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Benefits and Tax Credits

Welfare Benefits

Part-time students and full-time students who are in a prescribed category for Welfare Benefits purposes may be eligible for certain Benefits and Tax Credits as well as their student funding e.g. Child Benefit and Universal Credit. More detailed information is provided below along  with links to and national finance advice charity Turn2Us.

Childcare Grants

Studying at university whilst bringing up children can be expensive. There are, however, a number of financial support schemes which could help you. There are different types of funding you can apply for depending on the course you are studying, your mode of study and the level of study (e.g. undergraduate or postgraduate). For more information on the funding available for different types of courses and types of study click here.

If you are a single, full-time student with no qualifying disability or dependants, you are excluded from claiming means-tested benefits throughout your course, including the vacation periods. 

If you are a student, you can claim University Credit if:

  • You are under 21, taking a course leading to a qualification at the same level as or below A levels (such as Scottish Highers, National Vocational Qualifications (NVQ) up to level 3) and you do not and cannot live with your parents; or
  • You are responsible for a child; or
  • You get Attendance AllowanceDisability Living Allowance (DLA)Personal Independence Payment (PIP)Adult Disability Payment or Child Disability Payment and you have limited capability for work.
  • You are over 66; or
  • You live with a partner who can claim Universal Credit; or
  • You have taken time out from your course for illness or caring responsibilities, are now recovered/your caring responsibilities have ended, and you are waiting to go back to your course.

If you are in receipt of a means-tested benefit, there will be elements of your student maintenance loan which will be taken into consideration when calculating how much Universal Credit you will receive. If you could get a Student loan for maintenance but do not claim it, your Universal Credit will be calculated as if you have been given the loan.

There are certain grants which are disregarded when calculating your Universal Credit claim; Disabled Students’ Allowance, Parents Learning Allowance and the Special Support Grant.

Students in receipt of the Special Support Loan have a larger amount of their student loan disregarded in their benefit calculation. 

You must report a relevant change in circumstances such as occupation, income, or relationship status, to your Benefits providers. These changes do not affect any non-means-tested Benefit e.g., DLA/PIP, but do reduce means-tested Benefits such as Housing Benefit and Income Support.

It is mandatory for means-tested Benefit (such as Housing Benefit) that you inform your Benefit provider of any new income e.g., Maintenance Loan.

Students who are already in receipt of disability benefits such as DLA/PIP or ESA (income-related) should be aware that non-taxable benefits do not affect your student funding application, nor does becoming a full-time student automatically disqualify you from receiving these benefits.

As full-time students are no longer looking for full-time employment, (irrespective of whether you are looking for employment alongside your course) you cannot continue to claim JSA.  There are some limited exceptions to this rule (see links below).

You may be able to receive Income Support during the long summer vacation (see links below), but your claim will be re-assessed when you notify DWP you are re-starting your full-time course, because of the student loan entitlement.  As above, the payment may be reduced to nil during term-time.

Full-time students are personally exempt from paying Council Tax and so you should contact your council as per their details on your bill to inform them.  If you are the only “liable person” resident in your home then your council tax bill will be reduced by 100% from the date you became a full-time student. If there is another liable person who is not also exempt then your bill will be reduced by 25%.

Pre-existing arrears will not be exempted!

See further information below:

Turn2Us - Benefit Guides

Disability Rights UK - FAQs

Gingerbread - Benefits and Tax Credits

England Shelter - Help with Rent

Benefit Advice Services - Newcastle

Tax credits are payments made by the UK government to support some people with low incomes. You can get tax credits as a full-time student, as long as you satisfy the usual eligibility criteria.  Most student income is ignored in the calculation. 

It is no longer possible to make a new claim for tax credits. If you are already receiving tax credits, you may be able to continue your claim. If not, you would need to make a claim for Universal Credit.

See further information below:

Turn2Us - Benefits and Tax Credits

Gov UK - Tax Credits

Money Advice Service - Tax Credits

Benefit Advice Services - Newcastle

Universal Credit is a payment to help with living costs which is paid monthly. UC is replacing a number of ‘legacy benefits’. These are:

  • Income support
  • Income based Job Seekers Allowance (JSA)
  • Income related Employment and Support Allowance (ESA)
  • Housing Benefit
  • Child and Working Tax Credits

Like legacy benefits, most students are not eligible to claim Universal Credit, though there are exceptions to this rule (see the links below).

For those who are eligible to claim Universal Credit as a full-time student, their student loan for maintenance will be taken into account in their benefit calculation.  (As above, the disregard for those in receipt of the Special Support Grant is higher than for those on the Maintenance Loan).

Currently existing benefit claimants who experience a change in circumstances while on legacy benefits will be naturally migrated to UC. Those claimants who have not migrated naturally will be moved over to Universal Credit in a process called 'managed migration'.  The main 'managed migration' is taking place now and is currently due to be completed by September 2024.

The government’s current plan is that existing benefit claimants will be moved over to Universal Credit in a process called 'managed migration'.  July 2019 saw the start of a small number of people being moved but the main 'managed migration' will take place from at least November 2020 onwards and is currently due to be completed by September 2024.

Anyone who has a change of circumstance requiring a new benefit claim will be moved via 'natural migration'.  This group of people will also lose their right to transitional protection which is only available for managed migrants to UC.

An example of a change of circumstances would be a student in receipt of Child Tax Credit and Housing Benefit making a new claim for Income Support over the summer vacation.

All of the ‘legacy benefits’ that a student was on previously would be cancelled, and the new single-payment Universal Credit would replace them. Once you have been migrated to UC, you can no longer go back to claiming legacy benefits.

Whether or not becoming a full-time student will prompt a ‘natural migration’ will depend on which legacy benefits you are claiming and the reason you are entitled to them. Your benefits provider will be able to confirm this. You must always inform HMRC, DWP or JobCentre+ of a change of circumstances.

If your circumstances allow you the option of maintaining your legacy benefits claim, you should seek advice to check if you will be better off before deciding to make a new claim for Universal Credit. If your income would decrease on Universal Credit, remaining on legacy benefits will give you transitional protection during a managed migration onto Universal Credit.

The child elements in Child Tax Credit and Universal credit are similar in value, but in some cases UC applies the two-child cap, so being permanently migrated to UC could see your income decrease depending on the number and birth dates of a child and when your claim commenced. Also, the impact of your other income e.g. student loan, wages etc. in means-testing Universal Credit is less generous than Child Tax Credit.

See further information below:

Turn2Us - Universal Credit

GovUK - Universal Credit

Entitled to - Universal Credit

Entitled to - Student Income and Universal Credit

Independent Advice - Newcastle

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