New business but unemployed - questions!

PurpleAngel

Hi,
I have been recieving benefits due to illness for over 15 years now, they are really putting the pressure on to work now but because I can't my family are helping put some money together to start an ebay shop, hopefully I will be able to cope, as it is from home I am really hoping it will be ok.
Anyhoo - Who do I need to contact to start a business, will I still get benefits till I start making money to live on? (Really hope I can *gulp!* )
So many questions but will start with that one, i bought my first small bit of stock today but wont start selling till I have done what I need to!

CKhalvashi

PurpleAngel wrote: »

Hi,
I have been recieving benefits due to illness for over 15 years now, they are really putting the pressure on to work now but because I can't my family are helping put some money together to start an ebay shop, hopefully I will be able to cope, as it is from home I am really hoping it will be ok.
Anyhoo - Who do I need to contact to start a business, will I still get benefits till I start making money to live on? (Really hope I can *gulp!* )
So many questions but will start with that one, i bought my first small bit of stock today but wont start selling till I have done what I need to!

You’ve got 3 months (or did when I started) to let HMRC know what’s happening. You can also make a claim for tax credits if you’re working more than 16h/week, or continue on JSA if working less than this, which has a £5 disregard.

With benefits, I’m not 100% sure, so the best thing to do is check and thou shalt be answered.

PurpleAngel

Thank you!!!!!!!

I will call HMRC and Jobcentre tomorrow, I do want to do it all properly. I dont think i will be able to earn more than what I am receiving at the mo as i cannot do much so I am hoping Housing benefit will still be paid ok :question:

Notmyrealname

There is no 3 month grace and hasn't been for a while but as you are obviously intent on telling HMRC as soon as they open....

Speak to an advisor at the Job Center about Return To Work Credit. I had it and if it is still on the go it is £40 a week tax free for a year and disregarded for benefits. HOWEVER you will need to do a business plan and have that checked by whoever the job center want to do it before you qualify.

Make an appointment to speak to your local Business Link before the govt close it as they are a wealth of info.

Also...make sure your ebay account is a business account as the commission fees are far lower - 3% on technology categories as opposed to 10% for example.

You will need to notify HB/CTB of change in circumstances giving them an estimated profit. They will require accounts periodically, usually every 3 months, with the next periods benefits based on the last periods accounts.

Also depending on the hours you're doing you may be entitled to working tax credit.

tigeress289

In all honesty, if you have been signing on for all these years, there is a reason? Do not be frightened into coming off of benefits you are fully entitled to. There is no way you could start a business from scratch, I dont care what anyone else tells you. To start a business has to be something you want to do and not be forced into doing. Take up your concerns with your local citizens advice centre before you even dream of phoning HMRC. If you speak to your job centre they will not be able to give you the proper advice. Do not go self employed and stay as you are untill you are in a better position. Do not go into self employment lightly as it will open you up to more problems than you ever thought. Look for advice on you unemployment status first, "DO NOT" let the job centre pressure you into anything. You have RIGHTS, use them.

Caroline_a

I have to agree with tigresse I'm afraid. Starting your own business is not an easy option, and Ebay is pretty much saturated these days. Depending on your illness you will find working for yourself a lot more stressful than working for someone else - if it's not successful there is the stress of why, what can you do to improve things, how are you going to pay your bills, etc. If it is there is VAT, other regulations to do with distance selling, pricing your goods correctly so that you are able to make a profit when you have paid all your expenses, etc etc.

It's something that you should consider when you are 150% fit, not coming out of long term illness, or, as something to get the JobCentre off your back I'm afraid.

Mistral001

Caroline_a wrote: »

I have to agree with tigresse I'm afraid. Starting your own business is not an easy option, and Ebay is pretty much saturated these days. Depending on your illness you will find working for yourself a lot more stressful than working for someone else - if it's not successful there is the stress of why, what can you do to improve things, how are you going to pay your bills, etc. If it is there is VAT, other regulations to do with distance selling, pricing your goods correctly so that you are able to make a profit when you have paid all your expenses, etc etc.

It's something that you should consider when you are 150% fit, not coming out of long term illness, or, as something to get the JobCentre off your back I'm afraid.

I agree with this totally. Starting a business which is going to provide you with income to pay bills rather than pocket money is difficult and cannot be started overnight despite all the optimistic claims made in the popular media. Also the ebay market is really saturated with sellers. Often these sellers are people on good salaried jobs doing it as a hobby or as a second income as a way of earning a little bit extra to pay for an extra weekend holiday etc. so if it does not work out very well it is no hassle for them, they have still got their day-job.

Also it is not stress-free. Look at the ebay forum on this board. You will see lots of very stressed-out sellers complaining about being scammed by buyers who know that they are in a buyer's market where they mess sellers around knowing that they will usually have the upper hand.

PS. Are you a buyer on ebay. If you are then you will know the rediculous margins that most ebay sellers make. You will often be competeing with people who make pence on each item.

Notmyrealname

Completely disagree. Whilst the business probably won't earn enough to live on, it will be worth it just for the improvement in the OPs mental health. Having been there myself facing endless days of drudgery on the sick, the chance to do something productive no matter how little in time or monetary worth lifted me out of depression I had slid into.

CKhalvashi

Notmyrealname wrote: »

There is no 3 month grace and hasn't been for a while but as you are obviously intent on telling HMRC as soon as they open....

Speak to an advisor at the Job Center about Return To Work Credit. I had it and if it is still on the go it is £40 a week tax free for a year and disregarded for benefits. HOWEVER you will need to do a business plan and have that checked by whoever the job center want to do it before you qualify.

Make an appointment to speak to your local Business Link before the govt close it as they are a wealth of info.

Also...make sure your ebay account is a business account as the commission fees are far lower - 3% on technology categories as opposed to 10% for example.

You will need to notify HB/CTB of change in circumstances giving them an estimated profit. They will require accounts periodically, usually every 3 months, with the next periods benefits based on the last periods accounts.

Also depending on the hours you're doing you may be entitled to working tax credit.

Thanks for clarifying this, I registered in 2002, and that’s one more for the scrapbook!

Mistral001

Notmyrealname wrote: »

Completely disagree. Whilst the business probably won't earn enough to live on, it will be worth it just for the improvement in the OPs mental health. Having been there myself facing endless days of drudgery on the sick, the chance to do something productive no matter how little in time or monetary worth lifted me out of depression I had slid into.

The OP specifically mentioned starting an ebay shop at home. I am all for doing something productive, like working in a charity shop or helping a relative in a shop or business, or working part time etc. I have known people with severe mental illnesses turn round their lives in this way. One is now a lecturer in a university. Ebay shop's I believe are over-hyped at the minute. 5 years ago it could have been a good option as it was not so much a buyer's market and margins could be OKish or even fairly high if you got into a niche market that few were in. Today it is over-crowded. Also it has to compete with Amazon and others now as well.

tigeress289

Business Link are just holding on by the skin of their teeth and can offer no REAL help to anyone trying to start a business. The working credit for self employed stopped last year around april time and was for only 16 weeks. The last thing anyone on this forum should do is encourage anyone to put themselves in a worse position than they are already in. The last thing the OP needs,is total mis information about how good they will feel starting a new business, no matter how little is coming in. If you could help when Baliffs start knocking and supplies get cut off, then start offering your services. I beg the OP to get legal advice before doing anything as STUPID, as coming off the benefits they are already on and to really rethink of their situation. I have been there, so this is from the heart. Get advice.