My client last attended uni in Nov 07 and hasn't returned due to ill health. IS being paid at reduced rate as taking into consideration £2700 instalment of student loan paid Jan 08. Withdrew from course end Jan and so Student Loans Co now want return of last instalment saying it was overpaid.

JSA taking loan into consideration for IS purposes but I wasn't sure how it should be treated as he's supposed to be repaying it immediately.

What do you think ?

Have a look at CIS/4201/2003 this, follows Leeves (R(IS) 5/99 -see quote below) and says that once SLC have asked for an overpayment to be repaid it ceases to be income. This was not of much use to the appellant in that case, but it should help your client on the facts you give. My only query is whether the changes in Student Loans rules since 2001 might affect the position, but I doubt it.

From Court of Appeal decision in Chief Adjudication Officer v. Leeves R(IS) 5/99:

“On the other hand, it seems to me that, following demand made by the Hampshire County Council in its letter of 24 May, at which point the claimant became under an obligation of immediate repayment in respect of his grant, that part of the claimant’s grant required to be taken into account over the weeks which followed under regulation 29 thereby lost its character of “income” on any ordinary understanding of the word.”

Tue 20-May-08 11:21 AM by suelees

Very nice one Paul thanks