted from your Universal Credit.

Updated: January 2023