ESA permitted work and self employment

littlerat

Ok, wondering if anyone can spell some bits out for me as the info out there is confusing for me.

Long story short, I've been on esa for about 2 years, my assessment which put me in the support group was in Feb 10. But my assessment was late so backdated about 4 or 5 weeks. If it matters! I'm on it for depression/anxiety

Anyway while I've vaguely looked into it before, and half tried to look into setting up in self employment, but various setbacks and such I've not really been in a position to until now (well, in a couple of months).

Ok, my main questions:
The earnings limit of £92 or whatever, in self employment is it profit or intake? As obviously, £92 before expenses are removed may not be tons of profit.

I know the limit is per week, but is it worked out over a longer period/average? As there's a chance I may get £110 one week, but nothing for the next 3 or such! I won't be overbooking myself and will be limited with what I can cope with taking on unfortunately.

What's the actual process? I assume I tell them, would I ask permission and if they day yes, do the hmrc stuff? Do I need to actually ask permission or am I simply informing them I'm doing it?

And basically, anything else I need to know? (bar the chance I get reassessed and kicked off benefits, I realise that is a risk but I feel I'm nearing the stage where doing nothing and time isn't enough to improve)

Yea so... Thanks anybody who can help.

rogerblack

littlerat wrote: »

Ok, my main questions:
The earnings limit of £92 or whatever, in self employment is it profit or intake? As obviously, £92 before expenses are removed may not be tons of profit.

I know the limit is per week, but is it worked out over a longer period/average?

You need to tell them.

Unfortunately, there is no handbook or leaflet on this, and the guidance to decision makers in internally contradictory.

See http://www.dwp.gov.uk/publications/specialist-guides/decision-makers-guide/#vol8 - for the whole lot.

You specifically want to read the 'self employed earners' and 'general rules on income' parts.

In short - it's not 92, it's 92 income, after tax, certain NI conts, (probably not applicable unless you set up a company so you're actually employed not self-employed), half the amount you contribute to a personal pension, and expenses wholey and unavoidably due to running the business.

They may average it, but it depends on their interpretation of the guidance.
One bit says 'the period of averaging should be extended as time goes on up to the first 12 months' - which implies you can earn 40 pounds in week 1, then 140 in week 2, ...

But the examples are all averaging over a shorter period.

Then there are 'bushiness cycles' rules - if you earn once every 4 weeks, for example this may be a appropriate.

In short - it's horribly confusing.
Try to understand the above guidance, and then submit your PWK form, register with HMRC, and then negotiate with your personal adviser, or whatever they call them.
Get their direct phone number first time they contact you.

Be careful.
If you earn too much, then your money is not reduced, your claim ends, it is not suspended, and you need to reapply.
This is why you need to get it really clear, ideally in writing, what the averaging rules are.

A personal pension you can flexibly put excess money in would be useful.
I'm unsure how that works, but from an ESA point-of-view, if you put in 100 pounds a week, then you can earn the earnings limit + 50.

You absolutely need to register - they don't have to treat any work as permitted work, and as I understand it any work done outside the permitted work rules has no allowance. That is - earn 20 pounds, and your benefit is reduced by 20 pounds.
In addition, permitted work is to be ignored when assessing capability of work.
Other work is not ignored.

littlerat

Well that's horribly confusing!

But thanks, a few reads and I'm beginning to make headway


Now just to work out if I have or how I get a personal advisor type person...

rogerblack

littlerat wrote: »

Well that's horribly confusing!

But thanks, a few reads and I'm beginning to make headway


Now just to work out if I have or how I get a personal advisor type person...

They ring you, after you send in the permitted work form, should have added that.

They _really_ need to get a leaflet on how to do this.
Doing permitted work is trivial if you want to do 5 hours a week on minimum wage at macdonalds.

littlerat

Ok thanks - erm so do I speak to a personal advisor to get the permitted work form?

Because I don't think I have one, do I just phone the job centre and ask to talk to somebody?

rogerblack

Phone up the number on the top of the ESA letters, and ask to be sent a permitted work form.
Fill this in, then they contact you.
At least this was my experience.

littlerat

Thanks, that's one hell of a help!