Students: Loans
The question
To ask the Secretary of State for Education, whether her Department has made an assessment of the potential (a) merits of calculating maintenance loans through net rather than gross household income and (b) impact of that change on single parental income households.
Answered by Josh MacAlister
Entitlement to partially means-tested undergraduate loans for living costs is based on the income of the student’s household.
The income used is the total income on which a person is charged income tax at step 1 of the calculation in Section 23 of the Income Tax Act 2007, before the deductions made by HMRC from step 2 onwards of Section 23.
The use of income charged to tax in the household income assessment applies a standard measure of income to calculate a student’s entitlement to living costs support and allows all students to be assessed consistently and fairly. It also ensures that the most support is paid to students from the lowest income families, including those with single parents, who need it most and who are historically under-represented in higher education. It is not intended to be an exact calculation of disposable income for each household.
Information on income is available from HMRC and allows around 1.3 million assessments a year to be carried out quickly and efficiently each year by Student Finance England.
Maximum grants and loans for living and other costs for the 2025/26 academic year have been increased by forecast inflation, 3.1%, based on the RPIX inflation index.
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