New Enterprise Allowance scheme - My story

forheavyrotation

Apologies if this has been covered...I have looked!

Why can't someone on the Work Programme go on the NES?

Andy2013

Don't know as they cant, personally not heard so best ask your JC to get the best answer.

Work programme is usually a last resort and a way to make JSA claimants sweat.

NEA is only available if you are serious and have a genuine , feasible business idea that has hope.

TrueBlue1965

You cannot go on NEA if your already on the Work Programme because the Government has deemed that those on the Work Programme are already getting help. You cannot be on two schemes at the same time.

Neanovicetobe, you need to work 100% on your business or forget NEA and the loan.

Im now 6 weeks in to trading while on NEA. Its a great feeling to get up in the morning and start working on my future.

I had my 6 week check on my business at JCP on Monday. It was just a simple look at my books and a well-done from the job centre member of staff.

I,ve has a relatively good experiene on the pre NEA programme. 6 workshops. Regular mentoring even if most of it was to keep me motivated. I,ve had a few problems but i,ve taken control and pushed the right people if they where not doing what was expected of them. I think you have to take control of your life if you want your business to work.

Andy2013

Exactly right, its down to us to make this work, no one else is to blame if it fails, great to see its working for you TrueBlue1965 , your clearly one of the exceptions with a positive ish NEA experience, keep pushing that business.

D4VE

I've read this thread with great interest. Thanks everyone.

I've had 2 appointments with my NEA provider, and have a 3rd to go through my Business Plan at the beginning of Feb. I will be setting up a Ltd company, and be the sole Director.

I have completed my BP, and would be ready to start trading within a week of it being approved AND receiving the loan - which is a major hurdle as I have a poor credit history. Has anyone with a very poor credit history been approved for this loan ?

Seeing the problems some people have had, I will let the JCP know that I don't want to waste time chasing them or anyone else for money as that will really P... errr annoy me, when I'm supposed to be working.

I'm also unsure at present how any 'earnings' will affect my Housing Benefit (HB).

I need to take £50/week from the company to make up the shortfall between what I receive now and the £65/week NEA payment, then £100/week after the 13th week.

Do I need to inform HB of this? If so, one idea I have is for me to lend the Ltd company the £2,500 and then class these £50 and £100 amounts as the company repaying the loan to me, so effectively I won't be 'earning' anything for 6 months. Is this viable?

This_Year

It is worrying that there is still such little knowledge in JCP about NEA and the obvious questions that people have about it. Most of what I know I have gleaned from this thread; I am approaching my last month on NEA (switched from £65 to £33 with no issue, thankfully!) and I can honestly state that my business adviser has never contacted me even once since the day we agreed my start date on NEA.

However, I am so glad that I took the leap and became self employed. Luckily my OH is there to advise me if I have any problems (that and the Good Small Business Guide 2013 - invaluable reading if you're new to it all as I was/am).

"I think you have to take control of your life if you want your business to work"

Very true words. You have to be tenacious and not take "no" for an answer, take control of the situation.

Knowing you're in charge is a fabulous, if sometimes scary! feeling.

Andy2013

This Year , so good to hear you again and glad its all working, I think we established a while ago NEA is pretty hopeless but your a winner and you made it happen , good on you :T

D4VE good to hear from you, in short I think the answer is no.

Any earnings you have are either turnover or profit and profit has to be disclosed to HB , but profit can to be reduced by buying business " provisions" that are a works expense but the problem is that you aim to use the money for personal use and not business.

The idea of lending the company the money is all fine but then to use it for personal use (ie rent, council tax, food etc) is in theory fraud and if records were looked into then trouble is near.

Your business records need to be precise and transparent and any accountant worth there salt would see this immediately .

The only way around it would be if you are working from home then you can claim expenses for tax purposes such as heating lighting etc but as for paying the rent its a dodgy area.

Be careful !!

As for the loan, they do give it to those with bad credit but it is paramount that you are totally honest about all past debts or they will bounce your application right away, worth a go at least.

WantToBeSE

Great to hear from you, This Year, and glad to hear things are working out OK

D4VE

Andy2013,

Thanks for your reply.

I though only MY earnings would have to be disclosed to HB. If it's the company profit then I'll be ok, as that won't be making a profit within the first 6 months.

I don't see the problem with me lending the company the money then the company repaying me. What I do with the money that the company repays is surely up to me. An accountant would understand this, as they'd only be looking at the company accounts, and would just see a loan to the company and repayment of that loan.

As everyone seems to keep saying on here, there's a lot of mis-information from the people involved in providing this [NEA], and a lot of unclear areas, that we seem to have to try and find/work out for ourselves. I think I'll ask the JCP and see what answer they give then report back here. i.e. If I work 35 hours a week and some govt. departments then class my 'earnings' as £220 at min. wage - I doubt many startup companies can make that profit within the first weeks.

Andy2013

Its best to get an exact answer from someone who works in this business such as an accountant because to me it seems a bit dodgy and for all I know could be fraud or embezzlement and I do remember a story in a local paper last year where by a company hid profits in a business to pay themselves later to avoid tax and all hell broke loose , a bit different I know but just a warning.

Also it is a shame that you are thinking of using the loan to help pay your daily bills in this way , to make ends meet as such.

In theory NEA should not leave you much worse of than JSA , when I left JSA it was £71 and NEA was £65 and I decided not to get the loan so it was not hanging over me which turned out to be a fab idea 1 year on.

Your circumstances must be different but have a chat with HB to see if they can help and remember you may get Working Tax Credits to add to your weekly income, this is dependant on the previous years income so worth a look into if you were on JSA for some time.

I was always told to be as transparent as possible so every penny can be found and every receipt kept as proof , when tax return time comes round its much easier.