Self-Employed Claimants
Self-Employed - A Definition
Self-employed people are those workers who are not employed
under a contract. Typically, they can include trades such as
window-cleaners, certain taxi-drivers, painters and decorators,
etc.
A person can be self-employed as a sole trader or as part of a
business partnership.
Information Requirements For Self-Employed
Customers
If you have recently started trading on a self-employed basis, we
will ask for an estimate of the likely income and expenses for the
business over the first few months trading. This will help us to
pay your Benefit sooner rather than having to wait until you have
been trading for a few months.
If you have been trading for over 12 months, we will ask for a
full years trading figures - normally in the way of a 'profit &
loss account'. We may also ask for the most recent tax assessment
form received from the Inland Revenue.
What is my Total Income for Benefit
Purposes?
The starting point in the calculation is to 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. Download a Self-Employed Earnings Certificate
here.
Which Expenses are then taken off this
Income?
The Benefit rules are similar to the rules operated for tax
purposes. Notable differences are that we cannot deduct any sums
attributed to expenses such as depreciation, business entertaining,
capital repayments on loans or any sum which relates purely or
partially to a private expense.
Self-Employed Childminders
Childminders are treated differently. Instead of working out
what their actual expenses are, two thirds of their total income is
disregarded. The remaining third becomes their 'business income'
for Benefit purposes.
Business Partnerships
If you are employed in a partnership, the pre-tax profit for the
business (i.e. gross income, expenses) is divided equally between
the number of partners. If there is a formal agreement in the
partnership which governs that profit should be treated
differently, then this will take priority.
Tax & National Insurance
We will calculate income tax and National Insurance deductions
ourselves based on the net profit figure. These figures may differ
from the figures worked out by the Inland Revenue. Half of any
private pension contributions are also disregarded.
All of the above are then deducted from your net profit figure to
give us the earnings amount to be used when calculating Housing
& Council Tax Benefit
Further Information
If you have any questions or would like any more information,
please contact the Helpline on (01304) 872199 or write to:
Benefits Section
Dover District Council
White Cliffs Business Park
Dover
Kent
CT16 3PJ
E-mail: revenues@dover.gov.uk
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