Pension Credit and Self-employment?

esseesee

I finally gave up work several months ago and now receive a partial State Pension, Pension Credit Guarantee and Housing Benefit.

I now feel that I've holidayed for long enough, and am considering entering self-employment later this year, depending on how some trials I make go.

However, I cannot get an answer from anyone re Pension Credit, any profit I might make from my prospective business and their relationship.

I am referred by Pension Credit to 'the taxman' and HMRC told me to ask the DWP - talk about going round in circles!

Anyone got any experience of this? Or can suggest where I might find information on it?

anmarj

there is no real definite answer, basicaly you would need to submit details of your income and expenditure and a specailist would work out what allowable expenses are (not the same as HMRC) and then work out your earnings per week on that. This would be reviewed every year and any increase over the previous accounting period would be taken forward on your claim and not done as an overpayment (if you can grasp what I mean)

esseesee

Yes, I think I see what you mean ...

I assume, when you refer to 'income and expenditure' that you are referring to income and expenditure with reference to the self-employment aspect of my income, added to my partial state pension, over the year, to give a total taxable income for the year, from which sum my following year's eligibility for pension credit and housing benefit would be calculated?

Is this done by the 'specialist' on anything like the same basis as is done by HMRC?

When I enquired at DWP about the mechanics of PC were I to take employment, even temporary such as locum, seasonal or part time, I was told by them that my PC would stop immediately and I would have to go through the entire process of reapplying for PC again. Y-A-W-N.

Which thought is what made me think that self-employment, using a skill that has been a hobby, and used in voluntary work, for many years, might be easier to manage financially ... until I came up against the barriers of being sent around in circles with the sole answer being 'we don't know'.

Anyone would think 'they' don't want me to work in any way, shape or form!

anmarj

esseesee wrote: »

I assume, when you refer to 'income and expenditure' that you are referring to income and expenditure with reference to the self-employment aspect of my income, added to my partial state pension, over the year, to give a total taxable income for the year, from which sum my following year's eligibility for pension credit and housing benefit would be calculated?

Is this done by the 'specialist' on anything like the same basis as is done by HMRC?

Yes. Not sure what HMRC process use, but as I said, HMRC may allow certain things, PC may not. Not being a specailist , I can't really say if is the same basis or not

esseesee wrote: »

When I enquired at DWP about the mechanics of PC were I to take employment, even temporary such as locum, seasonal or part time, I was told by them that my PC would stop immediately and I would have to go through the entire process of reapplying for PC again.

only if the amount earnt would exceed your Pension Credit. I have know people to take the odd job and only have a clerical overpayment raised for the payment period.

satarical

esseesee wrote: »

Yes, I think I see what you mean ...

I assume, when you refer to 'income and expenditure' that you are referring to income and expenditure with reference to the self-employment aspect of my income, added to my partial state pension, over the year, to give a total taxable income for the year, from which sum my following year's eligibility for pension credit and housing benefit would be calculated?

Is this done by the 'specialist' on anything like the same basis as is done by HMRC?

When I enquired at DWP about the mechanics of PC were I to take employment, even temporary such as locum, seasonal or part time, I was told by them that my PC would stop immediately and I would have to go through the entire process of reapplying for PC again. Y-A-W-N.

Which thought is what made me think that self-employment, using a skill that has been a hobby, and used in voluntary work, for many years, might be easier to manage financially ... until I came up against the barriers of being sent around in circles with the sole answer being 'we don't know'.

Anyone would think 'they' don't want me to work in any way, shape or form!

Yes your GPC claim would stop until such time as you were able to satisfy the Pension Service of your income.
But be aware that if they give you a directive to supply any accounting information AND it is not supplied within one month they will close the PC claim entirely.

esseesee

satarical wrote: »

Yes your GPC claim would stop until such time as you were able to satisfy the Pension Service of your income.

Are you aware whether this would apply to both PAYE employment and to self-employment, or merely to PAYE employment? If it applies to PAYE employment, that would be reasonable, as payslips would serve as evidence of income - but if merely registering with HMRC as self-employed/sole trader puts me in the situation where my PC stops immediately, then I shall have to rethink my plans.

satarical wrote: »

But be aware that if they give you a directive to supply any accounting information AND it is not supplied within one month they will close the PC claim entirely.

Sorry, I don't understand quite what you mean here. Again, does this apply to PAYE employment, to self-employment, or to both? I have already been told by DWP that the instant I tell them of even a couple of weeks' locum job - which would earn me an income of significantly more than I get from PC - my PC will cease and I will have to put in a new claim for it when my income ceases. I have` already decided that is a mug's game. Go through all that every time I accept a locum position? No way! And what would I live on during the interminable weeks when the claim is being assessed, and then complicate matters by doing another locum a couple of weeks after the PC is restarted ...

When is this request for accounts likely to happen in self-employment? If I do go further with my plans and register as self-employed, I would not expect to start picking up business, still less making a profit, for several months at least, so there won't be any accounts, other than some expenditure on materials and equipment, and all the other columns containing the word 'nil'.

esseesee

anmarj wrote: »

only if the amount earnt would exceed your Pension Credit. I have know people to take the odd job and only have a clerical overpayment raised for the payment period.

The amount I would earn would exceed my pension credit by a significant amount - but literally for one or two weeks only, as i am only interested in taking short-term locum positions maybe two or three times a year.

If I need go through all the rigmarole and delay of reapplying for PC after a mere week's work (I would be perfectly happy for the PC to stop for that week, or to have it clawed back later) it is far too much bother; I can see it taking so long that I've taken another locum by the time it is approved, and the entire process will have to be restarted!

Easier by far to continue to sit on my backside with the blessing and support of the state, but as a hale, hearty and healthy person with professional qualifications which are very much in demand, and a wealth of experience, the odd week's locum here and there would seem to be a productive plan for both me and an employer.

missapril75

I can see why you aren't getting straight or straightforward answers.

The only alternative to having the PC stop and start three times (for 3 bits of work in the year) would be to have the earnings assessed over a longer period. Apart from that not happening until a work pattern was established, if your payments, after expenses, were totted up and divided by 52, a deduction of that amount each week might cost you a bigger loss of PC than just losing the three weeks.

And if the usual 16 hour work exclusion applies to PC as it does with other benefits, that might not be an available alternative anyway.

Your idea of having the PC clawed back for each week not due would have worked quite simply before computers. You could have sent a cheque (or had the slip in your payment book cancelled) and it would be done.

But computers are very much in control. Unless there's been a major change they can't just suspend for a week. Perhaps it's worth asking the question - If I get a one off week's work can you just stop PC for that week and start it again for the week after without having to go through a new claim.

Or if it has to be a new claim, is there a quick route?

Maybe someone on here knows.

anmarj

if you read my post 4 I did actually answer that question regarding the odd job

"I have know people to take the odd job and only have a clerical overpayment raised for the payment period."

in other words they would do just a overpayment for the period the money would be covering with out stopping the claim

there is no rapid reclaim process or is there a 16 hour rule either.

esseesee

anmarj wrote: »

if you read my post 4 I did actually answer that question regarding the odd job

"I have know people to take the odd job and only have a clerical overpayment raised for the payment period."

in other words they would do just a overpayment for the period the money would be covering with out stopping the claim

there is no rapid reclaim process or is there a 16 hour rule either.

Sorry, I misread your answer as referring to a person taking on an odd job - as in 'the odd job man' (or woman!) who receives NMW or thereabouts for, say, working at the village shop for week because the regular worker has a sudden temporary family emergency, or doing a few hours in the local restaurant's kitchens when they're let down on the night of a big 'do' - not as a person taking on a well-paid professional locum post, albeit only for a week or two at a time.

I suppose it's worth asking about the possibilities of a clerical overpayment and see what the answer is; can't be a less helpful answer than the answers I've had from them before!

I really would love to return to my profession on a purely occasional basis - I have someone pestering me to cover for half-term holidays - but I think I'll have to confirm the 'no' answer, at least for this coming half-term and until I can get some sort of definitive answer.

Self employment of some sort looks as if it might be a little more flexible - as I thought - and is certainly merits looking at in more depth and asking more specific questions of the pensions agency.

It certainly seems as if those of us who receive Pension Credit are being strongly discouraged from any form of paid employment or profit-making venture by locked barriers for which it is difficult to find the key.

missapril75

anmarj wrote: »

if you read my post 4 I did actually answer that question regarding the odd job

Ah. Fair enough then. That would be a good solution.