Self Employed & Tax credits

mazzieb2806_2

Is there anyone here that can help or is in the same situation...

I am recently self employed (I have a illness that once I mention it, I never seem to get the job - so I decided to start my own business)
Any how - my husband is disabled and not able to work full stop, I knew we would be taking a massive drop in monies until the business was established and it could earn us both a healthy income.

I was told by CAB that I could claim tax credits whilst I was on a low income, but after applying for them I have had a chap ring me to say that they aren't there to subsidise a business - which I know that, its more to help me why my income is low, and then i'll be able to come off any benefits all together.

If that's the case and I cant get them, I literally will have nothing, I feel a bit miffed that whilst I am trying to come of benefits, they just seem so blas! about things. I am trying to do things right, but I cant help but feel now I have really hindered myself financially.

Does anyone know if that because my partner is disabled and cant work if he can claim contribution based ESA perhaps?

Any advice or help would be greatly appreciated. xx

Darksparkle

How many hours are you working per week?

Do you or your partner receive DLA/PIP?

Have tax credit is actually rejected your claim?

Caz3121

mazzieb2806 wrote: »

If that's the case and I cant get them, I literally will have nothing,

are you not expecting any income from the business?

some information here https://www.gov.uk/working-tax-credit/eligibility
in particular
Some self-employed people are not eligible for Working Tax Credit. To qualify, your self-employed work must aim to make a profit. It must also be commercial, regular and organised.
This means you may not qualify if you don’t:
make a profit or have clear plans to make one
Do you have a business plan that demonstrates that you would seeing a profit?

Marktheshark

The guy rang you as they have to try to make YOU throw the towel in by underhand methods.

Tax credits are governed by what is known as "statutory instrument" that is legalisation as in a government act that they are bound by law to obey.
Nothing in any tax credits legislation sets any upper or lower limits on self employment earnings.
The changes are "guidelines" not set in legislation.

If they refuse the complaint appeal on the very strict and narrow grounds that they must follow and obey statutory instrument of the tax credits legalisation not guidelines !
Inform them if they reject the appeal you will apply for judicial review of the decision and breach of legalisation.

The Tax credit changes are a scare tactic of guidelines to deter, once they work out you wont deter they will allow your claim, but will send compliance letters harassing you now and again, so keep all paperwork and copies.
When Universal Credit kicks in, you will have to sign back on if you are not earning NMW for 30 hours

For the flame mongers, I do not personally agree with the low self employment and top up idea but as an advice forum sticking to the correct answer and facts should come first.

mazzieb2806_2

I'll be working 37 hours, my husband receives higher DLA - I have notified DLA that I am working so I am expecting it to either stop or go to a lower tier. WTC haven't declined anything yet, they are wanting info which is fine, but he just seemed a little stern on things, like I was trying to blag them, but surely they can see that all I'm doing is trying to get out the benefit system.

And of course I am expecting the business to make money, however the first year of trading most business's run at a loss, just because of all the set up costs involved.

mazzieb2806_2

Caz I do have a business plan yes, which I have said i will send to them. The business is intended to make profit.

Darksparkle

DLA doesn't stop just because you start work. It's based on your care and mobility needs. So it may well continue unless your condition has improved.

If you are on DLA you are only required to work 16hrs per week, although get extra for working 30hrs.

A compliance check can be prompted by HMRC if you don't work earn your declared hours (37) x NMW. So currently £247.90. As it makes no difference to your claim whether you work 30 or 37, it may be better to just declare 30.

Yes businesses may run at a loss at first but as long as you can show a clear plan on how you expect to make a profit you should be fine.

You'd be surprised at the number of people that can't do this and do not take any action to improve their profits.

p00hsticks

Just for added clarity, as I misinterpreted this statement and others might too, I've added the bit in bold....

Darksparkle wrote: »

If you are on DLA, then to claim WTC you are only required to work 16hrs per week, although get extra for working 30hrs.

(But as it's not the OP on DLA, then it's not really relevant anyhow)

mazzieb2806_2

Thanks! I have a clear plan and do intend on it making a decent enough amount of profit, its just that initial when I kinda don't have anything.

Does anyone know if the tax credits covers me and my husband or can he claim contribution ESA whilst I am on a low income as he doesn't work?

Its a total mine field the benefit system x

mazzieb2806_2

i do currently receive DLA, i have sent in a form to notify i am working, but they have said it possibly wont change as my needs haven't really changed. x

Darksparkle

p00hsticks wrote: »

Just for added clarity, as I misinterpreted this statement and others might too, I've added the bit in bold....



(But as it's not the OP on DLA, then it's not really relevant anyhow)

The OP said they are on DLA? Perhaps you misread that?