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Self employment and benefits - Self employment and benefits: Frequently asked questions

If you or your partner are working, or thinking of starting work, as a self employed person you might qualify for welfare benefits to top up your income.

Self employment and benefits: Frequently asked questions

1) I am self-employed and struggling because of coronavirus. What help can I get?

If you are yourself sick with coronavirus or are self-isolating because a member of your household is sick, you may be able to get New Style Employment and Support Allowance, if you paid National Insurance contributions as an employee or self-employed person between April 2017 and April 2019. You may also be able to get Universal Credit. You can use our benefit calculator to work out how much Universal Credit you can get. People whose health is affected by coronavirus will not be affected by the minimum income floor. The minimum income floor reduces the amount of support self-employed people can get through Universal Credit.

If you are experiencing economic impacts from coronavirus or do not feel able to work because of the need to maintain social distancing, or aren’t able to work because you have to look after your children you won’t be treated as unwell. You may be able to get New Style Jobseekers Allowance, if you paid National Insurance contributions as an employee between April 2017 and April 2019. You may also be able to get Universal Credit. You can use our calculator to work out how much Universal Credit you can get.

The Chancellor has announced that the minimum income floor is to be suspended for people facing economic impacts from coronavirus, but the details of this have not yet been published. The Minimum Income Floor reduces the amount of support self-employed people can get through Universal Credit.

The Chancellor has announced that the amount of money people get through Universal Credit is to be increased. The standard allowance, which is paid to everyone getting Universal Credit, is going up by £1000 per year. This does not necessarily mean you will be £1000 per year better off, as there are a few steps to working out how much Universal Credit you can get.

On Thursday 26 March, the government announced a support package for self-employed people. The government will pay 80% of your usual self-employed income, up to a maximum of £2,500 per month. Only people who completed tax returns for the 2018-2019 tax year will be able to apply for this help. Applications open in June 2020, but grants will be backdated to the beginning of March 2020. 

2. Can I get self-employed Maternity Pay?

Statutory Maternity Pay (SMP) is paid by an employer when an employee leaves work to have a baby. If you are self employed, you cannot get Statutory Maternity Pay as you are working for yourself and therefore do not have an employer.

If you are self employed and temporarily unable to work due to having a baby, you should check if you qualify for Maternity Allowance.
 

3. I am self employed. Can I claim paternity benefits?

The main paternity benefit is Statutory Paternity Pay. This is paid by an employer to an employee who meets the qualifying conditions to cover a period of leave for a birth or an adoption. If you are self employed, you cannot get Statutory Paternity Pay as you are working for yourself and therefore do not have an employer.

4. Can I get self-employed Sick Pay?

Statutory Sick Pay (SSP) is paid by an employer when an employee is unable to work due to sickness. If you are self employed, you cannot get Statutory Sick Pay as you are working for yourself and therefore do not have an employer.

If you are self employed and temporarily unable to work due to illness, you should check if you have made enough national insurance contributions to qualify for New Style Employment and Support Allowance.
 

5. Can a self-employed person get any help to pay the mortgage on their home?

You will only be able to get help towards the mortgage interest payments on your home if you are entitled to one of the following benefits:

You cannot get Income Support, income-based Jobseeker’s Allowance and income-related Employment and Support Allowance if you work full time – i.e. work more than 16 hours or more per week, or your partner works more than 24 hours per week.

If you work part time and your earnings, other income and capital are low enough and you meet the other rules for these benefits, you might be able to claim a Support for Mortgage Interest loan.

To find out whether you can get one of these benefits, use our Benefits Calculator.

If you get Universal Credit, you can only claim a Support for Mortgage Interest loan if you have no earned income at all. 

6. Can I get any help growing/ starting my business?

New Enterprise Allowance is a scheme that is intended to help unemployed people start a business through business mentoring and a weekly allowance. You may be able to claim it if you (or your partner) get Jobseeker’s Allowance, Universal Credit, or Income Support as a single parent. You can only get it if you live in England, Scotland or Wales.

If you take part in the New Enterprise Allowance scheme, you will get access to a mentor and a weekly allowance paid at £65 a week for 13 weeks, then £33 per week for a further 13 weeks (up to a total of £1,274). There is also the chance to apply for a loan of up to £25,000 to help with business start-up costs.

To access the New Enterprise Allowance you should speak to your work coach.

See the Gov.UK website for more information on the New Enterprise Allowance

Updated: March 2020

 

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