Self employed and universal credit

jennifer201386

Hello
Universal credit doesn’t apply to me yet but I’m currently self employed receding tax credits.
I have a four year old who’s in school and work 16 hours a week
My queries are listed below-
1. It’s my understanding that self employed applicants will have agreed the amount of hours that they can work which fit into my child’s school hours etc. I understand that this is for the minimum floor calculation. I’ve read different things on this topic some websites say I will need to work 16 hours, others say 20 and some say 24 hours, are you able to tell me which number is most likely ?
2. My other query is, I understand that the minimum floor is used to determine a persons supposed self employed income, so just for example let’s assume I need to work 20 hours a week which would give me a minimum floor of £8143 per annum, the bit that’s confused me is let’s say for argument sake that I earned £8500 but my mileage expenses came to a total of £1400 which would give me a gross income minus expenses of £7100. I want to know if the figure before expenses is used to work or my entitlement to universal credit or the figure after expenses. If the figure after expenses if used then it would appear I haven’t reached my minimum floor, which doesn’t seem fair, if this is the case would they base my income on the minimum floor of £8143 but not penalise me or ask me to earn more money or work more hours because they’ve used their common sense and realised that it’s gone on fuel?

Icequeen99

jennifer201386 wrote: »

Hello
Universal credit doesn’t apply to me yet but I’m currently self employed receding tax credits.
I have a four year old who’s in school and work 16 hours a week
My queries are listed below-
1. It’s my understanding that self employed applicants will have agreed the amount of hours that they can work which fit into my child’s school hours etc. I understand that this is for the minimum floor calculation. I’ve read different things on this topic some websites say I will need to work 16 hours, others say 20 and some say 24 hours, are you able to tell me which number is most likely ?
2. My other query is, I understand that the minimum floor is used to determine a persons supposed self employed income, so just for example let’s assume I need to work 20 hours a week which would give me a minimum floor of £8143 per annum, the bit that’s confused me is let’s say for argument sake that I earned £8500 but my mileage expenses came to a total of £1400 which would give me a gross income minus expenses of £7100. I want to know if the figure before expenses is used to work or my entitlement to universal credit or the figure after expenses. If the figure after expenses if used then it would appear I haven’t reached my minimum floor, which doesn’t seem fair, if this is the case would they base my income on the minimum floor of £8143 but not penalise me or ask me to earn more money or work more hours because they’ve used their common sense and realised that it’s gone on fuel?

In answer to your questions.

1. I don't think anyone can say how many hours your work coach will agree to. The MIF only applies if you are in the all work requirements group but it can be anything up to 35 hours a week.

2. MIF is based on net income (so income - expenses less deductions for tax, NI and pension contributions).

3. It is an automatic calculation. It isn't annual - it is per assessment period. If you don't earn that amount in any assessment period, they will use the hours x NMW less notional tax and NI and calculate your UC on that amount. No common sense to it.

IQ

jennifer201386

Thanks for your reply
I read somewhere that people with children in compulsory school age up to age of 13 will be expected to work 24 hours a week.
I was a bit confused by not earning the minimum floor due to mileage expenses, I read that if somebody doesn!!!8217;t achieve their minimum floor then they will be required to work more hours or achieve a better rate of pay.
This didn!!!8217;t seem fair when it!!!8217;s all going on fuel

pmlindyloo

This is a useful link about universal credit and the self employed>

https://www.moneyadviceservice.org.uk/en/articles/universal-credit-for-the-self-employed

Are you a single parent?

jennifer201386

Yes my child is 4

pmlindyloo

Quote from Universal Full Service Guidance

If a claimant has caring responsibilities for a child, they will generally need to show that they have reasonable prospects of finding work given any restriction to their availability. This is apart from the main carer (responsible carer) of a child under 13, who is able to restrict their availability to their child!!!8217;s normal school hours, without showing they have reasonable prospects of finding work, given this restriction. Travel time to and from school to collect children should be considered for any restriction.

pmlindyloo

And this is a link about what you report to UC each month as regards your self employment income:

https://www.litrg.org.uk/tax-guides/self-employment/working-out-profits-losses-and-capital-allowance/how-do-i-work-out-my-0

jennifer201386

Thanks for all your help
I!!!8217;m hoping I!!!8217;ll do 20 hours per week, all being well
What do you think will happen if you don!!!8217;t reach the minimum floor ? Will they expect you to try and do more hours or perhaps stop self employment
Also, do you have to declare milage for expenses or is it my discretion ?