Hb, council tax benefit and self employment

dollydo

Hi,

Hoping you guys can give me some advice please.

Just started receiving housing benefit and council tax benefit ( due to husband leaving). I have since found a new house to rent, as its cheaper and will give me and my child a fresh start.

I have an overlapping period of 2 weeks where new tenancy starts and old one finishes. I plan to take the 2 weeks to move myself in. Will the council be ok with this?

And secondly ive been offered some self employment work of about 16 hours a weeks - only paying between £250 and £300 per month, but I want to do it properly and register with the tax office. I know i need to tell the council too and this will effect how much i get in hb and council tax, but not by much i hope. I will also get working tax credit too then ( fingers crossed). But will they stop my hb while they wait for documentation regarding self employment.

My thoughts were to register with the tax office, then tax credits and then council ( all on same day) but i think i will have to wait for documentation to come through. But i cant afford to lose any benefit as i will be moving and every penny counts!

Also what is required to be shown as self employment. I will be working for a family member who lives abroad, doing admin work as they do consultancy. I can invoice them and they will pay direct into my account. Will this be ok?

Thanks for any advice.

Dolly x

Duncombe

You are right in that you will need to register with HMRC as a self employed person. Be sure to keep really good records of your employment though - you'll need to show everything is legit when you fill in tax returns

Also, im not sure, but you can't register for WTC until you've actually started working as self employed and can demonstrate you are working 16 hours a week. Could be abit long and drawn out until you have proof of your earnings/working patterns.

Benefits_Bod

dollydo wrote: »

I have an overlapping period of 2 weeks where new tenancy starts and old one finishes. I plan to take the 2 weeks to move myself in. Will the council be ok with this?
Dolly x

There are two separate overlap provisions under HB legislation where there are two liabilities for the same period.

Under the first, you must move in on the day the tenancy starts AND the dual liability must be one that could not reasonably have been avoided.

Under the second, this covers situations where there is a period of liability on the new property before you actually move in. For this to apply, the reason for the delay in moving in must be due to necessary adaptations being made for the disablement needs of yourself or a family member. If the delay is for any other reason, no overlap is payable (although you might be lucky and get a LA that doesn't understand this part of the legislation).

dollydo wrote: »

And secondly ... self employment work of about 16 hours a weeks -

Notify them all. Because it is a new business, HMRC (Tax Credits) and the council (HB/CTB) will have to rely on a projection. The council will almost certainly ask you to complete a pro-forma "guestimating" what you expect to earn in the first 3 / 6 months. At that time, you may also be asked to confirm the level of business - details of gross income and all expenses will be asked for (probably by way of a pro-forma). As a sole-trader, there is no requirement for you to produce formal accounts, but I would strongly advise that you keep comprehensive records for ease of reference (e.g. a spreadsheet showing income / expenses).

If you find your income is significantly higher, or lower, than the earnings estimate given, notify both HMRC and the council. Bear in mind that if you tell the council of a change more than one month after it happens and it increases your HB/CTB, you may find the increased benefit only takes effect from when you notify the council.

NB: Anyone self-employed must register this with HMRC within 3 months of being self-employed - this is a different section to the one dealing with Tax Credits.

dollydo

Thanks for your response guys.

Regarding the liability of the rent. I have saved enough to pay the rent on both properties for the overlap time, but more concerned about the council tax. The overlap cant be helped as my current tenancy doesnt run out until the middle of the month and the new can only be started on the 1st of the month.

What exactly will the council do? Im sort of new to all of this and at the grand age of 40, finding myself claiming benefits for the first time.

Thanks again for your help.

x

Benefits_Bod

There is no provision for overlapping council tax benefit. However, thinking logically, there shouldn't be two concurrent liabilities as you will be living in one, or the other, not both.

Also, any overlapping HB will be much more beneficial financially - I would advise you move as much in on the first day of the new tenancy and stay at the new address overnight. That will normally be enough to count as having moved. I wouldn't hesitate to ask the council for overlapping HB - it is your legal right to ask for it and the worst the council can do is say "no". Be aware, it is not a discretionary provision, so if the council says it won't pay for a reason such as "we don't pay in these circumstances", appeal! The council can only refuse to pay if the dual liability could reasonably have been avoided or, if you move in late, the delay wasn't for disablement needs adaptations.

dollydo

Thank you. I think thats what i shall do. I will move in on the day of the new tenancy with as much stuff as i possibly can ( might have to venture back to the old house to pick up a few remaining bits) and hope that the hb and ct benefit will just be classed as a change of circumstances once i produce the new lease.

Thank you for your help.

x

Benefits_Bod

dollydo wrote: »

...and hope that the hb and ct benefit will just be classed as a change of circumstances once i produce the new lease.

A change of address is, legally, just a change of circs for HB/CTB purposes (unless the two addresses fall in different council areas).

However, many LAs ask for a normal claim for to be completed as it's the easiest way to obtain information about the new property. My advice is to go with the flow (unless you happen to know benefits legislation and feel inclined to give your local council a bit of a runaround ). Er, if you don't know the legislation - go with the flow!