New Enterprise Allowance scheme - My story

WantToBeSE

I have finally have some interest from the JC. I told my advisor that i was definitely interested in the NEA scheme, and he has made an appointment for us to talk about it next week. He explained how the scheme works, but didnt know answers to all of my questions, so i hope you dont mind me asking you guys?

Do i get the weekly allowance regardless of how much i earn that week? So, say for example, 1 week i earn £20, and another week i earn £120, do i still get the allowance on both of those weeks?

What is taken into account for housing benefit and council tax benefit purposes?

How do i 'prove' the number of hours i have worked, and the pay i received, for the HMRC?

rosered1963

WantToBeSE wrote: »

I have finally have some interest from the JC. I told my advisor that i was definitely interested in the NEA scheme, and he has made an appointment for us to talk about it next week. He explained how the scheme works, but didnt know answers to all of my questions, so i hope you dont mind me asking you guys?

Do i get the weekly allowance regardless of how much i earn that week? So, say for example, 1 week i earn £20, and another week i earn £120, do i still get the allowance on both of those weeks?

What is taken into account for housing benefit and council tax benefit purposes?

How do i 'prove' the number of hours i have worked, and the pay i received, for the HMRC?

Hello.

Enterprise Allowance is a fixed allowance and does not have anything to do with the hours worked or profits you make during the award. You do have to turn up at the jobcentre by appointment to prove you are actually trading once the allowance is awarded to you. You take along things like invoices, work diary etc to prove that.

Regarding Council Tax Beneift and Housing benefit. You provide them a forecast of what you expect to earn. This will be an estaimate of-course, and will be part of your business plan - your cashflow forecast. Enterprise Allowance does not count as income for Housing Benefit purposes. I was told by my jobcentre advisor that I would receive some housing benefit while my busness was getting up and running. However, my Housing Benefit claim has been suspended and I have received no benefit at all since I told them about my Enterprise Allowance and self-employment. They have never heard of the Enterprise Allowance Scheme. I have had to borrow money to pay my rent. They are still messing about with my claim months later.

You need to keep some form of accounts from the day you actually start self-employment. It depends what the nature of your work is as to what accounts you need to keep. You won't actually start self-employment until your business plan has been written and accepted (see my earlier posts on this thread). The writing of a business plan is a big job. Enterprise Allowance is not awarded until they are sure that you have a viable and new business idea.

Good luck. I have kept my head above water only through borrowing money from my family to pay our rent. If I had children to feed, it would have been horrendous. We couldn't have managed. You can't rely on your Housing benefit being sorted out in a timely way. My Council is months behind.

Looking back on this experience, it has been a massive amount of work, effort and stress. I would not to choose to do it again. However, I live in an area of the highest unemployment in England, and it was either go self-employed or nothing.

Theoretically, once you are self-employed, you can apply for working tax credits. I'm not going down that road myself, but you can do.

Good luck

WantToBeSE

Thanks rosered-i am slightly nervous. I have 2 children to feed, and nobody at all to borrow money from, should i need to.

Ziggy_Stardust

WantToBeSE wrote: »

Thanks rosered-i am slightly nervous. I have 2 children to feed, and nobody at all to borrow money from, should i need to.

Good luck I hope it all goes well. Are you able to claim tax credits? DH keeps a record of all the hours he works for the business this includes time spent visiting shops to place ads in the windows, visits to the library for books and researching on the internet for marketing ideas and resources to help him so make sure you count these hours as work.

WantToBeSE

Thanks Ziggy,
I should imagine that I could get TCs, as long as I am working over 16 hours, which I definitely plan on doing (at LEAST).

Ziggy_Stardust

WantToBeSE wrote: »

Thanks Ziggy,
I should imagine that I could get TCs, as long as I am working over 16 hours, which I definitely plan on doing (at LEAST).

You will be surprised at how much the hours add up, anything involved with the business should count .

rosered1963

WantToBeSE wrote: »

Thanks rosered-i am slightly nervous. I have 2 children to feed, and nobody at all to borrow money from, should i need to.

Good luck and do your research - read up on everything you can related to your business. Don't charge too cheaply or try to undercut others. That's how people fail. Your expenses will be higher than you might think. I had to do a level 2 business course 2 days a week for 8 weeks run by the local enterprise agency - it was a condition for the Enterprise Allowance in my area. All areas are different. If you can do it, I would - it shows you the reality of being self-employed.

Re Tax credits: Remember than HMRC have been cracking down on anything that they consider to be a "hobby" business. The reason for this is that some people are going self-employed so that they don't have to sign on. I have read elsewhere on this forum that in the near future, HMRC will consider anyone s/e as having an income equivalent to working full-time on the minimum wage when they assess tax credits. I don't have children so don't know about child tax credits. Suggest you look into it.

Best of luck.

Ziggy_Stardust

rosered1963 wrote: »

Re Tax credits: Remember than HMRC have been cracking down on anything that they consider to be a "hobby" business. The reason for this is that some people are going self-employed so that they don't have to sign on. I have read elsewhere on this forum that in the near future, HMRC will consider anyone s/e as having an income equivalent to working full-time on the minimum wage when they assess tax credits. I don't have children so don't know about child tax credits. Suggest you look into it.

Best of luck.

It's a minefield, if only they'd give T&Cs it would make things clearer, DH called up and was just given the one page which you had. Our children are grown up now so there's no CTC for them but he is working on the business at the moment and trying to build it up, we want to be self-sufficient as soon as possible, he's a very proud man.

rosered1963

:money:

Ziggy_Stardust wrote: »

It's a minefield, if only they'd give T&Cs it would make things clearer, DH called up and was just given the one page which you had. Our children are grown up now so there's no CTC for them but he is working on the business at the moment and trying to build it up, we want to be self-sufficient as soon as possible, he's a very proud man.

Good luck to your husband. I think the tax credit thing is a complete mess. And if you're self-employed and can't predict your earnings, it stumps the benefit and tax credit system - it doesn't matter whether you are entitled to help - they don't seem to know their own rules. I have had to print bits off their own websites and show them regardin Enterprise Allowance. I am just working as hard as possible to be self-sufficient - it will happen in June.

Good luck to everyone on this tough road

BigAl127

How long did it take for others to receive their NEA payments?