Starting up as self-employed/income support?

ArthurJobBob

Hi, I hope someone can help me. I'm struggling to find permanent employment in my field, and I'm thinking of going self-employed.

The work I do is paid well per hour, but the difficulty is actually getting the hours in. Hopefully, this will only be a short/medium term problem, as I get established, so I was looking at what benefits I would be entitled to in the mean-time.

Because it's well paid per hour, I don't think I'd get tax credits - if I managed to put in a 30 hour week, I'd have earned enough to be over the threshold. There's not really much un-paid 'business building' and admin stuff involved, just paid work.

According to the benefit calculator, I would possibly be able to get income support, if I was working less than 15 hours a week. This is very likely - for the first few months I'll be lucky to get more than a couple of hours a week!

However, I'm a single man with no children, and I don't act as a carer for anyone, and I've read that you need to be one of the above to get IS? But the benefit calculator asked me those questions, and still said I would get IS? Confused!

My other question is, if I was entitled to IS, how long do you get to make the business viable? Surely there's a point where they turn round and say, "Look, you're only getting 2 hours a week, stop being self employed and go on JSA and get a proper job"?

I hope this doesn't come across as being benefit-scrounging, I only want short-term help, after which I should hopefully be making good money and giving back to society!

Thanks in advance.

Notmyrealname

Because it's well paid per hour, I don't think I'd get tax credits - if I managed to put in a 30 hour week, I'd have earned enough to be over the threshold.

It isn't what you earn per week but what you earn over the year. Also it is the profit you earn which is income less tax deductible expenses and you'll have quite a lot of them.

ArthurJobBob

But most weeks (at first) I won't be working anywhere near 30 hours a week, so surely this would rule out WTC initially?

benefitbaby

ArthurJobBob wrote: »

But most weeks (at first) I won't be working anywhere near 30 hours a week, so surely this would rule out WTC initially?

Yes you are correct, and you are also right about income support. Assuming you do not have long term ill health/disability then the only benefit available to you whilst building up the business is JSA.

You can work UP TO 16 hours per week and earn no more than £75 per week (£71 personal allowance + £5 earnings disregard = £76) and retain JSA. Obviously Jobcentre will require you to seek full-time work whilst claiming and doing your s/e work.

Housing benefit and council tax benefit may also be payable depending on the level of income.

When you do finally work s/e at 30 hours per week your WTC entitlemetn will be based on your income/earnings in the previous tax year so you may well qualify.

merlin68

You can claim income support op.
Who can get Income Support

It's for people who all the following apply to:

• are between age 16 and the age they can get Pension Credit
• have a low income
• work less than 16 hours a week, depending on the amount of your wage
• aren't in full-time study (but there are some exceptions)
• don't get Jobseeker's Allowance or Employment and Support Allowance
• don't have savings above £16,000
• live in Great Britain

Rockingsurfer

I was involved in a similar scenario regarding WTC/CTC some years ago. You should be counting the hours you work in the business, not the number of billible hours. Searching for clients, doing your own books etc is work, you just are not being paid to do it!

However there is probably somebody with a better benefits background than me to give a definitive answer

RS

benefitbaby

merlin68 wrote: »

You can claim income support op.
Who can get Income Support


It's for people who all the following apply to:

• are between age 16 and the age they can get Pension Credit
• have a low income
• work less than 16 hours a week, depending on the amount of your wage
• aren't in full-time study (but there are some exceptions)
• don't get Jobseeker's Allowance or Employment and Support Allowance
• don't have savings above £16,000
• live in Great Britain

You cannot get Income Support unless you fall into a group of people who do not have to be ‘available for work’.

You don’t have to be available for work if you are:

• a single parent under the age of 18, or a single parent bringing up a child under five on your own. In some cases, you don't have to be available for work and you can carry on getting income support for a certain period if your child is older than this
• getting Carer’s Allowance
• looking after your partner, who is temporarily ill
• looking after a child under 20 for whom you are responsible and who is temporarily ill
• incapable of work because you’re pregnant. Some pregnant women might be able to claim Employment and Support Allowance (ESA) instead.

So.... JSA it is then unless as Rockingsurfer says the OP's total hours working reaches 30 at which point WTC will be claimable.