Universal credit UK: Self-employed eligibility explained as assessment rules change


Universal Credit payments for employed people or for those out of work are based on the claimant’s specific circumstances and for self-employed people, it will be assumed the claimant is earning the same amount as someone in similar circumstances who is in paid work. Eligibility for self-employed claims is based on separate assessment criteria.

The actual figure is worked out by multiplying the national minimum wage by the number of hours agreed to work with a work coach.

The minimum income floor rules are currently relaxed due to coronavirus but the original rules are set to be reintroduced in November.

Where a claimants earnings drops lower than their minimum income floor, Universal Credit will not make up the difference and they may need to look for additional work to top up income.

If earnings go above a minimum income floor, the Universal Credit payment will be based on actual earnings.

It should be noted that when applying, a gainfully self-employed person’s business assets will not be taken into account.

Nor will these assets be considered when the DWP work out payment entitlement.

Business assets can include machinery, premises and cash held in business accounts.

Where businesses have been affected by coronavirus, people may be able to receive support through the Self-Employment Income Support Scheme (SEISS) but this may impact Universal Credit payments.

So long as self-employed people claim Universal Credit, they’ll need to provide information on their income and earnings for each monthly assessment period.

This will include how much the claimant is earning, how much money is being paid into a pension and general information on the business.

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Payments into and out of the business during an assessment period will also need to be reported, with this including:

  • The total amount the business has received
  • How much the business spent on different types of expenses, such as travel costs, stock, equipment and tools, clothing and office costs
  • How much was spent on tax and National Insurance





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