Put Off Going Self Employed As A Writer

paulineb_2

Working tax credits are assessed on your previous years earnings. As a new business you cant be expected to make 30 hours a week x the national minimum wage right away, businesses take some time to build.

When I was first self employed in 2010, I had been unemployed for the 12 months before I put my claim in. They assessed my entitlement to WTC on what I had earned the previous tax year.

I also applied for WTC this year because I was starting up self employment again. My entitlement was assessed on my earnings to April 11, because I made the claim in February this year.

Again, part of those earnings were self employment and part of them were JSA, because I was back signing on for a time.

And the claim I have just made to continue my WTC claim, comprised of mostly my earnings from last years part time employment and some benefit plus a small amount of self employed earnings as I only started trading again in February this year.

There is absolutely no way that when someone makes their first claim for WTC, that they can declare that they have been making 30 hours a week x the national minimum wage, because they assess your income from tax year to tax year. Your earnings last year is what they will assess your claim on.

And I am aware that Universal credit is being rolled out and will affect small businesses, but I made my claim for WTC this year before I had started trading again. I simply gave them the date I was starting my business and told them what I had earned last year.

You cant declare money you havent yet earned. And if you do think your business is viable and is going to make you 30hours a week x the national minimum wage then for goodness sake let the working tax credit people know that and consider doing something else, start another business to get more money in, or try and find part time work (yes I know its tough, I live in an area of high unemployment as well)
I did probably earn the minimum wage last year, but thats only because I was working part time for a significant chunk of 2012 and did as much overtime as I could. I also did earn the minimum wage in 2011 but I did a lot of work that year (Im a freelance fitness instructor and its a poorly paid industry, particularly in the gym chains) but thats what you have to do, you have to be prepared to put the graft in because it can be very hard building a business.

I dont blame you for wanting to work, but if you really are serious about what you want to do, get some part time work and start from there, or think about other business opportunities that there are out there.

BIGBRO_2

Truegho wrote: »

This really is an horrendous situation to be in for people like myself, who want to go self employed as a writer. It's Catch 22, and by all accounts this new Universal Credit system is only going to exacerbate the problems low-income self-employed people are encountering. It is madness to insist on the precondition that you need to be earning at least the MINIMUM WAGE before they will even consider helping you financially. What about these businesses that struggle to make a profit in their early years of trading?

All this has left me feeling really depressed, as I now have to get back in touch with my business advisor at The Work Programme and explain to him that after the rather dissuading manner I encountered from the lady at Working Tax Credit this morning, it really has made me want to scrap the idea of starting my own business as a published writer.

Just put down minimum wage and take it from there. If you don't make enough and they ask you to pay it back then tell them you cant afford it, and there is a good chance they will write it off. Stop worrying and play the game You don't get anywhere by hiding under a rock, you're a writer so get creative

nannytone_2

BIGBRO wrote: »

Just put down minimum wage and take it from there. If you don't make enough and they ask you to pay it back then tell them you cant afford it, and there is a good chance they will write it off. Stop worrying and play the game You don't get anywhere by hiding under a rock, you're a writer so get creative

great advice!

telling someone to LIE!

this would constitute benefit fraud

Truegho

NYM wrote: »

How long have you been in self-employment ?

Since the beginning of June this year.

Housing_Benefit_Officer

nannytone wrote: »

great advice!

telling someone to LIE!

this would constitute benefit fraud

Most self employed accounts I see are works of fiction - I wonder if I could sell them on Amazon as Kindle downloads?

dktreesea

Truegho wrote: »

It is a business. I have registered as a sole trader with HMRC, have completed a tax return etc. But as I say, being denied WTC is a BIG disappointment, and has put me in a very stressful and insecure position now where I am trying to build up my earnings as a published author so that I don't have to go back on the dole again when my current savings go down. If I could get even a part-time job to get that little bit more income, it would alleviate the strain. I really want to make a success of my writing business, as I love writing Kindle books and getting them published. But the early days of a business are always hard, and this is why I am puzzled why the government doesn't seem to bear this mind when insisting that you must earn the MINIMUM wage before you can get WTC.

You don't have to earn the minimum wage before you get benefits due to your self employment. But you do have to provide evidence of payment for your work. Writing a book in the hope of generating a future revenue stream doesn't cut it.

If, on the other hand, say it's Kindle books you are writing, and every couple of weeks you have evidence of the money you receive from Amazon from the sale of your books, that's a business. Even then, you could still be turned down for WTC if the decision maker thinks the income stream is likely to be too low, going into the future, to have a viable chance of supporting you.

dktreesea

Housing_Benefit_Officer wrote: »

Most self employed accounts I see are works of fiction - I wonder if I could sell them on Amazon as Kindle downloads?

That sounds to me more like the HB officer can't be bothered to make the enquiries they should be making to establish whether the accounts are true. Apparently our local council asks for things like copies of bank accounts and evidence that the income going into the account is actually revenue from the business. One guy told me they even asked him for his log book, to support the mileage hours he was claiming.

I have been to quite a few meetings with HB officers over the years with my clients. Some of them would do well to learn their own regulations. Things like trying to disallow interest on the business borrowings, something expressedly allowed for in the relevant act. Or wanting to disallow travel expenses, because "travelling 30,000 miles a year is too much travelling for work."

Dovah_diva

Truegho wrote: »

Well, I have been turned down for Working Tax Credit just because my publishing business is not yet earning the min wage. It doesn't matter if my business is only in its infancy and that I AM working 30hrs pwk on it.

So where do I go from here? Should I continue with it and try and sell more and more books to get it up to min wage level, or just do it in my spare time and sign back on the dole?

Needless to say, I am feeling really depressed about this.

You need to get a job and write in your spare time.

superwoman4

Dovah_diva wrote: »

You need to get a job and write in your spare time.

That's the problem, he/she can't get a job.
This is an alternative to looking for work.

Dunroamin

superwoman4 wrote: »

That's the problem, he/she can't get a job.
This is an alternative to looking for work.

It's only an alternative if he earns any money - otherwise it's just a way of cheating the system.