Starting a business on JSA

psycrow57

I've posted this on a couple of boards as i'm
not sure who's most likely to have the info - sorry if this is wrong!

I've been on JSA for almost 15 weeks and have a review at 9am
tomorrow - haven't had a meeting since my first one 13 weeks ago, have just been filling in forms.

I've decided to start a business teaching classes - I did a test cladding yesterday which people paid for, but it cost me more to hold the class than I was paid so I haven't made any money yet.

I recently went on a Princes Trust course and they told us about 2 benefits available for starting a business. I'm not entitled to New Enterprise Allowance as I haven't been on JSA long enough but they said that, after claiming for 13 weeks, you can get around £50 a week for 12 weeks when starting a business, for the first 12 weeks.

Firstly, I need to know what this is called as I can't find any mention anywhere.

Secondly, my first class is on 10th October - should I be giving yesterday as the start date for my business, even though I haven't made any money, or should it be 10/10? Just want to make sure I'm doing everything properly - don't want to end up in big trouble for overclaiming.

I'd really appreciate some help before my appointment early tomorrow.

Many thanks
Rachel

Horace

I know that when I started my business off the dole, I got onto a New Deal for Self Employment programme. I understand that this has since changed and they call it something else (New Enterprise Allowance?).

If you have set up a business and have started trading regardless of whether or not you have earnt any money you need to notify the HMRC (failure to do so can result in you being fined), because you would need to arrange to pay Class 2 NI.

Try and be a bit devious with the jobcentre even though you haven't been unemployed long enough (normally it is about 6 months before you can get onto a scheme). Tell them that you have an idea for a business (don't say that you have started already) and can they tell you more about going self employed and is there any help available for you to allow you to do this.

Actually, thinking about it, register as self employed with the HMRC and tell the jobcentre that your circumstances have changed and that you will be self employed for 16hrs a week - you can still claim dole money. I have been self employed for 2 years and admit that I am really struggling now as I cannot find any work in events, I initially told the jobcentre that I had stopped working but now when I speak to them on Tuesday I shall say that I have work promised for next year and that I will be trying to find work in the meantime,that way I can keep my business going.

Look on the directgov website for details about self employment and jobseekers allowance whilst self employed. It is there, because I looked the other day.

When putting on classes - think about the venue cost and an hourly rate that you want to charge, if you havent made enough to cover the cost of the venue then you are not charging enough. Why not approach your local chamber of commerce because they have free courses for people who are considering being self employed, this will cover things such as legalities, sales & marketing, writing a business plan. Remember if you are running courses you will need to have professional indemnity insurance as well as public liabitlity insurance.

psycrow57

Thanks so much for your advice - really appreciate it.

My classes will be profitable when I do them properly - I had a smaller group paying a lower rate, and I had to buy equipment which i can use for future classes. I just wanted to make sure everything worked well and get input on any changes needed.

When I went on the PT course, the accountant told us we have three months from the time we start to register with HMRC as a sole trader/start paying national insurance so I'm going to hold off until the benefits are sorted.

I'll speak to him tomorrow and see what he says - technically I'm going to be working 12 or 18 hours a month when I'm up and running. Just want to make sure I can afford to live in the meantime!

Thanks again

Savvy_Sue

psycrow57 wrote: »

When I went on the PT course, the accountant told us we have three months from the time we start to register with HMRC as a sole trader/start paying national insurance so I'm going to hold off until the benefits are sorted.

That may have been true then, but that grace period has now been removed and you are supposed to tell HMRC immediately. However I don't think they usually fine you if you don't, as long as you don't leave it too long.

If you don't think you'll make more than c. £5,500 profit in your first year, then ask HMRC about the small earnings exemption. That way you won't have to pay s/e NI.

As Horace says, plan this carefully, because in the short term if you can continue to claim JSA then you'll get NI paid that way.

I'll see where your other threads are and arrange a merge. Please see this rule.

paulwf

OP - just wanted to say well done for putting some time and money in and giving it a go yesterday. So many people have good ideas but fail to check if they are likely to work before they start looking for funding. It may have been a small scale trial but I bet you have learned a lot.