I intend to take the maximum student loan available outside London but how will this affect my income support (IS) and severe disablement allowance (SDA)?
A2. If you are a first year student your maximum loan if you study outside of London should be £4,950. This loan will affect the amount of IS you receive as most, but not all of it, will be treated as income. The benefit rules allow you a certain amount for travel costs, books and equipment (for the 2009/2010 year these amounts are £303 a year for travel costs and £390 a year for books and equipment). Once this amount has been deducted the remaining loan is divided over 42 or 43 weeks, depending on the total number of term weeks. Of this weekly figure £10.00 a week is disregarded and the rest counts as income and reduces your IS on a pound for pound basis. The SDA you receive will not be affected by your loan. However the fact that your IS includes SDA may affect your IS entitlement. You may lose this IS entitlement when you get your loan if the amount of IS you receive to top up your SDA is less than your weekly loan.
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