Currently on Universal Credit - is it possible to run a small business at the same time?

the_tired_one

I'm hoping someone can advise me on this matter (it's for a relative).

He is married, not in work, 3 children under 12, currently on Universal Credit (for about 2 years) and living in a Council House and the rent is almost totally covered as is Council Tax.

He wants to know if he could open a small online business, mostly selling clothes on eBay.  Obviously income will vary/fluctuate.  Some weeks maybe no sales etc
He knows he would have to register at Companies House.

But how does it affect his Universal Credit and the various payments?  Is there a maximum amount he's allowed to earn? How does he inform them?  Is there a particular name for such a practice etc etc?  At the moment he is unable to phone them to ask due to the lockdown.

Is it even allowed under UC rules?  Any guidance/advice would be appreciated.  Thanks for reading

tboo

the_tired_one said:

I'm hoping someone can advise me on this matter (it's for a relative).

He is married, not in work, 3 children under 12, currently on Universal Credit (for about 2 years) and living in a Council House and the rent is almost totally covered as is Council Tax.

He wants to know if he could open a small online business, mostly selling clothes on eBay.  Obviously income will vary/fluctuate.  Some weeks maybe no sales etc
He knows he would have to register at Companies House.

But how does it affect his Universal Credit and the various payments?  Is there a maximum amount he's allowed to earn? How does he inform them?  Is there a particular name for such a practice etc etc?  At the moment he is unable to phone them to ask due to the lockdown.

Is it even allowed under UC rules?  Any guidance/advice would be appreciated.  Thanks for reading

What does his tenancy says about registering a business from the address

You would also need to enquire with the council itself re business rates etc

https://www.limitedcompanyhelp.com/are-you-allowed-to-run-business-from-home/

calcotti

https://www.gov.uk/self-employment-and-universal-credit

the_tired_one

calcotti said:

https://www.gov.uk/self-employment-and-universal-credit

That seems to be more biased to those already in self-employment and looking to go onto UC

calcotti

the_tired_one said:

calcotti said:

https://www.gov.uk/self-employment-and-universal-credit

That seems to be more biased to those already in self-employment and looking to go onto UC

The mechanism is the same though. There’s more detailed information here https://www.gov.uk/government/publications/universal-credit-and-self-employment-quick-guide/universal-credit-and-self-employment-quick-guide

the_tired_one

tboo said:

the_tired_one said:

I'm hoping someone can advise me on this matter (it's for a relative).

He is married, not in work, 3 children under 12, currently on Universal Credit (for about 2 years) and living in a Council House and the rent is almost totally covered as is Council Tax.

He wants to know if he could open a small online business, mostly selling clothes on eBay.  Obviously income will vary/fluctuate.  Some weeks maybe no sales etc
He knows he would have to register at Companies House.

But how does it affect his Universal Credit and the various payments?  Is there a maximum amount he's allowed to earn? How does he inform them?  Is there a particular name for such a practice etc etc?  At the moment he is unable to phone them to ask due to the lockdown.

Is it even allowed under UC rules?  Any guidance/advice would be appreciated.  Thanks for reading

What does his tenancy says about registering a business from the address

You would also need to enquire with the council itself re business rates etc

https://www.limitedcompanyhelp.com/are-you-allowed-to-run-business-from-home/

He looked into this. Ebay message boards advised that as long as any stock is kept indoors and not outside in a garage or property has not been adapted in anyway then no need to payany business rates.

He will look at the tenancy agreement as you suggested.
And he's looking into insurance matters etc

soolin

the_tired_one said:

I'm hoping someone can advise me on this matter (it's for a relative).

He is married, not in work, 3 children under 12, currently on Universal Credit (for about 2 years) and living in a Council House and the rent is almost totally covered as is Council Tax.

He wants to know if he could open a small online business, mostly selling clothes on eBay.  Obviously income will vary/fluctuate.  Some weeks maybe no sales etc
He knows he would have to register at Companies House.

But how does it affect his Universal Credit and the various payments?  Is there a maximum amount he's allowed to earn? How does he inform them?  Is there a particular name for such a practice etc etc?  At the moment he is unable to phone them to ask due to the lockdown.

Is it even allowed under UC rules?  Any guidance/advice would be appreciated.  Thanks for reading

Does he have a good reason for registering with companies house as a company and not just acting as a sole trader? 

the_tired_one

soolin said:

the_tired_one said:

I'm hoping someone can advise me on this matter (it's for a relative).

He is married, not in work, 3 children under 12, currently on Universal Credit (for about 2 years) and living in a Council House and the rent is almost totally covered as is Council Tax.

He wants to know if he could open a small online business, mostly selling clothes on eBay.  Obviously income will vary/fluctuate.  Some weeks maybe no sales etc
He knows he would have to register at Companies House.

But how does it affect his Universal Credit and the various payments?  Is there a maximum amount he's allowed to earn? How does he inform them?  Is there a particular name for such a practice etc etc?  At the moment he is unable to phone them to ask due to the lockdown.

Is it even allowed under UC rules?  Any guidance/advice would be appreciated.  Thanks for reading

Does he have a good reason for registering with companies house as a company and not just acting as a sole trader? 

I think he assumed he had to register as a company.  Bad advice given possibly. Does he have to register as a sole trader?

Spoonie_Turtle

the_tired_one said:

soolin said:

the_tired_one said:

I'm hoping someone can advise me on this matter (it's for a relative).

He is married, not in work, 3 children under 12, currently on Universal Credit (for about 2 years) and living in a Council House and the rent is almost totally covered as is Council Tax.

He wants to know if he could open a small online business, mostly selling clothes on eBay.  Obviously income will vary/fluctuate.  Some weeks maybe no sales etc
He knows he would have to register at Companies House.

But how does it affect his Universal Credit and the various payments?  Is there a maximum amount he's allowed to earn? How does he inform them?  Is there a particular name for such a practice etc etc?  At the moment he is unable to phone them to ask due to the lockdown.

Is it even allowed under UC rules?  Any guidance/advice would be appreciated.  Thanks for reading

Does he have a good reason for registering with companies house as a company and not just acting as a sole trader? 

I think he assumed he had to register as a company.  Bad advice given possibly. Does he have to register as a sole trader?

Only need to register with HMRC and that's if his trading income reaches £1000.

soolin

Spoonie_Turtle said:

the_tired_one said:

soolin said:

the_tired_one said:

I'm hoping someone can advise me on this matter (it's for a relative).

He is married, not in work, 3 children under 12, currently on Universal Credit (for about 2 years) and living in a Council House and the rent is almost totally covered as is Council Tax.

He wants to know if he could open a small online business, mostly selling clothes on eBay.  Obviously income will vary/fluctuate.  Some weeks maybe no sales etc
He knows he would have to register at Companies House.

But how does it affect his Universal Credit and the various payments?  Is there a maximum amount he's allowed to earn? How does he inform them?  Is there a particular name for such a practice etc etc?  At the moment he is unable to phone them to ask due to the lockdown.

Is it even allowed under UC rules?  Any guidance/advice would be appreciated.  Thanks for reading

Does he have a good reason for registering with companies house as a company and not just acting as a sole trader? 

I think he assumed he had to register as a company.  Bad advice given possibly. Does he have to register as a sole trader?

Only need to register with HMRC and that's if his trading income reaches £1000.

The details of the £1000 limit are here

https://forums.moneysavingexpert.com/discussion/6070793/1000-trading-allowance-is-made-clear-on-tax-return

£1000 turnover a year is easy on eBay, it’s only about £85 a month and includes all income including the postage element. 

the_tired_one

soolin said:

Spoonie_Turtle said:

the_tired_one said:

soolin said:

the_tired_one said:

I'm hoping someone can advise me on this matter (it's for a relative).

He is married, not in work, 3 children under 12, currently on Universal Credit (for about 2 years) and living in a Council House and the rent is almost totally covered as is Council Tax.

He wants to know if he could open a small online business, mostly selling clothes on eBay.  Obviously income will vary/fluctuate.  Some weeks maybe no sales etc
He knows he would have to register at Companies House.

But how does it affect his Universal Credit and the various payments?  Is there a maximum amount he's allowed to earn? How does he inform them?  Is there a particular name for such a practice etc etc?  At the moment he is unable to phone them to ask due to the lockdown.

Is it even allowed under UC rules?  Any guidance/advice would be appreciated.  Thanks for reading

Does he have a good reason for registering with companies house as a company and not just acting as a sole trader? 

I think he assumed he had to register as a company.  Bad advice given possibly. Does he have to register as a sole trader?

Only need to register with HMRC and that's if his trading income reaches £1000.

The details of the £1000 limit are here

https://forums.moneysavingexpert.com/discussion/6070793/1000-trading-allowance-is-made-clear-on-tax-return

£1000 turnover a year is easy on eBay, it’s only about £85 a month and includes all income including the postage element. 

Thanks.  I think he intends to make more than a £1000 per year so will have to register with Companies House / HRMC?