Minimum numberof hours for self employed under Universal Credit

Enigmaman

I have just been forced to claim Universal Credit after being on Tax Credits for many years.

I am self-employed, have a disability, and have been struggling to work 30 hours per week. I have been receiving all the disability premiums.

I would like to cut down my hours, probably to 16 per week, but am unsure how the UC rules work. 

I know that under Tax Credits, if I did not work 30 hours I could not claim as a self-employed person.   

The DWP says no-one will be worse off for the first year (I believe) but where does that leave me with cutting down my hours? Can I reduce to 16 and still get the same money under UC? Or not?

How does this work?

huckster

Any other benefits e.g. ESA?

marcia_

Enigmaman said:

I have just been forced to claim Universal Credit after being on Tax Credits for many years.

I am self-employed, have a disability, and have been struggling to work 30 hours per week. I have been receiving all the disability premiums.

I would like to cut down my hours, probably to 16 per week, but am unsure how the UC rules work. 

I know that under Tax Credits, if I did not work 30 hours I could not claim as a self-employed person.   

The DWP says no-one will be worse off for the first year (I believe) but where does that leave me with cutting down my hours? Can I reduce to 16 and still get the same money under UC? Or not?

How does this work?

 Unlike tax credits universal credit does not have an hours requirement. It is based on your overall income each assessment period 

Enigmaman

marcia_ said:

Enigmaman said:

I have just been forced to claim Universal Credit after being on Tax Credits for many years.

I am self-employed, have a disability, and have been struggling to work 30 hours per week. I have been receiving all the disability premiums.

I would like to cut down my hours, probably to 16 per week, but am unsure how the UC rules work. 

I know that under Tax Credits, if I did not work 30 hours I could not claim as a self-employed person.   

The DWP says no-one will be worse off for the first year (I believe) but where does that leave me with cutting down my hours? Can I reduce to 16 and still get the same money under UC? Or not?

How does this work?

 Unlike tax credits universal credit does not have an hours requirement. It is based on your overall income each assessment period 

That's great news, then. Working 30 hours was too much. 

@Huckster I also get PIP.

huckster

You will be required to attend Job Centre Gateway Intervention appointment to verify the self employment information. You will need to explain to the Work Coach that you are receiving PIP and explain how your health/disability affects the number of hours that you are able to work.

The Work Coach can set the number of hours that it is expected you should be active with employment. Within Universal Credit legislation there are earnings thresholds e.g. Administrative Earnings Threshold £892 per monthly assessment period based on 18 hours per week National Minimum Wage.

The Work Coach should talk to you about a health journey under UC which includes a Work Capability Assessment. For this process you would need to submit Doctors fit notes or similar medical evidence stating that health affects the number of hours you are able to work. You don't have to agree to the health journey/work capability assessment process. However, you are then dependent on the Work Coach making decisions about what Universal Credit is expecting of you in regard to earnings.

There are 2 outcomes to the Gateway intervention appointment.

1) Not gainfully self employed. Meaning self employment, not organised or developed i.e.  not really being pursued to provide a good source of primary income based on your circumstances. 

2) Gainfully self employed. Meaning self employment is organised, developed or being developed; and being carried out in expectation of a profit. I.e. can provide a good primary source of income or within 12 months can be developed to provide a good primary source of income. Again based on circumstances.

If 1) is the outcome, you would be expected to search and apply for employed work and attend regular Job Centre Work search appointments. You can still do self employed work, but Job Centre will see it as secondary.

If 2) is the outcome, the Work Coach would apply a start up period of up to 12 months and apply an expected amount of earnings you need to achieve within the 12 months. The expected amount of earnings would be based on x number of hours per week at National Minimum Wage. It is important that you fully describe how your health impacts the number of hours you are able to work, so the Work Coach can take it into consideration. At the end of the 12 month period, a Minimum Income Floor based on the hours per week at National Minimum Wage would be applied. You would be required to attend self employment review appointments once every 3 months during the first 12 months.

So UC is perhaps better than TC, because the UC claim can be tailored to reflect personal circumstances, but you are reliant on the Work Coaches decisions. You can appeal the decisions if you feel they are unfair.

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

poppy12345

If this is a single person claim and you won’t have dependant children on your claim you will not have the work allowance. This means any earnings you receive each month will reduce your UC by 55%.

If you report your health condition, provide fit notes and are found to have either LCW or LCWRA you will have the work allowance. This means some of your earnings you receive will be ignored before deductions apply. If you claim for help with the rent it will be £404/month, if you don’t it will be £673/month.

You would also not be affected by the minimum Income Floor after 12 months if gainfully self employed, if found to have either LCW/LCWRA.
 

Information here about UC with a health condition. 

https://www.gov.uk/government/publications/universal-credit-if-you-have-a-disability-or-health-condition-quick-guide/universal-credit-if-you-have-a-disability-or-health-condition

Enigmaman

Thankyou for these very through answers.

Spoonie_Turtle

There is also potentially an issue of losing transitional protection if your first month of earnings are above a certain threshold (the AET?) and subsequently drop.  I don't understand it myself but am mentioning it in case those who do know about it can say whether it's likely to affect you or not.

Enigmaman

I think that scenario is unlikely in my case but thanks anyway.

8dayweek

Spoonie_Turtle said:

There is also potentially an issue of losing transitional protection if your first month of earnings are above a certain threshold (the AET?) and subsequently drop.  I don't understand it myself but am mentioning it in case those who do know about it can say whether it's likely to affect you or not.

Definitely could be a factor - as I understand it if Earnings drop below the AET* for three consecutive AP’s then Transitional Protection is removed. 

As a single person previously on WTC with Disability addition you are likely to have a fairly significant chunk of TP to account for the differences between UC and Tax Credits in your particular circumstances. 

*AET as it was at the point you migrated. It’s currently £892 for a single person.