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Self employment and benefits - What if I have less work than usual?

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.

What if I have less work than usual?

If there is a downturn in your business and you have less work than usual or no work, you might be able to claim benefits for the first time or the amount of your benefits might increase.

If you are claiming Universal Credit and are affected by the minimum income floor, you might find that your benefits don't increase even though you have less money coming in. 

If you are still working full time but your income has dropped and you are already getting Working Tax Credit or Child Tax Credit, the amount you get might increase. For Working Tax Credit purposes, working 'full time' could mean 16, 24 or 30 hours depending on your circumstances. For further details, see Can I get Working Tax Credit if I am self employed?

The amount of Working Tax Credit you get is worked out using your income for the last tax year. If the downturn in your business means that your income this tax year is likely to be more than £2,500 less than it was the year before, the amount of Working Tax Credit you are paid could increase. You should give the Tax Credit Office an estimate of your earnings this tax year and they will work out if your Working Tax Credit payments can be increased.

If your usual hours have dropped below working full time (16, 24 or 30 hours per week, depending on your circumstances), you should speak to an adviser to check whether you will still be entitled to Working Tax Credit.

If you are no longer entitled to Working Tax Credit, you should use our Benefits Calculator to check whether you might be better off claiming Universal Credit.

Reviewed: April 2022

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