Have to register a company for research; do I need to let DWP know?

Hi,

Both me and my wife are disabled, in receipt of PIP and benefits are our only source of income. I've had a couple of ideas for ventures that a university is interested in researching but they need me to register companies so they can gain funding for the research. The funds will never belong to me, I don't know if the ideas will ever be viable as a money making enterprise (and if they are, it's likely to be way down the line), and I won't be undertaking any work beyond the occasional decision about the way any research is done and meetings to discuss progress.

Will this have any implications for our benefits and do I need to let DWP know about registering the companies and the research being undertaken?

Thanks,
Chris
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Replies

  • CB1968 said:
    Hi,

    Both me and my wife are disabled, in receipt of PIP and benefits are our only source of income. I've had a couple of ideas for ventures that a university is interested in researching but they need me to register companies so they can gain funding for the research. The funds will never belong to me, I don't know if the ideas will ever be viable as a money making enterprise (and if they are, it's likely to be way down the line), and I won't be undertaking any work beyond the occasional decision about the way any research is done and meetings to discuss progress.

    Will this have any implications for our benefits and do I need to let DWP know about registering the companies and the research being undertaken?

    Thanks,
    Chris
     🙄😂🤣

    this sounds like money laundering rather than researching 
  • CB1968CB1968 Forumite
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    Well it's nice to get a helpful response to a genuine question. 🤷‍♂️
  • tacpot12tacpot12 Forumite
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    I doubt that there is a money-laundering issue here, providing you don't open a bank account in the company's name, and don't register anyone else as a director. (I would not make your wife a shareholder until the company has some assets). It does seem very odd that the university wants the IP to be vested in the company and not an individual. You might consult a solicitor that specialises in Intellectual Property (which you should be doing anyway) to see if this is normal.

    If there is any payment to be made to you for the intellectual property, it might be made as a capital payment to the company or as an income stream (perhaps on the basis of a licensing agreement). Until such payments commence, they won't affect any means-tested benefit income, but you do need to report that you are director of company. Any means-tested benefits will treat you as though you are self-employed, but if you are too disabled to work, then being self-employed shouldn't affect the amount of means-tested benefits you receive - I say "shouldn't" because this is an unusual situation (where someone is too ill to work, but still runs a business) - I can see why you are asking for advice. You should ask your local Citizens Advice to double-check any answers given here, including mine.

    The company should be setup to be dormant - you might need an accountant to confirm that this can be done from the outset. While the company is dormant, you won't have to pay fees to submit annual returns to Companies House or Corporation Tax returns to HMRC. Once a payment is to be made to the company, you can open a bank account, but I would expect that you would need pay yourself the at the level of the minimum income floor, and that this will affect the amount of means-tested benefits you receive. This means that there won't be a lot of benefit to you unless your ideas turn out to be very lucrative. You might consider if it wouldn't be better to give the intellectual property to the University or to a charity. 

    The company can make contributions to a pension scheme (which if your ideas are very lucrative could be a very good way to get money out of the  company). I would consult an accountant if the company is to receive any money, as you will need to change the status of the company from being dormant, and may need to set-up a payroll, and advice about bringing your wife into the business as a director so that she can also receive pension contributions.  
    The comments I post are my personal opinion. While I try to check everything is correct before posting, I can and do make mistakes, so always try to check official information sources before relying on my posts.
  • Spoonie_TurtleSpoonie_Turtle Forumite
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    Further to tacpot's answer, if you are in receipt of Universal Credit and have been assessed as having LCW or LCWRA, you would be exempt from the minimum income floor (because it only applies to people on the all work requirements group, which people with LCW/RA are not).
  • CB1968CB1968 Forumite
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    tacpot12 said:
    I doubt that there is a money-laundering issue here...

    Thank you for your response. I think I need to clarify that the reason I need to set up the company is because the funding model available to the university is European grant money that's only available to local businesses; I need a company registered to a local address to access that grant. In that respect, I don't think the IP is being dealt with, rather, the university needs a local named company because it gives them a pathway to funding. The question is (and I've asked the university to clarify), whether the grant becomes the property of the company and if I have any access to it, and how the DWP would class that grant if i cannot draw on those assets (if they were indeed, assets of the company).

    There is the potential for both of the ideas to prove very lucrative and at this moment I wouldn't wish to give the IP away, but I'm wary of pursuing research funding in the way the university is proposing if it messes up our benefits, as any income from the ideas is neither guaranteed nor likely in the short term.

    Finding anyone to advise me had proven difficult because the advice needed cruises so many areas of expertise, and or dealings with CAB have previously proven less than fruitful. Unfortunately, the nature of my disability makes it difficult for me to follow anything complex (I suffered a stroke which took away much of my working memory and executive function), but I have friends who are company accountants and they may be able to advise me with some of the issues you raise.
    As
  • CB1968CB1968 Forumite
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    Sorry, that post came out as a quotation and I can't find how to edit! 😕
  • calcotticalcotti Forumite
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    CB1968 said:
    Sorry, that post came out as a quotation and I can't find how to edit! 😕
    There should be a cog on the right hand side of the green stripe at the top of your post. Click on that and you should get a choice to edit or delete your post.
    Information I post is for England unless otherwise stated. Some rules may be different in other parts of UK.
  • CB1968CB1968 Forumite
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    calcotti said:
    CB1968 said:
    Sorry, that post came out as a quotation and I can't find how to edit! 😕
    There should be a cog on the right hand side of the green stripe at the top of your post. Click on that and you should get a choice to edit or delete your post.
    There doesn't seem to be... I'm using Ecosia (Chrome variant), on an Android tablet. 🤔
  • tacpot12tacpot12 Forumite
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    I'm using Microsoft's Edge browser and noticed that the cog disappears after the first edit, so if you tap on the far right-hand side of the green stripe, you may find that that you are able to edit your post in spite of the cog not being visible. 
    The comments I post are my personal opinion. While I try to check everything is correct before posting, I can and do make mistakes, so always try to check official information sources before relying on my posts.
  • calcotticalcotti Forumite
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    tacpot12 said:
    I'm using Microsoft's Edge browser and noticed that the cog disappears after the first edit, so if you tap on the far right-hand side of the green stripe, you may find that that you are able to edit your post in spite of the cog not being visible. 
    Sometimes I have to reload the page for the cog to become visible again after a first edit.
    Information I post is for England unless otherwise stated. Some rules may be different in other parts of UK.
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