Just thought I would share this info. Have applied for DD's SF which was based on 11/12 household income. DH is self employed and had a one off high income that year and so the loan is quite low. I was aware that we could appeal if we expected the income to drop more than 15% in the tax year 13/14, which we do. However, at the time, they told me that once the appeal has been accepted and the loan is recalculated based on an estimate of 13/14 income, next years award will also be based on 13/14 (as this will be the most recent income info they hold) and not 12/13 as will be the case otherwise. Then in the third year, it will be based on 13/14 again as that will be the year used for all loans that year in any case. So, to sum up, if you are able to appeal, year 13/14 income will be used for all three years loan calculations.
The only thing to be aware of is that if you under-estimate your income for 13/14 and you earn higher, any overpayment will be deducted from your DC's loan next year. Likewise, if you over-estimate your income, any underpayment will be added to the loan next year.
Hope someone finds this info useful (and understandable! ) - I never realised until I telephoned