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Self-employed persons – Can I claim?

The simple answer is yes, assuming your earnings are sufficiently low enough.

Please note that the following section does not apply to non dependants that are self employed.

How do you determine my self employed earnings?

Your income and expenses will be estimated by reference to “an assessment period”. This period will be whatever is appropriate to determine the most accurate assessment of your on-going average weekly income. Usually we will require details of your income and expenses (your accounts) for the last twelve month period, but there are a number of exceptions to the rule.

I have been self employed for less than 12 months

We will determine your income based upon the period that most accurately represents your on-going earnings. Obviously it would be inappropriate to ask for 12 months accounts as this could place in you financial hardship.

I have only just set up my business

Obviously you will not have any accounts as yet, therefore we will need to estimate your self employed income based upon the information that you can supply to us about your likely income and expenditure. We will send you a pro-forma to complete and we will make an interim assessment which we will review after a 3 month period, by which time you will have some idea of your income and expenses.

Please note that the self employed income pro-forma is available to download in our Claim Forms and Pro-forma section.

I have just suffered a detrimental business event

If you have recently lost a major customer, changed to short working hours, or suffered any other detrimental event that has affected your earnings, you will need to advise the Council of the date that the event occurred and we will take this into consideration when estimating your on-going earnings. We will also need income and expenditure details that are representative of your new circumstances. Should these business circumstances change for the better, we will again need to know when the change occurred, and what your new income and expenses are.

Can you go back to revise your estimates at a later date?

Once we have decided your self employed earnings we will not go back and reappraise them unless the decision we made was incorrect due to a misunderstanding of fact or law, or because we made an official error, or because you have notified us of a relevant change in your circumstances. We simply will not reassess the benefit you have received when we receive your next years accounts unless there is significant reason to believe that you misrepresented your income in order to claim additional benefit, in which case you may have been overpaid benefit which we would seek to recover from you.

Income, Capital and Expenses

We will only take into account the income that you have derived from your employment. Any other form of income into your business will be treated dependant upon what it is and in accordance with the benefit regulations.

The assets of your business, whether wholly or partly owned by you, are disregarded as capital whilst the business is trading and the assets are held by business during the course of its business. If your business has ceased trading we will allow a suitable period for you to dispose of these assets before we consider them to be your capital assets. If you are sick or disabled we will also disregard your business assets for as long as is reasonable for you to return to your self employment.

The treatment of employment expenses are dealt with dependant upon the nature of the expense incurred. The types of expenses that are deemed allowable or not are numerous and complex, and we will notify you when we make our decision about your self-employed earnings as to what expenses we have allowed in your assessment.

Pension Contributions

If you are making contributions into a personal pension scheme or an annuity for a retirement pension for yourself or your partner (assuming the scheme is approved by the Inland Revenue as eligible for tax relief), we will deduct half of the contributions from your gross self employed earnings. We cannot deduct lump sum contributions made.