Sick to death of being scared of UC

A question about : Sick to death of being scared of UC

I am doing as much research as I can to try and figure out what the hell is going on with UC and how it will affect me, but cannot seem to find any concrete information.

I imagine a lot of people on these boards are in a similar boat to myself - self employed with a school age child. I'm also a single parent.

I had a letter from Concentrix a few weeks ago wanting me to send in everything but the kitchen sink to prove i'm actually self employed. Whilst it had me worried sick incase I didn't have enough evidence and they stopped my WTC, it's actually the best thing that could have happened as it's made me re-address everything and start to try and plan properly for the future (Still waiting on a decision from them)

I earn less than MNW for the hours I work (16 hours) And basically i'm trying to find out in a simple way what is going to happen to me when i'm moved over to UC. I'm terrified that my payments will stop.

Can anyone tell me if i'm not earning 16 x Ј6.50 from April 2015 (Or from when i'm put on UC) will my self employment be seen as a hobby and i'll be forced to find a job that equates to 16 x Ј6.50, or if in fact they simply assume i'm earning 16 x Ј6.50 and reduce my payment accordingly? It appears that under UC you need to log your monthly income etc.. Well surely people could simply lie and say they where earning MNW for every hour they work?

I'm confused, I just can't seem to find a definite answer as to whether you are still allowed to continue trying to grow your SE business and you have to simply accept the fact that your UC payments will be based on you earning NMW or whether they decide your business isn't viable and force you to shut it down and find employed work that equates to NMW?

The whole process terrifies me as nothing appears to be set in stone, I feel like i'm in limbo. All this talk of start up periods etc.. I haven't a clue what most of it means.

In all honesty, if Labour get in, do you think UC will still be pushed ahead or is there a chance of things staying as they are under tax credits? I understand people take the xxxx out of the system pretending to be SE when they are not, but what about genuine people like me who are trying their hardest to create a decent living but aren't quite their yet?

If anyone can simply explain how things are going to work i'd b so grateful as I need to really get my thinking cap on as to whether I should pack it all in and get myself to Uni, as unfortunately without some further education there's no way i'll get anything more than a NMW job and then i'll still be reliant on UC long term. I only want this to be a short term thing for me as i'm sick of this feeling of worry.

Best answers:

• There is a lot of information on the internet. Here is just one link which gives an outline:
  https://www.moneyadviceservice.org.u...-self-employed
  You are quite right that you will need to earn 16 hrs at NMW to get your full UC entitlement and will be penalised if your self employment is not earning this much (There is some leeway for new businesses and for the transition)
  Without wishing to be judgemental is there any reason why you can't find a job for 16 hrs at NMW now that you have a school age child?
  The new way of looking at the self employed under UC is because it is believed that it is being used as a 'cop out' for some people who are claiming tax credits etc because there business is not making a profit. This will change under UC.
  You need to take a close look at your business and see if you can make a profit which fits in with income/hours criteria.
  How many hours are you working at it? What are you doing? Is it viable or not?
  So, you are right to be concerned.
  Your options are:
  Make your self employment work.
  Look for a job as an employee and/or
  Do some training/further education which will help with future employment. (This doesn't have to be university)
  Stop being sick to death of being scared and do something about it (said in an encouraging tone, rather than being judgemental!)
  No one knows what is going to happen in the future, but, regardless of this ,do you really want to be reliant on benefits and the uncertainty of their future?
• The treatment of self-employed under UC is already in legislation. The uncertainty is knowing when an individual will move to UC as the roll out plans are only given just before it moves to another area.
  So you may move to UC anytime in the next few years to 2019. It depends on how they continue the roll out.
  However, once you are in UC, what happens depends on your circumstances. If you are in the 'all work group' then you will be required to earn 35 hours x NMW from your self-employment (or less hours depending on your circumstances if they agree it should be less) If you don't you will be treated as if you do (called the Minimum Income Floor) and your UC will be based as if you are earning that amount. So it won't take account of what you actually earn each month. There are some proposals to allow carry forward of losses/offset of profit but that won't change the fact that the minimum income floor applies.
  The only exceptions to this are if you are not in the all work group - so you have small children (i think it is under 5), have disabilities that put you in a different group, caring responsibilities etc....
  IQ
• That's going to catch quite a few of the self employed small businesses.
• It's the most appalling set of regulations that will strangle a lot of people trying their best to work.
  The idea you now have to submit your accounts every month as well as a second set once a year for tax comes across as ridiculous.
  And the whole "not being able to offset costs etc" is madness. By it's very nature most small business/self traders have varying incomes, so the idea that people can make everyone nice and tidy for UC just isn't going to work imo.
  It's just a way of putting more hurdles in front of those people genuinely trying to earn a living.
  You only have to Google 'Self employed and UC' to see a lot of people are aren't sold on how well this is going to work.
  https://www.litrg.org.uk/News/2013/UC_scrutiny_SE
• Many thanks for taking the time to reply.
  pmlindyloo You are absolutely right, and no way on earth do I want to be reliable on any kind of benefit, particularly as the future regarding them is so uncertain, but I don't want to go and work for anyone else for a number of reasons, the first one being that I am a trained Actress, this was my bread and butter before I became a Mum, then it took a back seat whilst I tried to set up a business so that I had a more stable income coming in (What a joke that has turned out to be, not hitting NMW yet and the business is 3 years old) I studied for 3 years at Drama school and it's my passion, I want to get back into this line of work and can't if I work for someone else. No one is going to allow me time off for castings and productions. So, what am I supposed to do? Is this government telling me I have to get a job and give up any hopes of being SE? Or can I continue to be SE but accept the fact that my UC will effected if i'm not hitting NMW? I'm still not clear on that. For what it's worth Theatre work is fairly well paid, so in the hope I can get back into it then maybe I could come off tax credits/UC but this is a long shot.
  I also volunteer one day a week as i'm trying to get my foot in the door in another area (media related) I have two work experience placements coming up and i'm hoping this may lead to some freelance work, but obviously this isn't set in stone. I totally and utterly resent the fact that I can't try and persue a better life for myself and my Daughter and that I have to go and get a 16 hour minimum wage job, what a waste my training will have been. Obviously this statement doesn't apply if I can still run my business even though i'm not earning NMW and still receive some UC whilst i'm trying my hardest to get myself out of this trap that I feel i'm in.
  I feel so strongly that if you are running a genuine business, but aren't quite hitting minimum wage, then you shouldn't be penalised. How is this fair or moral? The way it stands now i'd still be entitled to more or less the same amount of tax credits if I were earning NMW and working for someone else for 16 hours a week, so how does it make sense?
  I hope this car crash is pulled before it's too late. Hope to god Labour get in and revoke it. I totally understand and accept something needs putting in place to prove you're genuinely self employed (such as this Concentrix check going on) But to penalise people who are trying to create a business that takes time to grow is wrong.
• Labour won't change it.
• Theatre work inevitably means unsociable hours and often travel too. How would you do that when you have no childcare outside school? I know a few actors and they barely break even with the theatre work they do, they do it to improve their skills whilst making their money from tv work.
  It's great to follow your dreams, I wouldn't want to discourage anyone from doing so, but you need to be realistic as to where that dream is going to lead you.
• "The problem is that some self-employed people have abused the system in tax credits and spoilt it for everyone else."
  No imo It's about saving money and further pushing Darwinian approach to society.
  Funny how they bang on about having to earn a certain amount of hours at minimum wage, when many large companies are currently getting away not doing that, via zero contracts and other scams that the government and big business seem quite happy to keep supporting, (big surprise I know) but god forbid an individual tries better themselves and doesn't manage to hit these targets on a regular basis.
• The reality is as you are describing it, you are arranging your self-employment around what suits you as a single mother, rather than the other way around. Very few people manage to make a living out of a business that has been set up to fit around their other priorities. The question I would have is: if you are genuinely dedicated to growing your business so that it can support you and your child at some point, why sticking to 16 hours? What business can trully be sustained on so few hours? Your DD is at school, so what is stopping you putting as many hours as possible into it so that it can take you to NMW?
  Unfortunately, children do have this habit of putting a damper on career plans and most parents end up with jobs they wouldn't have chosen if they could have afforded to devote themselves to their career rather than earning money to support their family. Tax payers can't continue to support businesses that are only set up to claim tax credits whilst giving absolutely nothing back.
  You are doing the right thing though by preparing yourself, but that might have to come with accepting you can't make your income fit around the jobs/activities you want for yourself but will have to compromise in some ways.
• I do admin work for several small businesses and manage to produce monthly budget accounts for them. It's in their own interests to know how they stand financially.
  Nothing worse than a business that only produces accounts when they are forced to by the HMRC deadlines.
• I am busy working right now but will be back to reply to comments. Thanks to those who are helping me to understand what it means for me.