Statutory Sick Pay (or New Style ESA) through my own limited company

cid_2

Hi - quick 2-point background:
1. I have my own limited company, sole employee/director and I do 3-12 month contracts for various clients. I've not worked since December but there are funds in the company.
2. I'm in the shielding category - I've had cancer before and it came back in March, so I'm pretty solidly classed as sick as a dog though I've not had the virus.
Now, I had a call from the Macmillan financial help people last week, recommending I either pay myself Statutory Sick Pay or apply for something called New Style Employment and Support Allowance. It looks like I'm probably eligible, but I don't know which if either I should go for.
From what I can gather from GOV.UK I'm able to pay myself SSP through the company for up to 28 weeks. I'd then be able to claim 2 weeks of that back from the government. Is that correct? If my company ends up paying for all but 2 weeks of it I'm not sure I see much point.
Similarly as my company has enough money to pay me a salary to cover my (lately greatly reduced) outgoings, I don't know whether it's right I apply for New Style ESA, or even if I'm allowed to since SSP is possible.
Nevertheless Macmillan assert I'm eligible to do something here. Can anyone offer any pointers?
Likely a niche concern I know so thanks very much for any replies to this, sincerely.

Icequeen1

My understanding is that you can only get New Style ESA if you can't get SSP or your SSP has ended. So i think you would need to claim the SSP as there is no reason why your company can't pay the SSP and then claim New Style ESA. You'll need to make sure your NI reord is sufficient for the new style ESA. 
Sorry to hear about your cancer reoccurence. 

calcotti

You are correct that of you pay yourself SSP the government does not generally reimburse this. There is a temporary provision to allow employers to recover a maximum of two weeks of SSP for employees who have coronavirus or are shielding. However I agree with you, that on the face of it, there seems little point in paying yourself SSP. Whether there are any accounting reasons to prefer taking money as SSP  than as a salary I simply don't know.

Claiming new style ESA while you are within your 28 week SSP entitlement (which starts from when you last worked) is problematic. You cannot claim the ESA if entitled to SSP and, in principle, your employer is required to pay you SSP. I don't know whether or not in practice a claim would be accepted. You could apply anyway and see what happens but I think you would have to provide a form SSP1 confirming that you are not entitled to SSP and why not and I don't think there is good reason for not being entitled. https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/870877/ssp1-interactive.pdf

Obviously if the company was closed it would not have to pay SSP but I get the sense from your post that closing the company is not something you would want to do.

Have you looked at entitlement to UC (if low income and savings below £16,000) or PIP (if your condition makes it difficult for you to carry out various specified tasks/activities)?

[Deleted User]

Both are options, neither are great though. 
SSP is £95.85 per week
nsESA is £74.35 per week for the first 13 weeks, then £74.35-113.55 per week after that. 

SSP is paid by your employer, in this case your own limited company, two weeks worth can be reclaimed per employee so would eat into your company's funds.
nsESA is paid directly by the government, to the individual, leaving the reserves in the business intact. 

You can also use the site below to see what else you might be entitled to, you can play around with various earnings limits to in relation to UC, you might want to keep paying yourself a small salary for example. 
https://www.entitledto.co.uk/

Personally I would take the nsESA route, keeping the funds in your company in reserve should you need them at a later date. 

JCS1

Check section E on the link calcotti has posted, if you haven't worked since December you need to check if you have PAYE earnings at the right level.

calcotti

MadMattUK said:

Personally I would take the nsESA route, keeping the funds in your company in reserve should you need them at a later date. 

But that doesn't address the question of whether OP is eligible for ns-ESA if he  is an employee with entitlement to SSP.

calcotti

JCS1 said:

Check section E on the link calcotti has posted, if you haven't worked since December you need to check if you have PAYE earnings at the right level.

Not sure that will work in terms of calculating entitlement to SSP because SSP is calculated based on the 8 week period prior to becoming ill. 

JCS1

calcotti said:

JCS1 said:

Check section E on the link calcotti has posted, if you haven't worked since December you need to check if you have PAYE earnings at the right level.

Not sure that will work in terms of calculating entitlement to SSP because SSP is calculated based on the 8 week period prior to becoming ill. 

The OP says not worked since December, and the illness came back in March.  Assuming there were no other payments, that would seem to rule out SSP?

calcotti

JCS1 said:

calcotti said:

JCS1 said:

Check section E on the link calcotti has posted, if you haven't worked since December you need to check if you have PAYE earnings at the right level.

Not sure that will work in terms of calculating entitlement to SSP because SSP is calculated based on the 8 week period prior to becoming ill. 

The OP says not worked since December, and the illness came back in March.  Assuming there were no other payments, that would seem to rule out SSP?

Depends on whether or not he continued to pay himself from company funds. I assume he has needed something to live off.

OP, if you were not paying yourself £120or more through a PAYE for 8 weeks prior to becoming ill in March then you do not qualify for SSP and could issue yourself an SSP1. You could then claim ns-ESA and can backdate it for 3 months provided you can get your GP to give you a Fit Note for this period. 

cid_2

Blimey, thanks very much for so many replies. I'll go through them properly tomorrow but I can clarify a bit more now in case it helps.

Since Christmas I have paid myself a regular salary and topped it up with dividends where necessary (in truth I think it's just been the salary). That salary I think is PAYE - at any rate I do pay PAYE tax to HMRC at various points in the year, presumably based off this regular salary. I'm fairly useless at understanding PAYE if I'm honest.

I've not paid anything to myself in relation to either the genuine illness or the COVID shielding.

I take it there's not some system whereby you pay yourself 28 weeks of SSP, then if you're still sick you can switch to the nsESA for a period? I can fairly well guarantee I'm going to be ill for some time to come yet, with no prospect of being able to work.

Thanks again, and apologies that I seem to be messing up the text spacing somehow..

calcotti

cid_2 said:  I take it there's not some system whereby you pay yourself 28 weeks of SSP, then if you're still sick you can switch to the nsESA for a period? 

That's exactly what should happen for an employee. They are entitled to 28 weeks of SSP from their employer and from the date their SSP entitlement ends are eligible for ns-ESA.

if you have savings below £16,000 you may be eligible for Universal Credit.