Not Eligible for Universal Credit

debtslave2024

I filled out the “turn 2 us” universal credit calculator, and was surprised to get the following response:

“Based on the information you have given us, you aren’t eligible to get Universal Credit because your savings or capital is too high.”

I am currently living off roughly £600 self employed monthly employment income that will most likely be cut to zero within 6 weeks. I currently have saving just under £2000, but that wont last long once my income is removed. I own my small property outright.

Is this due to the so called “minimum income floor” for self employed? If it is I thought there was inititially a 12 months grace period.

Can someone please explain, why I am eligible for nothing?

Newcad

The calculators can only work with the information that you give them, so is there any chance that you may have made an error?

It's saying that your "Savings or Capital" is too high to qualify, so it's not income or the Minimum Income Floor that it's saying is the problem.

Did you say that you own any property other than your home? (You don't include your home where you are living as capital).

 A poperty that you rent out. a holiday home, maybe abroad, anything like that?

Try doing the same calculation using the Entitledto calculator, it asks the questions in a slightly different way.

debtslave2024

@Newcad. I will try the “Turn to Us” calculator again, to try and iron out any potential mistakes. The Entitled to calculator, needs stuff like income tax paid during the tax year, which I do not have at right now. Oddly, I cannot remember the “Turn to us” calculator even asking for income tax.

Newcad

Again, the turn2us calculator said it was your capital that was the issue, not your income. (so not income tax either).

sheramber

 did you maybe type £2000 as £20,000?

debtslave2024

Filled it out repeatedly always the same answer. Ive spent hours on this today (researching problems,) when I should actually urgently be applying for other jobs. 

I noted 2 possible issues. The calculator says the “The value of this property will be taken into account when working out your benefits.” I have no idea why the value of your house matters, mine is a small flat, not worth much by today’s standards. 

The other red flag was the following question: “Have you been self employed for less than 12 months?.” For me the answer is NO. I believe this question is designed to assess if the Minimum Floor Income applies to you (12 months grace period.)

HillStreetBlues

Did you try https://www.entitledto.co.uk/

Spoonie_Turtle

Do you live in the property you own?

debtslave2024

@HillStreetBlues, it asks for NI, and income tax paid in current tax year, I am outside just now, and do not have it at hand. Will set reminder to try later.

I have a funny feeling the Minimum Income Floor for self employed is the problem here, and the 12 month grace period (I am not entitled to this grace period, as have been self employed for some years.)

debtslave2024

I asked AI to assess my eligibility based on a document I provided it, with regards to universal credit, given I have been self employed over a year. This was the response:

Since you've been self-employed for over a year, your 12-month grace period has already ended. This means that Universal Credit will apply the Minimum Income Floor (MIF) to your claim.

How the MIF Affects Your Eligibility:

1. Assumed Earnings:

   • Instead of using your actual income (£600/month), Universal Credit assumes you earn at least the MIF amount.

   • For a single adult over 21, the MIF is typically based on 35 hours per week at minimum wage (currently £1735/month in 2024/25).

   • Even if you earn less, they will still count £1735/month as your income.

2. Impact on Universal Credit Calculation:

   • Since UC is means-tested, your benefit amount is reduced based on how much you "earn."

   • Because the MIF assumes you make £1735/month, this is likely too high for you to qualify for UC, even though your real income is much lower.

What Can You Do?

• Check if you qualify for an MIF exemption (e.g., health conditions or caring responsibilities can reduce the hours used to calculate the MIF).

• Request a reconsideration if you believe your business has genuine fluctuations in income.

• Look into other benefits, such as Council Tax Reduction (some councils apply a different MIF or don’t use it at all).

HillStreetBlues

debtslave2024 said:

@HillStreetBlues, it asks for NI, and income tax paid in current tax year, I am outside just now, and do not have it at hand. Will set reminder to try later.

I have a funny feeling the Minimum Income Floor for self employed is the problem here, and the 12 month grace period (I am not entitled to this grace period, as have been self employed for some years.)

I'm not up on the MIF, what's puzzling and as referred too above is the reason you been given (capital).