Benefits following a period of self-employment

tightauldgit

I'm in the process of winding down my business and will be completely done in a couple of months. I'm not quite sure what I am going to do next and planning to take some time to work out what I want to do. Am I right in thinking that I'm not able to make any claims on contribution-based benefits based on my NI contributions when I was self-employed?

I know I can claim UC but my savings means I won't get anything as i'm over the limit.

So as far as I can see I am entitled to nothing for the time being? Would that be right? 

poppy12345

If you're looking for work and have the correct NI contributions in tax years 2020/21 and 2021/22 then you can claim New style JSA. As self employed you will need class 2 NI contributions. JSA will pay £84.80/week for 6 months but you need to be looking for work to claim it. https://www.gov.uk/guidance/new-style-jobseekers-allowance

You can check your NI record here. https://www.gov.uk/check-national-insurance-record

tightauldgit

poppy12345 said:

If you're looking for work and have the correct NI contributions in tax years 2020/21 and 2021/22 then you can claim New style JSA. As self employed you will need class 2 NI contributions. JSA will pay £84.80/week for 6 months but you need to be looking for work to claim it. https://www.gov.uk/guidance/new-style-jobseekers-allowance

You can check your NI record here. https://www.gov.uk/check-national-insurance-record

The guidance for New Style JSA says that it's only available if you have Class 1 contributions - Class 2 apparently don't count. I have made the relevant contributions but it doesn't seem to help.

https://www.gov.uk/jobseekers-allowance/eligibility 

poppy12345

tightauldgit said:

poppy12345 said:

If you're looking for work and have the correct NI contributions in tax years 2020/21 and 2021/22 then you can claim New style JSA. As self employed you will need class 2 NI contributions. JSA will pay £84.80/week for 6 months but you need to be looking for work to claim it. https://www.gov.uk/guidance/new-style-jobseekers-allowance

You can check your NI record here. https://www.gov.uk/check-national-insurance-record

The guidance for New Style JSA says that it's only available if you have Class 1 contributions - Class 2 apparently don't count. I have made the relevant contributions but it doesn't seem to help.

https://www.gov.uk/jobseekers-allowance/eligibility 

Ah yes, i'm thinking of New style ESA. My apoloigies for incorrect information. This means there's no benefits you can currently claim.

The maximum savings limit for UC is £16,000. For every £250 or part there of over £6,000 there's a £4.35/week deduction. If you live with a partner you'll need to claim as a couple.

tightauldgit

poppy12345 said:

tightauldgit said:

poppy12345 said:

If you're looking for work and have the correct NI contributions in tax years 2020/21 and 2021/22 then you can claim New style JSA. As self employed you will need class 2 NI contributions. JSA will pay £84.80/week for 6 months but you need to be looking for work to claim it. https://www.gov.uk/guidance/new-style-jobseekers-allowance

You can check your NI record here. https://www.gov.uk/check-national-insurance-record

The guidance for New Style JSA says that it's only available if you have Class 1 contributions - Class 2 apparently don't count. I have made the relevant contributions but it doesn't seem to help.

https://www.gov.uk/jobseekers-allowance/eligibility 

Ah yes, i'm thinking of New style ESA. My apoloigies for incorrect information. This means there's no benefits you can currently claim.

The maximum savings limit for UC is £16,000. For every £250 or part there of over £6,000 there's a £4.35/week deduction. If you live with a partner you'll need to claim as a couple.

Yeah I think that's the case. 

huckster

This makes sense, as the New Style JSA is for those previously employed, who need help while searching for new work, while those self-employed should have in theory been putting money to one side to help them while they search for other work. And of course both employed and self-employed with relevant NI records can claim New Style ESA as health reasons have suddenly stopped them being able to work, so they did not have time to plan their finances to cover the period they could not work.

If you are stopping self-employed trade, it is worth looking at local help available. Most local Council Authorities have websites with lots of good information about where to find help with Career development, business/self -employment help, education/skills courses etc.

tightauldgit

huckster said:

This makes sense, as the New Style JSA is for those previously employed, who need help while searching for new work, while those self-employed should have in theory been putting money to one side to help them while they search for other work. And of course both employed and self-employed with relevant NI records can claim New Style ESA as health reasons have suddenly stopped them being able to work, so they did not have time to plan their finances to cover the period they could not work.

If you are stopping self-employed trade, it is worth looking at local help available. Most local Council Authorities have websites with lots of good information about where to find help with Career development, business/self -employment help, education/skills courses etc.

It doesn't really make sense - if it's contribution based and you make your contribution then what does it matter where the contribution came from? Also there's no real reason why someone self-emplyed should be more able to 'put something aside' than someone in employment. Quite the opposite probably since if someone is stopping being self-employed I'd say there's a good chance that the business hasn't been going dambusters in recent times. 

But if that's the rules that's the rules. 

I have had previous issues with mental health which may impact my ability to work in full-time employment but to be honest given the little bit I know about ESA I doubt it would be an easy thing to claim so I will probably avoid it. 

NedS

tightauldgit said:

huckster said:

This makes sense, as the New Style JSA is for those previously employed, who need help while searching for new work, while those self-employed should have in theory been putting money to one side to help them while they search for other work. And of course both employed and self-employed with relevant NI records can claim New Style ESA as health reasons have suddenly stopped them being able to work, so they did not have time to plan their finances to cover the period they could not work.

If you are stopping self-employed trade, it is worth looking at local help available. Most local Council Authorities have websites with lots of good information about where to find help with Career development, business/self -employment help, education/skills courses etc.

It doesn't really make sense - if it's contribution based and you make your contribution then what does it matter where the contribution came from? Also there's no real reason why someone self-emplyed should be more able to 'put something aside' than someone in employment. Quite the opposite probably since if someone is stopping being self-employed I'd say there's a good chance that the business hasn't been going dambusters in recent times. 

Class 2 NI contributions paid by self employed people are (were) significantly less than class 1 contributions paid by an employed person. To be equivalent, as a self employed person you would have to pay a higher rate of NI AND you'd have to pay the equivalent employer contribution too as you are effectively the employee and the employer. So in theory you could have been putting the difference aside for a rainy day.

Spoonie_Turtle

tightauldgit said:

huckster said:

This makes sense, as the New Style JSA is for those previously employed, who need help while searching for new work, while those self-employed should have in theory been putting money to one side to help them while they search for other work. And of course both employed and self-employed with relevant NI records can claim New Style ESA as health reasons have suddenly stopped them being able to work, so they did not have time to plan their finances to cover the period they could not work.

If you are stopping self-employed trade, it is worth looking at local help available. Most local Council Authorities have websites with lots of good information about where to find help with Career development, business/self -employment help, education/skills courses etc.

I have had previous issues with mental health which may impact my ability to work in full-time employment but to be honest given the little bit I know about ESA I doubt it would be an easy thing to claim so I will probably avoid it. 

At the moment assessments are taking a very long time, so if your Dr will issue a fit note confirming your mental health issues you could claim.  By the time they get round to assessing you, you might have worked out what to do anyway or even finished claiming (because the 12 months has ended, or you're working again).

Incidentally you could have only claimed JSA if you were actively seeking work, and the same applies to UC unless you reported your mental health issues and had a work coach who turned off work search requirements because of it.  If it 'only' impacts your ability to work full time it's more likely that's have reduced work search requirements or done nothing at all and you'd be required to search for work full time.  ESA could be the middle ground you need, if a sort of breather would be beneficial to your mental health.

*N.B. for the irrationally jealous cynics who occasionally pop up on this board I am NOT advising anyone to apply fraudulently.  The only reason ESA might be possible is the OP having had genuine mental health issues.

tightauldgit

Spoonie_Turtle said:

tightauldgit said:

huckster said:

This makes sense, as the New Style JSA is for those previously employed, who need help while searching for new work, while those self-employed should have in theory been putting money to one side to help them while they search for other work. And of course both employed and self-employed with relevant NI records can claim New Style ESA as health reasons have suddenly stopped them being able to work, so they did not have time to plan their finances to cover the period they could not work.

If you are stopping self-employed trade, it is worth looking at local help available. Most local Council Authorities have websites with lots of good information about where to find help with Career development, business/self -employment help, education/skills courses etc.

I have had previous issues with mental health which may impact my ability to work in full-time employment but to be honest given the little bit I know about ESA I doubt it would be an easy thing to claim so I will probably avoid it. 

At the moment assessments are taking a very long time, so if your Dr will issue a fit note confirming your mental health issues you could claim.  By the time they get round to assessing you, you might have worked out what to do anyway or even finished claiming (because the 12 months has ended, or you're working again).

Incidentally you could have only claimed JSA if you were actively seeking work, and the same applies to UC unless you reported your mental health issues and had a work coach who turned off work search requirements because of it.  If it 'only' impacts your ability to work full time it's more likely that's have reduced work search requirements or done nothing at all and you'd be required to search for work full time.  ESA could be the middle ground you need, if a sort of breather would be beneficial to your mental health.

*N.B. for the irrationally jealous cynics who occasionally pop up on this board I am NOT advising anyone to apply fraudulently.  The only reason ESA might be possible is the OP having had genuine mental health issues.

Well it's been 5 years since I last worked in full-time employment and part of the reason for giving it up was that I had issue with depression, anxiety and stress. While the issues haven't gone away I find being self-employed allows me to manage them in a way that full-time employment simply doesn't. Unfortunately what it isn't doing at the moment is paying the bills.

I suspect if I go back to employment then all that will happen is I would end up off sick again at some point so I'm kind of reluctant to do that. On the other hand if the system required me to look for work to get benefits then I would comply with the requirements and see how it went. 

I might look into ESA and see what the requirements are and maybe have a chat with the GP.