JSA entitlement?

Amanda65

Hi all

OH was made redundant on 10th April so is 'officially' unemployed as of this month. He is trying to set up on his own as a consultant in his field but it is obviously going to take a few months before the money (hopefully) starts rolling in.

Is he entitled to 'sign on' while starting up on his own? He has always worked as an employee so would be entitled to contribution based JSA but isn't sure if he would receive it while starting up a business. He phone the DWP last month and the woman he spoke to was so rude and condescending and told him to phone back 'when he actually didn't have a job' that he is loathe to call again and says he's rather not claim :eek:. I'm concerned not only about how we will cope financially but also a potential gap in his NI contributions, which I believe are met is you receive JSA.

I work full time and we have 3 children, although the eldest is at university, the middle one will go in September and the youngest is 15. I phoned tax credits and based on my salary we are apparently only entitled to £550 pa :cool:.

He is also applying for full time work and if a good job came up he would fold the consultancy and take it.

Thanks

Amanda

Andyboy

http://forums.moneysavingexpert.com/showpost.php?p=43362646&postcount=2

took this from redundancy board for you. Hope it helps.

I am between jobs ad undecided on what to do.

Good luck

Amanda65

Thanks Andy - will look into that but until he can get on a course can anyone advise whether he can claim benefits ?

terryw

To claim Jobseeker's Allowance, you must either not be working at all, or working less than 16 hours a week. Providing that he informs the JC of the hours that he works and any money received, there should be no problem. Attempting to obtain consultancy work would fall into the category of "looking for work".

sebastianj

Don't think Amenda got her answer,
IMO he should claim and will get benefits unless household savings are not over the limits. He will also be entitled to help with any courses, he needs to go in and talk about what he wants to do. His NI will be paid and you will also be entitled to council tax benefits.
If he does not sign on, He will complicate things. Not claiming benefits sounds good but the system does not appreciate it.

seb

Amanda65

Thanks Seb

I will get him to call tomorrow. I work 30 hours a week and receive a good salary but unfortunately not enough to cover all out outgoings (and yes we are cutting back etc ). I phoned the tax credits people and was told we would get £10.29 per week which really doesn't seem worth claiming as when he starts earning this tax year we'll just have to pay it back!

Amanda

allen35

sebastianj wrote: »

Don't think Amenda got her answer,
IMO he should claim and will get benefits unless household savings are not over the limits. He will also be entitled to help with any courses, he needs to go in and talk about what he wants to do. His NI will be paid and you will also be entitled to council tax benefits.
If he does not sign on, He will complicate things. Not claiming benefits sounds good but the system does not appreciate it.

seb

Not very good!

Why would they be entitled to Council Tax benefit (What have you based this on)

He will get benefits (Not if he works 16 hours or more whilst starting his business)

Entitled to help with courses ( Why would he be, this normally is based on household income and he may receive a discount due to it being contribution based and not income based he will be applying for)

I would advise to claim tax credits and put them in an account until you are sure you may have been overpaid. if OH does start earning you can then inform HMRC of the COC and they will ammend your claim.

You cannot be sure what life throws at us and eventually if your income doesn't improve you can only request 3 months backdated benefit.

Amanda65

Thanks Allen

I didn't think we would get council tax benefit I must admit as I earn over the threshold. He has applied to some courses etc. that are run by local start - up advice schemes but can't get on them yet. These are free so maybe that is what Seb is referring to.

The 16 hours per week is a bit confusing - he is doing way beyond that a the moment contacting prospects, marketing etc. but isn;t actually earning yet so we are in a bit of a catch 22. If he doesn't work over 16 hours, he'll never get any work, but if he does he can't claim any benefits. Think we may well be between a rock and a hard place

WPN

Your problem is you are a genuine family who is over cautious of accidently ripping off the taxpayer - which is admired.

You need to stick your needs first - you need an income AND you need to look at it from the point of view of a prosecutor... would you be liable to benefit fraud? Sadly Jobcentre Plus policy varies upon District and JCP office - laws can be strongly followed in one office but overlooked in another. If you can see from another person's perspective that you would not be liable for such crime you should be more relaxed about the whole thing. To be prosecuted for benefit fraud there was to be an element of strongly knowing you aren't entitled to the money rather than the more relaxed "not sure" because of conflicting information. You would have to deliberately knowingly mislead them to be liable.

Now we have that out of the way... it is rather a tricky subject. My personal bet is that in addition to setting up a business (I assume not as self-employed?) that he meets the "Actively Seeking Employment" requirement by seeking work in addition to his ambitions. Not only are you filling the requirement it also creates a safety net - getting a job in the meanwhile would be better than JSA anyway and would give more freedom to set up his business how he likes.

The tricky issue is whether he is going self-employed or as an employee (of say a limited company). If the latter, he is a common law official of the business (if he becomes a director) and until he comes onto the payroll (or any other income from said business) he is entitled to claim benefits. So he could spend 18 hours a week setting up his business as long as he isn't doing it as an employee. To complicate things, he must be "Available for Work" which is why typically doing work over 16 hours a week makes you not eligible to claim (unless its workfare of course). It depends on the Jobcentre but as a rule of conduct I advise him not to spend more than 15 hours working on his business - although its unlikely they would discover any additional - it could be seen as deceptive to claim whilst exceeding this limit.

What is complicated is JCP staff are not cut out for this - only stereotypical dole goers. You will find it extremely difficult talking about directorships and shares - as they will assume you are defrauding the system. As a rule of thumb if he sets up a limited company taking the founding share... do NOT disclose it. The application forms talk of shares in the sense of capital of owning many Plc shares - thats stock market etc. They do this to work out capital. If you own a founding share not paid up, at £1, with a business of a zero bnalance sheet (in the meanwhile) he has a zero valued asset. 1 share of nothing is nothing. Was he thinking of being self-employed?

sebastianj

WPNtoday, you have hit the nail on the head.
They may get single person discount on CTB if he signs on, depending on their status.
Dreaming to get rich or may make a lot of money, does not help the statuscoa. As long as they are honest about the information provided, it should suffice. The moment money starts rolling in, they should notify change in circumstances.
seb