Currently on JSA want to move onto Working Tax Credits......

busy_mom_2

Can I presume you are a lone parent? Have you spoken to anyone at JCP? Are you on the work programme? You may be eligble to claim NEA. Are you qualified to do nails and have you researched your area for prices, demand etc? You need support form business mentors to make sure you do things correctly. Ask either JCP or WP for a referral. Good Luck.

M.Johnson_2

It is a little less money per week to move as the op says over from JSA to WTC. But no need to sign on every two weeks and if you move over to WTC there is no longer so much pressure these days to do a work program or something like on JSA.

Some say it was just a ploy to get the unemployment numbers down if so it worked.

With the introduction of UC all those who dont want to sign on and move over to WTC will suddenly appear on the unemployed numbers if they are not making much profit in their SE 'Business' .

dktreesea

M.Johnson wrote: »

With the introduction of UC all those who dont want to sign on and move over to WTC will suddenly appear on the unemployed numbers if they are not making much profit in their SE 'Business' .

Not necessarily. If the DWP decides the person is gainfully employed, but not making at least as much profit as whatever the minimum wage works out to for the hours the claimant is meant to work, they would just treat the person as self employed. They would calculate their benefits based on the higher of actual profits (after adding back things that are claimable under tax but not for the purposes of UC entitlement, e.g. interest on business loans) or the minimum income floor.

If you are working in a business for 35 hours a week, you could be gainfully employed even if you only make 50p an hour. There doesn't seem to be a requirement, in either the welfare reform bill or the later regulations published earlier this year, to be earning a set amount from a business before you can be "gainfully employed". Have you come across any links in the legislation between profits and being gainfully self employed? If yes, please can you post the relevant sections?

Even if the MIF applies - and transitional provisions to protect current entitlements don't apply for the self employed - the government will still have the same problem as before. Yes, for sure, it will be a lot less expensive but at what point will the DWP be saying that the business isn't viable and therefore the person has to go onto the jsa with all the conditionality clauses that then apply? If the person is running their business, are they "gainfully employed" whether they earn 2p an hour or £20 an hour?

FBaby

Women will always want to have their nails done, so nothing wrong in theory with starting such a business...if it is really about starting a business, ie. working very hard to build a clientele, making your business sound and self-sufficient.

If you are just looking at a way to have a nice stress free life, doing a bit of work that you enjoy doing, just enough that you can claim tax credits and continue to spend most of your time with your children, then that what might become more complicated under UC. You WILL need to demonstrate that you are holding a business that makes some profit rather than using a hobby to claim benefits.

Charityworker

I'm a self employed manicurist and nail artist. It takes time to get your business up and running and gain a clientele. I found that turning up at community events and doing mini manis for £3 is a good way of advertising and you can make a bit of money from that.

However I don't make anywhere near enough money to live on. Probably an average profit of about £50 per week. So I do a part time job as a receptionist as well.

Good luck with your ventures though.

M.Johnson_2

So after UC anyone claiming to be self employed will be assumed to be earning min wage per hr for the number of hrs they say they are working? If they earn less in actual fact then they will be on less income than someone who is just unemployed.

I can see most on WTC credit at the moment joining the ranks of the unemployed.

M.Johnson_2

dktreesea wrote: »

Not necessarily. If the DWP decides the person is gainfully employed, but not making at least as much profit as whatever the minimum wage works out to for the hours the claimant is meant to work, they would just treat the person as self employed. They would calculate their benefits based on the higher of actual profits (after adding back things that are claimable under tax but not for the purposes of UC entitlement, e.g. interest on business loans) or the minimum income floor.

If you are working in a business for 35 hours a week, you could be gainfully employed even if you only make 50p an hour. There doesn't seem to be a requirement, in either the welfare reform bill or the later regulations published earlier this year, to be earning a set amount from a business before you can be "gainfully employed". Have you come across any links in the legislation between profits and being gainfully self employed? If yes, please can you post the relevant sections?

Even if the MIF applies - and transitional provisions to protect current entitlements don't apply for the self employed - the government will still have the same problem as before. Yes, for sure, it will be a lot less expensive but at what point will the DWP be saying that the business isn't viable and therefore the person has to go onto the jsa with all the conditionality clauses that then apply? If the person is running their business, are they "gainfully employed" whether they earn 2p an hour or £20 an hour?

I am trying to understand what it will be like when UC replaces the current system.

Take an example of a small family at the moment with 2 kids.

If this family was working 30hrs week but making no profit from the self empolyment, they would get about £100wk WTC, and CTC also about £100. They would get £30wk CB and say their rent was about £260wk as long as still no profit every year from their 'business' then they would get most of that paid. Depending on the area they may get help with council tax and a few other 'benefits' which will bring them in at around the benefit cap of £500wk.

If the family was not working at all it would be about the same but the JSA would replace the WTC and it would be a little more, but not much. So they may lose that anyway if they are near the £500 cap. But if they were on JSA they would not only have to sign every 2 weeks but come under increasing pressure to go on a work program or something, and all the other reasons why as the title of this thread shows many choose tomove from JSA onto WTC and not have all the hassel of JSA.

So when UC replaces the current system it should put an end to all those who choose to move from JSA onto WTC but do not make a profit. Either they will have to make at least min wage per hr for 30hrs, or their benefits will be cut as much as if they were earning that much.

Surely most would choose to move back to the first option and get the most benefits again?

FreeddyThomas

There is choice after UC. At the moment you can choose either option JSA or WTC. After UC it will all be the same and if you are S.E. then you will be presumed to be earning min wage x35hrs.

It could be millions go from the WTC crowd but now will be included in the unemployed.

MissMoneypenny

M.Johnson wrote: »

I am trying to understand what it will be like when UC replaces the current system.

Take an example of a small family at the moment with 2 kids.

If this family was working 30hrs week but making no profit from the self empolyment, they would get about £100wk WTC, and CTC also about £100. They would get £30wk CB and say their rent was about £260wk as long as still no profit every year from their 'business' then they would get most of that paid. Depending on the area they may get help with council tax and a few other 'benefits' which will bring them in at around the benefit cap of £500wk.

They won't be subject to the benefit cap as they are "working" - even though they aren't really and are just pretending to work 30 hours a week to claim WTC and avoid the work programmes;signing on; and the benefit cap.

M.Johnson wrote: »

If the family was not working at all it would be about the same but the JSA would replace the WTC and it would be a little more, but not much. So they may lose that anyway if they are near the £500 cap. But if they were on JSA they would not only have to sign every 2 weeks but come under increasing pressure to go on a work program or something, and all the other reasons why as the title of this thread shows many choose tomove from JSA onto WTC and not have all the hassel of JSA.

So when UC replaces the current system it should put an end to all those who choose to move from JSA onto WTC but do not make a profit. Either they will have to make at least min wage per hr for 30hrs, or their benefits will be cut as much as if they were earning that much.

Under Universal Credit, the parents in your example will have set hours each. Once on Universal Crerdit: one parent will have to earn at least 35 hours per week an NMW and the other parent will have to earn set hours at NMW too (set hours according to the age of the youngest child) to avoid the Universal Credit conditions.

If the 2 children in your example are teenagers, then under UC, the parents will be required to earn 70 hours per week at national minimum wage, between them (70 x £6.31 = £441.70 per week) to avoid UC conditions. Or they could base their UC claim on them earning £441.70 per week from self employment (even if they didn't) to avoid the UC condititons: which would reduce the amount of benefit they would be given from 'the one benefit payment' UC. They could still claim Child Benefit in full as it is not part of Universal Credit, but is part of the Benefit Cap for those that don't work.

It's all part of making parents do more to support their own children.

Charityworker

I cant see how they are going to encourage people to start businesses doing that. Even the best businesses can make a loss in the first 2 to 3 years.