Recovering- moving from ESA support group to start own business -help!

Gold_finch

Hi, 
(Edit- I'm in Scotland)
I have been receiving ESA and PIP due to severe disability. In recent months I recovered enough to be able to start my own business. I no longer receive PIP since it was due for reassessment and I no longer meet the criteria. I still receive ESA (support group) but need to notify them of the change in my health. 

I'll be a sole trader and my business will bring in very little money to begin with. Do I apply for universal credit instead? What support is available there? Do I just call ESA and say that my condition has improved and I want to switch to a working benefit? 

I live alone. I did the benefits calculator on turn 2us and it said I could receive just over £200 a month, which isn't enough for my mortgage/bills/food if I don't earn that month. 

Any help that anyone can offer me would be really appreciated, it's all a bit of a minefield and I'm keen to let the DWP know as I can't properly start trading until I do. 

Thanks x

poppy12345

Permitted work is possible but you must work less than 16 hours per week and earn no more than £140 after deductions per week.

https://www.entitledto.co.uk/help/Permitted-Work-Rules

If you'll be earning more than this then claiming Universal Credit maybe possible depending circumstances. Your ESA award will be honoured in UC and you'll be placed into the LCWRA group. Although if you have savings/capital of more than £16,000 you'll be excluded from claiming.

If any part of your ESA is contributions based then you'll keep this and it will be deducted in full from any UC entitlement.

Although saying all of this, if your condition has improved enough that you no longer need to claim ESA then you should report the changes.

Spoonie_Turtle

When you did the benefits calculator, did you include your ESA and health situation?  If so, that £200 might possibly be after they've deducted what you currently receive from ESA.  Do you have any savings/capital?

You can do a manual calculation for UC using the information here https://www.understandinguniversalcredit.gov.uk/new-to-universal-credit/how-much-youll-get/

Are you sure your health has improved so much to not be entitled to ESA, or might you be put in the WRAG instead of the Support Group rather than not being eligible at all?  The answer to that would make a difference to how UC would work for you as well, because being self-employed on UC is a bit complicated after 12 months. If you were assessed as having LCW (equivalent of WRAG) it would actually make self-employment on UC simpler.

There is no help available for paying off a mortgage by the way, only a loan to pay the interest if you've been on UC without earned income for 9 consecutive months, and as soon as you earn anything that 9 months resets.

Gold_finch

Thank you ☺️
It's actually rent, I don't know why I wrote mortgage , sorry🤦🏼‍♀️

I wouldn't be able to run my business as permitted work because my activities are in conflict with what my disabilities were,  I'll need to be very open about the level of my recovery which might exclude me from WRAG,  but i guess if I tell them my current issues the I might get into that group. I do still have various issues that make it impossible for me to work full time, which is why I'm starting my business rather than just going and getting another job. I think being in the startup period for being self employed sits best with me. 

I'm confused because on the gov website it says that the standard payment is £409.89, yet the benefits calculator said just over £200. 

I don't have any savings but I do receive a small pension of £300 a month, could it be that?

Really appreciate your thoughts, thank you x

Edit- I didn't include any disability when I did the benefits calculator

poppy12345

Gold_finch said:

I don't have any savings but I do receive a small pension of £300 a month.

I'm assuming that your ESA is either Contributions based or New style ESA? because your pension will affect the amount of income related ESA you're entitled to. Like Income Related ESA your pension will reduce the amount of UC you're entitled to £1 for £1, which is very likely why the calculator only stated £200.

For New style ESA/contributions based any pension of up to £85 is ignored. Over this amount and your ESA will reduce by 50p for every £1 over that amount.

Gold_finch

poppy12345 said
I'm assuming that your ESA is either Contributions based or New style ESA? 

It is contributions based. That's a bit depressing  but makes sense, thanks 

poppy12345

Also Contributions based ESA isn't part of UC and if you moved to the WRAG instead of the Support Group it's only paid for 1 year. Although the ESA will be deducted £1 for £1 from any UC entitlement.

Spoonie_Turtle

Oh, yes the pension would explain why entitlement would be so low.

You'll only be entitled to either the one bedroom rate if you privately rent (assuming you're over 35?) or if you're a social tenant the whole of your rent unless you have more than one bedroom.  You can look up weekly rates here: https://lha-direct.voa.gov.uk/
To convert to monthly amounts, it's weekly rate x 52, ÷12.

If you are assessed as having LCW for your health issues, you would be exempt from the MIF and would be entitled to the work allowance (currently £292 if you're renting) which is the amount of earnings they ignore before making deductions.  This only applies to earned income though, not pensions.

calcotti

Spoonie_Turtle said: You'll only be entitled to either the one bedroom rate if you privately rent (assuming you're over 35?) 

Given they're getting a pension I think that's a safe assumption!

Spoonie_Turtle

calcotti said:

Spoonie_Turtle said: You'll only be entitled to either the one bedroom rate if you privately rent (assuming you're over 35?) 

Given they're getting a pension I think that's a safe assumption!

haha true! Evidently I didn't join those two dots! 

Gold_finch

To be fair, I retired when I was 34 because of ill health so it was a fair question!