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Help for the Self Employed

Self employed means that (typically) you are not employed under a contract. For example this can include taxi drivers, window cleaners, market traders and shop keepers.

What we need to work out how much benefit you are entitled to

If you have recently set up your business, we will ask for an estimate of the likely income and expenses for the business over the first few months of trading. This will help to pay your benefit sooner.

After the first few months we will ask you to provide details of your actual income and work out your benefit again. If we haven't paid you enough benefit we will pay you more, if we've paid you too much we will ask for it back.

If you have been trading for over 12 months we will ask for a full years trading figures. If you do not have audited accounts we will ask you to complete the Self Employed Questionnaire which is available to download below.

How we work out your income and expenses

Firstly we work out the total business income for the period in question. This will include all money coming in, business start-up allowances etc, but will not include sums of capital paid into the business.

We then consider the expenses you have incurred. We cannot deduct any sums for depreciation, business entertaining or capital repayments on loans.

If you are part of a partnership, only your share of the business takings will be counted as income.

Self Employed Childminders

Childminders are treated differently. Instead of working out what your actual expenses are, two thirds of your total income is deducted and the remaining one third counts as income.

Tax & National Insurance

We will calculate income tax and national insurance deductions ourselves based on the net profit of your business. These figures may differ from the amounts worked out by the H M Revenues & Customs. We also allow half of any private pension contributions you pay.

All the above are deducted from your net profit figure to give us the earnings amount to be used to calculate how much housing and council tax benefit you are entitled to.

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