Tax Credit Min Wage Precondition - I Need Advice

MissMoneypenny

Truegho wrote: »

You can't just start a business and expect it to be earning the min wage from Day One. Those who have managed to achieve this must be very, very lucky indeed.

Lucky? They make their own luck by researching the market and by having a business plan. They do a PAYE job and start their business as a hobby, until they know their business can pay them a living wage. They work many hours to make their business succeed. This is what was done before tax credits.

Housing_Benefit_Officer

MissMoneypenny wrote: »

Lucky? They make their own luck by researching the market and by having a business plan. They do a PAYE job and start their business as a hobby, until they know their business can pay them a living wage. They work many hours to make their business succeed. This is what was done before tax credits.

Perhaps the best success story I dealt with as a guy with mild learning difficulties (somewhere on the Autism spectrum) who was put through college by his parents (studying electrical engineering or something like that) but in all intents and purpses unemployable becasue of the difficulties he has in social interaction. He was obsessed with Dyson Hovers and used to spend his time hoarding broken cleaners, taking them apart and fixing them. He used to collect all the Dysons taken to the tip or pick them up at car boot sales. One day it was suggested why didn't he sell the parts on eBay - initially rubbished - but with the support of his parents - his business has grown and grown and grown - basically from one broken hoover he can make £100+ selling the various parts on eBay. His business grew to such an extent his income and capital was too high to qualify for benefits - he still has his eBay shop, a Saturday market stall with his Mum selling reconditioned hovers and any spare part someone wants (if he doesn't have it he can get it).

That is what I call someone with a hobby/obsession - with a little help and guidance - and finding a gap in the market - can make a financial success with what he is doing.

Another person I dealt with started selling home brew ingredients and equipment on eBay and now is growing his on-line business year on year - still on benefits and gets tax credits but they are making a success so in a couple of years he will be off benefits altogether.

Cate1976

Love this story, what an inspiration to others with mild - moderate learning difficulties. My concern with the new rules is the number of genuine self employed businesses that are going to be hit by the new rules.

Dunroamin

Housing_Benefit_Officer wrote: »

Is that you Truegho?

Or, perhaps, his older brother?:)

Dunroamin

Truegho wrote: »

But I DO hope to start increasing my earnings as I write more and more books. I have always been very passionate about writing, so I thought, why not try and make a career of it? You know, I really get sick and tired of these people who dismiss writing as just a "hobby". It is NOT just a hobby if you have set up a viable business to run alongside it. I not only write books, but I also offer a freelance writing service to run alongside my authorship. So, I repeat it, it IS a viable business.

Surely, if it's a viable business, you'd only need tax credits for a very short period?

compoff

I provide you with the links to advise you what tax credit compliance staff are instructed to take into account when determining whether self employment is, first of all, genuine and, secondly, remunerative work.

http://www.hmrc.gov.uk/manuals/ccmmanual/CCM6750.htm

This next one will also give some pointers to what can be considered as hours worked, provided the activity is directly linked to the furtherance of the business.

http://www.hmrc.gov.uk/manuals/ccmmanual/CCM6755.htm

Furthermore, you will see from the next one that tax credits staff should NOT be investigating your level of income. They can use it as a guide, and they have successfully argued cases in court where the income was minimal. But this was generally in cases where the business has no prospect whatsoever of growth.

http://www.hmrc.gov.uk/manuals/ccmmanual/CCM6740.htm

Icequeen99

compoff wrote: »

I provide you with the links to advise you what tax credit compliance staff are instructed to take into account when determining whether self employment is, first of all, genuine and, secondly, remunerative work.

http://www.hmrc.gov.uk/manuals/ccmmanual/CCM6750.htm

This next one will also give some pointers to what can be considered as hours worked, provided the activity is directly linked to the furtherance of the business.

http://www.hmrc.gov.uk/manuals/ccmmanual/CCM6755.htm

Furthermore, you will see from the next one that tax credits staff should NOT be investigating your level of income. They can use it as a guide, and they have successfully argued cases in court where the income was minimal. But this was generally in cases where the business has no prospect whatsoever of growth.

http://www.hmrc.gov.uk/manuals/ccmmanual/CCM6740.htm

Can you link to the case law you mention?

IQ