Findhorn: I want one

I went to Findhorn!  After all thirty odd years of telling the story of Peter Caddy’s greenhouse, I have finally visited Findhorn in the flesh.  It’s wonderful, and I want one.

    The original garden that grew the enormous vegetables, and the old caravan where Eileen and Peter Caddy and Dorothy McLean lived after the voices told Eileen to tow the caravan there, are just where they were.  I imagined the plants ‘grown in sand’ to have been planted in random beds in the sand dunes next to the sea.  But of course it wasn’t like that.  They made a normal garden outside their home.  Now it is at the heart of the established Findhorn Foundation’s site, surrounded by other Findhorn community projects, like the eco-village, the Universal Hall, mature and well-tended gardens and several eco-housing developments.  It is 51 years ago the Caddys moved on – and the atmosphere must be very different from the bleak caravan park next to a military airfield.  I can’t help wondering what might have happened if the same had been allowed to happen at Molesworth.

I’m not a great spiritual, god-type person, but I do believe in things like ‘ being in the right place at the right time’, ‘luck’ (which relies on having created good karma), ‘doing the right thing’, i.e. following your own path ( a PC version of Aleister Crowley’s Do what thou wilt shall be the whole of the Law’) rather than being a supercilious goody-doody, the waters parting and everything being easy when you are doing the right thing, and people and resources turning up when you need them.  The Findhorn founders were guided very specifically by the voices that Eileen heard, telling them on a very practical level what they should do, build, buy, etc.  Largely things manifested as they needed them, but Peter Caddy couldn’t understand why he hadn’t got a greenhouse.  They needed a greenhouse, and normally everything arrived fairly swiftly.  So he was racking his brains wondering why no greenhouse had manifested.  Then he realised he hadn’t been specific enough.  Once he decided the materials, size, dimensions etc, it appeared within a week.  (Told in The Magic of Findhorn by Paul Hawken, Fontana 1976).
I’d really love to hear voices. I did hear one once.  I won’t go into that now, but interestingly (or boringly) the voice only told me the most obvious thing that I really should have been able to work out for myself.  But the idea of hearing voices telling me where to park the van (say) or which veg to plant where, would be so handy.  So I’m listening out…

Caithness Croft Furniture

I was quite taken with some of the furniture traditional to the Caithness croft houses.


Firstly the Caithness chair.  These were often made of driftwood as there are few trees in Caithness.  Their distinguishing feature is the rail at the front that can be used for hanging things to dry.  This is a particularly rustic specimen – I prefer that sort of thing, makes it more do-able – but they can look like normal furniture as well.  They probably still make them.I thoroughly recommend Wick Heritage Museum if you ever have the chance to go there.  Its got room after room of stuff relating to what I think what is called ‘social history’.  Basically all the stuff they used in the old days, tools, household stuff and whatnot.  Some of the rooms were done out like complete rooms, bedrooms, etc – also rooms devoted to military stuff, glassware and pottery, and loads about boating and herring fisheriies, as that was what Wick was important for.  A good source of information about things like barrels and bushels as legal weights and measures,  Everything was accessible, a lot of it handleable and it only cost £4 to get in.


I was intrigued as to why the kitchen ranges are so small.  This one is in Laidhay Croft Museum – and old croft house converted to a museum.  The popular theory, if you ask, is that ‘people were smaller then’.  That might account for it sometimes, and someone at Castle Fraser rteckoned it is because it was easier to reach  the heavy cast iron pots and pans and shift them about.  That might have been the cae with the huge castle range – which, incidentally, was nowhere near as low as the one at Laidhay Croft.  You can’t tell from the photo, but it didn’t even come to the top of my thigh – and it was definitely authentic, because it was the actual one in the house that was lived un up until the 1960s or something.
Well, my theory is that you sit down to cook.  As someone who likes sitting down, and sort of accepts that cooking is part and parcel of life, I’m all for sitting down to cook.  Not only that, if your fuel is slow-burning peat, you eat a lot of meat and porridge, and you have to heat all your washing water on the range, it’s going to take a long time.  Add to that the location – wind-swept,  coastal North East of Scotland, the lack oif insulation other than heather turfs on your roof, you’re going to be cold.  So sitting down in fron to the fire on your Caithness chaiir, while your smalls dry on the rail at the front, seems the best way to go about a lot of your daily activities.

Then at night you go to sleep in a box-bed.  These are absolutely wonderful inventions.  They look like a giant wardrobe – about the same height, but broad and long enough to make a bed inside.  There is nothing except the bed in there – maybe just a small shelf for your candle and matches, jewellery or whatever – and it has got az proper little roof so you’re really cosy.  The front is open, or at least it’s got an open opening – but some of them had doors that you could open right up, or fold closed in the winter for extra draughtproofing.  A few hooks on the end and you’ve got somewhere to hang your clothes.  The image below is a reconstruction in the Highland Folk Museum – the real ones are on my phone – I’ll try and upload them when I get home.
The other good thing about the box beds is that you can use several together, configured to turn one communal living space into cosy, separate, private rooms, with little corridors in between.   Ideal for families with under 10s and subject to the Bedroom Tax.  That’s what I say.

Mini hydraulic ram pumps

 I went to Bowden House yesterday, our old car boot sale venue, which used to be a photographic museum that ran a car boot as a sideline, and is now a community that doesn’t. They were just having a Courtyard Sale: community members put out a few tables, selling their own stuff.

One of them had little hydraulic ram pumps for sale: he’d made demo models, based on the real one at CAT, intending them for demonstrating the technology to schools or people in developing countries. He had one set up and working, made from copper piping, plumbing fittings, plastic pipe, a plastic lemonade bottle and various other bits and pieces. In some ways it was more impressive than the real thing, because it was made from familiar items and you could see the whole thing working at one go.

The water started in a plastic bin on the floor, flowed along a piece of copper pipe and through a collection of fittings, which forced it up the plastic pipe so that a little squirt of water pumped out about eight foot high. He was adamant that it was only for demonstration purposes but I could imagine real uses for it. It is better suited to a continual, natural water supply, but pouring water into a tank on the floor, perhaps below the outside tap, is a lot easier than lifting it up high. It would water hanging baskets, especially if they were placed one above another, or maybe water the plants on the shed roof. Priming it after it has stopped would be a factor, but provided it is within reach that wouldn’t be a problem. The pump produces some waste water, so ideally it would be placed somewhere spilt water would be an asset. And there are loads of plans on the internet for making real life-size ones.

Foraging in the Highlands

 I’ve been trying to upload the photos of the mushrooms I foraged for dinner at Castle Sinclair Girnigoe in Caithness.  They were such whoppers I only picked one to eat and onesmall one to dry for later (on top of the inverter).  I ended up cooking the whole of the big one, in butter and garlic, and ate about half mixed in with my lentils and whatnot.   I’m used to cooking for four, and my dinner was double the size I needed it.

I’m not a mushroom expert, but I fully expect to recognise something edible when I find it.  This smelt and felt and tasted like a field mushroom.  It didn’t look that much like one, but that’s because it was about eight times the size.  I remember my dad picing one twelve inces across at Virginia Water when I was a kid, so I know they come like that.  This had a white cap, brown gills and was just field mushroom  in every cell of its being.

Then I looked in the mirror, and my face was bright red! “Ahhh, I’ve poisoned myself!” I thought.   In fact I said it, to the mirror.  And to the dog.  I peered down my top and up my jumper, trying to work out if I had a rash.  No.  I sniffed the mushroom.  I tasted the mushroom  Definitely OK.

Then I realised – after all that – it must be sunburn.  It is another of life’s strange little phenomena that however tanned I get (I’ve been reading Diana Gabaldon’s Outlander series and sunbathing in the garden all summer, for heaven’s sake) I get sunburnt if I go somewhere different.  Like Minnions in Cornwall, and Wick in Caithness.  It’s as if the sun is of a different quality – or coming at me from a different angle?  Answers in a tweet please.

Anyway, Samsung Keis is only 64% downloaded so you won’t be seeing photos of the huge non-poisonous mushroom tonight.  Maybe when I next get to WiFi land…

In the meantime, a list of foraged goods:

  • Psilocybin mushrooms (John O’Groats, numerous stone circles, Beinn Ghlas)
  • Coltsfoot (John O’Groats but masses everywhere)
  • Giant chamomile (John O’Groats – don’t know it’s proper name)
  • Field mushrooms (Castle Sinclair)
  • Sorrel  (John O’Groats , Castle Sinclair, Beinn Ghlas)
  • Guelder Rose (Noss Lighthouse carpark)
  • Clipper lighter (Wick – functioning, hi-viz orange, with gas)
  • Balls – for the dog (Wick, Inverness, Birks o’ Aberfeldy)
  • Chanterelles (Loch Ashie)
  • Blaeberries (Ladder Hills, Druim an Aird carpark, Beinn Ghlas)

Garlic: rust, harvest, plaiting

I just harvested my garlic.  The garden (as well as my blog) has been neglected somewhat, as it always is in June while I go off to Glastonbury to exercise a couple of my alter egos. I came back to rusty garlic. I don’t think it really matters, and anyway there’s nothing you can do about it.  Once the rust has appeared the bulbs never grow any bigger so I just harvested it – which I think I should have already done anyway. Apparently the rust can spread to any allium so they say to burn the leaves, but I’m not a great one for bonfires so I’ll probably just put it in the slug-farm bin (don’t ask). On Gardners’ World last week Monty Don was talking about his garlic rust, saying how it had affected some varieties of garlic but not others – even though they were right next to each other. So I’m not going to worry about it unduly. I’ve got about 10 varieties of allium and none of the others are showing any rusty tendencies. In some ways I think the rust was a good thing. I’d probably have never got round to harvesting it otherwise.
Rust notwithstanding, I’m rather pleased with the crop. I planted the large French bulbs I bought from The Olive Branch at Totnes Market – not strictly elephant garlic, but they were still pretty huge. I’m sure it is the way to go. I just can’t see the point in piddling about with miniature garlic.  What I can never understand with recipes is why they tell you to use ‘a’ clove of garlic. Why in heaven’s name would you use one clove? It’s all I can do to limit myself to one bulb. So I bought five bulbs, each with ten cloves, for £1 each (I see they are 65p on their website) – which is still a lot cheaper than seed garlic. From the fifty, I seem to have got forty one, many of which are a really good size. Some are probably the same size as the bought bulbs, and even those that aren’t are nice and plump. Considering they are grown in Devon rather than Provence, I would expect a slightly poorer result. It is certainly the most successful garlic I have ever grown – which I put down largely to the correct timing (I planted nice and early), growing in a raised bed (gives room for the roots to develop) and using the big bulbs.


Having a real crop of garlic has meant preserving it properly – and that involves plaiting – or ‘braiding’ as the Americans call it. You can then hang the plaits somewhere airy and use it as and when you need it. There are YouTube videos: I used this one from Gardenerd. You need a pair of scissors, a longish one of those little wire ties to start the plait off with the first three bulbs, and grippy string to finish it at the end. You have to cut off all the roots, and I also stripped off the crustiest of the rusty leaves. Then you settle down outside in the sun with the plait on your lap, adding one bulb at a time and plaiting it in. Best to watch the video.

Three garlic plaits


Some of the plants had started to produce little bulbs that form inside the stalk – you can see and feel the bulbous lump.  I slit the stalk with my thumbnail and took them out – partly as an extra yield, but also because they would have got in the way of the plaiting. On the plant they would have matured eventually into bulbils that could be planted to reproduce more garlic, but as mine looked immature and green I decided to keep them to use for cooking. They have the same strong garlicky taste as the actual cloves of garlic.


The other thing I kept was the best of the bulbs to use as seed for next year. It’s hard not to eat the lushest and best, especially when they are the least fiddly to cook with. But it is generally accepted that you do better year on year if you keep the best of the crop to use as seed. If I had a bit more space I might keep all of it – like some guy I heard on The Food Programme a few months ago whose wife bought him a few bulbs for his birthday and he refused to eat any and he’s now growing acres of the stuff. Eventually he had enough to start selling it. I never will. I love the stuff.



Reclaimed bottles are a free and versatile material for edging paths and beds. Here are some useful tips for creating bottle-beds in your own garden.


A few months ago, reading a garden design book, I stumbled upon the terms ‘masses and voids’.   I’d already identified that my garden looks a mess because there are so many ‘non’ areas butting up against the designed and intentional elements. I realised that the solution is to design the voids. The masses will take care of themselves, since they are trees or bushes or rustic duck houses or whatever, and tend to be the nice bits. My focus for improvement needs to be the gaps in between – mostly the paths.


There was also the issue of drainage. We’d had a lot of rain. I’d installed two innovative but amateur rainwater harvesting systems, both of which are unfinished in that the ingress of the rain is complete and functioning but the egress is still largely at the concept stage. The upshot of which is a lot of water on the ground. I’d dug what I rather romantically call a ‘swale’ at the top of the garden, running across what I like to think of as a ‘contour’. Actually the garden is too small and too level for contours, but the idea is to trap the run-off from up above the site. It does so, but there is nothing like actually doing something and seeing the results to identify its faults. Because the main run-off from up by the garages comes down the path and enters the swale at the entrance to the garden, which continues as the main path down through the garden. So what was actually happening was the bulk of the water was being retained by the soil under the path instead of under the growing beds, and once trodden on this makes the path pretty slushy. So  the creation of the paths and the installation of a drainage system needed to be incorporated into one design.


Where the paths run widthways, they can be treated as a shallow soakaways, with a loose layer of drainage allowing water to filter through quickly – in this case into the soil below.  We dug out a few inches of topsoil to use on the beds, then infilled with shredded prunings from the apples, buddleia, forsythia and unusable willow. There wasn’t enough material, so when urban hacktivist Florien Riviere arrived to spend the week WWOOFing, he was delighted to make multiple trips to a council verge where they had dumped their shreddings from – what smelt like – Christmas trees.

The main path down through the garden poses a particular drainage problem. It runs lengthways rather than across the contour, it drains the garage run-off as mentioned above, and it also gets particularly compacted. So while we used basically the same method – topsoil removal and infill with wood-chip shreddings – I also created a slight camber to encourage the water to drain towards the beds and borders. Here you can see the difference between the path where we were stomping about making the beds, and where the wood-chip path has been created.

The worst that happens now is that it feels a bit soft underfoot after heavy rain. The mulch will need topping up occasionally and, when rotted down, may eventually need digging out,  adding as a surface mulch to the beds and replacing with fresh chippings. This is harder work than paving or concrete, but even without the environmental considerations of concrete, it’s not safe to use with the ducks. Wet duck poo is incredibly slippery.  Like this, there is also ample scope for changing the course of the paths as plants grow and access is required in a different place.


This is also the beauty of using old bottles for edging the beds. The bottles are free, reasonably decorative (my preference is for using a uniform colour), can be arranged in any pattern, easy to install – either incrementally or in a big batch, fairly easy to move again, don’t take up much space and do not rot. A rubber or wooden hammer is the only tool you’ll need, and possibly a piece of board or plank the same width as the bed.

Marking out

Obviously you’ll have some idea of where you want the path to go, and it isn’t necessary to mark it out entirely – although winding a hosepipe or two in the proposed pattern would give you the chance to try out the path for size and route. Smooth curves are good or you’ll be tempted to cut corners – and sometimes it just feels ‘wrong’ for no apparent reason. I found it impossible to visualise the path until the bottles were actually in place – so I used marker bottles a few yards ahead, and kept viewing it as if I were approaching from different directions and angles.


There are two main decisions you’ll need to make early on. Firstly the type of bottle. You need ready access to an adequate supply (using blue gin bottles would be very pretty, but rather slow and horribly bad for the liver), and they also need to be the right shape. Wine bottles might work, but the neck needs to be quite long in proportion to the body of the bottle, so that they stay firmly in place without toppling over. The temptation might be to use taller bottles and build the beds up considerably deeper than the paths, but I don’t really think bottles are up to being retaining walls.Squat little stumpy bottles won’t work as the necks are not long enough. 1 pint beer bottles would be great, if you have a supply. My supply was 240ml Stella and 270ml Grolsh, which I use interchangeably without noticing the difference.


The width of the path is one of the most important decisions. You can make narrow little paths, but they look mean and can feel weird to use – although this might depend on the size of your garden (and yourself). If you carry big stuff through or use a wheelbarrow, you’ll need large enough paths to accommodate this – and remember that shrubs and bushes will overhang as they grow. I also have a concrete path outside the garden which is used by tradesmen and callers and I can use as an alternative. I also don’t use a wheelbarrow. So I made mine an easy hip-width with my arms dangling at my sides, and that looked in scale with the garden. In places it has worked itself narrower, and which I’ll probably widen eventually. Once you’ve decided the width, you need to add to this the diameter of the bottles – which will make it look too wide once you start digging. Just accept this. It’ll work out better than starting with a path that looks right then filling it with bottles.


You don’t want to dig any deeper than the topsoil, but if your soil is in good nick, even that might be rather a lot. Weigh it up between how much time you’ve got, how much mulching material for the paths and how deep you need the soil to be on the beds. I made the beds slightly deeper than the paths mainly because I didn’t have sufficient mulching material. The bottles seem to be holding in place so far, but if they begin to work loose over time it would be possible to fill in the paths a bit deeper. Theoretically the bottles only need to protrude enough to keep soil and path materials separate. I needed a bit more definition because the ducks peck around at it.


Universal Credit and the Self Employed

This post was originally published on my old website in March 2013 and has been updated incrementally since. The Advice for Decision Makers on the DWP’s website, published after Universal Credit was introduced on 30th April has clarified various matters regarding the implementation of the scheme. Whilst the information below is essentially accurate, there is now much more detail, which I is included in my Universal Credit and the Self-Employed briefing paper. Please click below to download a free copy.


Download File

Universal Credit is the new benefit system that is due to be introduced in October. Described by the DWP as: “… a new single payment for people who are looking for work or on a low income” it is going to affect pretty much everyone of working age who receives state help of any description – including Tax Credits. I am not a conspiracy theorist, and I’d always urge against scaremongering – because I believe in creating a positive reality where ‘all is well’, and because I believe it is disempowering to set oneself up as a victim. But this is a nasty piece of legislation, which is going to affect the most resourceful, hardworking people in the most sustainable businesses with the most frugal lifestyles. It is possible that Universal Credit will have some winners, but I am very concerned about the ludicrous rules for the self-employed.  It isn’t absolutely clear what is going to happen and how and, unhelpfully, all HMRC say is: you don’t need to do anything until the Tax Credit Office tells you to. The Tax Credit Office will tell you when you can make a claim for Universal Credit, and stop claiming tax credits.” HMRCActually I think we do have to do something. We have to have a look at the proposals, work out how they will affect us, ask a lot of questions about how they are going to be implemented in practice and make an unprecedented fuss about it to anyone who’ll listen.
I have read through the Universal Credit Regulations 2013 which contain the detail of how the Welfare Reform Act 2012 will be implemented. The following is an overview of the main provisions for the self-employed, and my opinion as to how we are likely to be affected. [At present it is still a work in progress – please keep checking back until this sentence disappears.]

How is it going to work?

  1. New claims. When you make a new claim and declare that you are self-employed, you will be invited to a ‘work-focused interview’ to ascertain whether you are in ‘gainful self employment’ or meet start-up conditions.  Your business activity will be assessed in view of deciding whether you are in fact self-employed, and if so whether self-employment is the best way for you to earn your living or whether you would be better off getting a job.  It is unclear whether this will be a mere formality if you are earning the equivalent of the minimum wage, or whether you will still be encouraged to try to earn more so that you can be self-supporting without benefits. UCR 2013 Reg.93(f) (Purposes of a work-focused interview). Evidence of self-employment “may include diaries of appointments, lists of customers and suppliers, proof of tax registration with HMRC, marketing materials…, a business plan, receipts for stock purchased, order and sales records and bank statements” – see DWP 2012 para.163. DWP H4013 has a list of factors the Decision Maker (DM) should have regard to in order to recognise a ‘trade’.
  2. Starting a new business. New businesses will have to be assessed as viable by advisers (who may or may not know anything about your particular industry). Presumably you will need to be able to predict and convince the adviser that, after a year, you are likely to be making enough to take drawings of (up to) 35 hrs x minimum wage.  This is likely to put off many people from starting a business at all and penalises small, slow-growth businesses in favour of fast, money-making schemes (albeit that they might be a flash-in-the-pan that ends up insolvent in a short while). It is inevitable that potential businesses will be assessed by bottom line only rather than any other social or ecological benefit that may be derived from the business. It is unclear whether you will be ‘allowed’ to start a business if it is not considered viable. Presumably you will (I have seen no express intention to curtail freedom to start a business) but will have to do so in your ‘spare’ time (i.e. after 35 hours work and looking after your 5-18 year-olds…).
  3. Gainful self-employment. The main issue affecting your work status is whether you are assessed to be in gainful self-employment – i.e. running your business as your ‘main employment’, with ‘self-employed earnings’ and a “organised, developed, regular and carried on in expectation of profit.”  see Reg.64 (Gainful self-employment). The ‘main employment’ test will be applied both to those on low hours or low pay, and those who are also doing employed work. A good indicator is if self-employment takes up “the majority (i.e. at least half) of the claimant’s work week – this would be 18 hours a week for claimants with no limits on their working time.” – see DWP 2012 para.163.  Number of hours spent  is considered both in relation to ‘expected hours’ (see below) and to any employed activity. The ‘claimant’s intention’ and amount of earnings are also considered – see H4023-4034. Fewer hours are possible if a higher proportion of earnings are from self-employment; conversely, marginally more hours but limited income may fail the test.     Self-employed earnings – as opposed to employed earnings – are clarified by the factors in DWP H4016, and are similar to the criteria used in employment law.  ‘Organised, developed, regular and carried on in expectation of profit’ is clarified in H4050. In addition to the above, matters such as steps to increase income, how HMRC regard the activity, work in the pipeline, and marketing and advertising will be considered.
  4. Business structure. If you have a limited company but your position is analogous to that of a sole trader (or partnership) you will be treated as if you are a ‘sole owner’. This doesn’t appear to be defined and presumably applies if you are the only director/s and shareholder/s, but it does not rule it applying to other models. It then applies in relation to the company’s possession of capital, to company income and to the minimum income floor rules, even if you are technically employed. Any such self-employed income will be in addition to earnings from being a director or employee. See Reg.77 (Company analogous to partnership or one person business). The affect of this needs careful thought.
  5. Capital. Personal capital will be taken into consideration for both entitlement and awards. If your capital is above £16,000 you will fail the financial conditions and lose entitlement altogether. Between £6,000 and £16,000 you will be deemed to make income from your capital (£4.35 for each £250). Business assets are exempt, as is your home (and other related capital) – see Regs.46-50 (Capital) Sch.10 (Capital to be disregarded) and  Reg.72 (Assumed yield from capital).
  6. Students. You will not be entitled to Universal Credit if you are a full time student in advanced education, unless you are responsible for a child or ‘qualifying young person’ (usually 16-18 year old in full time education) – see Reg.12(2) (Receiving education) and Reg.14. (Exceptions). If you are one of the exceptions, any student income will be treated as unearned income, and this includes any student loan, or student loan that could have been applied for – Regs.68-71 (Student income). You will also have to report your self-employed income. On the plus side, students are not subject to work-related requirements – see Reg.89(1)(e)(ii) (No work-related requirements).
  7. Temporary absence from Great Britain. Currently, on tax credits, you can leave Britain for a year, the first 8 weeks of which you will still receive payment.  Under Universal Credit, if you leave for more than one month you will no longer satisfy the ‘habitual residence’ rule and will lose entitlement altogether, for yourself and your children, even if you, your family and your business still have all the same obligations and expenses whilst you are away. This curtails ability to make extended trips overseas for acquiring new business, sales, stock purchasing, research, journalism, gaining work experience – and assumes people only go away on holiday – see Reg.11(1)(b)(i) (Temporary absence).
  8. Self-employed earnings. Once entitlement is established, payment will be based on your earnings in an assessment period of one calendar month. You report your income for that month (including any payments received for past, present and future work – DWP H4004) less any expenses you have paid out that month. The remainder will be treated as your ‘income’. You cannot carry forward any business revenue, even if you have regular, foreseeable expenditure coming up in the future. Seasonal fluctuations in income are not taken into account for the purpose of calculating self-employed earnings. If your expenses that month are greater than your income, the loss cannot be carried forward to a future month.  So although the Regulations refer to ‘gross profit’, this effectively means that self employed income is assessed on the basis of business revenue rather than profit. This ludicrous notion is completely devoid of logic or fairness. How can a business be expected to treat all income as being available to live on, just because it isn’t spent that month?  This is incompatible with annual accounting, and militates against ensuring that your business holds even small reserves to see you through market fluctuations let alone any notion of re-investment. See Reg.21 (Assessment periods) and Reg.57 (Self employed earnings). Note you may have self-employed earnings even if you are not ‘gainfully self-employed’- DWP H4011.
  9. Monthly reporting. The Claims and Payments Regulations state that of monthly reporting will require you to supply such ‘information or evidence’ as the Secretary of State ‘considers appropriate’  “in such manner’ as [s/he]determines” – see Reg.37(2)&(3) (Evidence and information in connection with a claim). The DWP state “you will have to supply monthly cash-in and cash-out figures [the] system will be closely aligned to … (HMRC) proposed new cash basis accounting system for tax self-assessment.” – see p.3 DWP quick guide (Moving to Universal Credit). It is not clear exactly how detailed this will need to be or if it must be in a particular form but this administrative requirement will be in addition to the annual Tax Return, periodical Council Tax Benefit review and quarterly VAT return. A number of taxation and accounting organisations have expressed concern over monthly reporting and online reporting. An extract from the online self employed earnings form is available in the  DWP Research report p.78.
  10. Permitted expenses.  Expenses incurred that month in the course of the business may be deducted provided they are not ‘incurred unreasonably’. ‘Reasonable’ is not defined. Repayment of capital or interest on a loan is not a permitted expense, and nor are payments for non-depreciating assets such as property. It is not clear how purchase of depreciating assets is to be treated. Strangely it appears that VAT and income tax may only be deducted from the month you actually pay them to HMRC. In other words you will be expected to treat as income (and live on?) money which is not yours. This makes even less sense when you consider that self assessment income tax is paid in respect of the previous financial year, and actual payment bears no relation whatsoever to the month in which it is paid. See Reg.57 (Self-employed earnings) and Reg.58 (Permitted expenses). It is possible that this provision will only work with the new cash basis accounting, although there is no mention of this and cash basis is voluntary at present – see HMRC Simpler Income Tax.
  11. Vehicle expenses. If you have a car or motorcycle, you will have to deduct a flat rate for mileage. You will no longer have the choice of deducting the actual costs of acquisition and use – although it appears you can still do so if you have a ‘van or other motor vehicle’. This is bad news for anyone who does short journeys and has low mileage yet still has to pay for parking, road tax, insurance. MoT and repair bills – you can only get your money back by driving a long way! This is not good news for carbon reduction. See Reg.59 (Flat rate deductions for mileage).
  12. Home used for business purposes. There will be flat rates for use of your home for business purposes (based on hours use) and for use of business premises as your home (based on number of persons occupying the premises). These may not necessarily reflect the actual costs and will presumably be prejudicial to anyone paying high rent, Council Tax or water rates, or in hard to heat properties, etc Reg.59 (Flat rate deductions for use of home).
  13. Notional income. If you provide services for someone free of charge or at a reduced rate, and they can afford to pay you, you will be deemed to have earned reasonable remuneration for that work. In other words, you need to be careful of doing work experience or internship, offering discounted or free services (perhaps as introductory offers or trial periods), or of working for nothing because you believe in a cause. ‘Charitable or voluntary’ organisations are excluded, but beware community interest companies, limited companies or co-operatives etc whose aims may be laudable but are still run as a business. It is not clear how ‘means sufficient to pay’ is ascertained. A skint festival like the Big Green Gathering may clearly not have the means, but Glastonbury Festival arguably has, albeit that they plan to give the proceeds to charity – see Reg.60 (Notional earned income).
  14. Awards. Everyone starts with a theoretical ‘maximum amount’. Any unearned income is deducted from this, and also 65% of any earned income (including self-employed earnings) in excess of a theoretical ‘work allowance’ (i.e. an amount that is disregarded) – see Reg.22 (Work allowance table) . These amounts depend on whether you are single, whether you have children, whether you have ‘housing costs’ and whether you have ‘limited capability for work’ – see Reg.22(1) (Deduction of income). There are then a number of ‘elements’, depending on your circumstances, for which payment may be made – see Regs.23-31 (The elements). It’s quite complicated to get your head around – the CAB have done some model calculations (somewhere) but it would be good if someone with a mathematical bent would do one for self-employed income. But as general principles: everyone eligible should get something (their work allowance), and those with the most children or highest housing costs etc will have more left after their deductions.
  15. Minimum income floor. BUT…claimants in ‘gainful self-employment’ but not making much money will be deemed to be earning the equivalent of the minimum wage for the ‘expected number of hours’- see Reg.62 (Minimum income floor).  The number of hours depends on circumstances but is normally 35 hours per week. If you have a ‘physical or mental impairment’ it may be fewer, if you have a child under 5 it is 16 hours, and if you have children between 5 and 12 (under 13) it is meant to fit in with school hours – see Reg.88 (Expected hours). The rationale seems to be that if you are doing fewer hours you are not working hard enough or are making tax payers subsidise your hobby, and if you are doing more hours for minimal pay, you are flogging a dead horse. The only people who will be OK are the ones making lots of money (whether or not they are working hard). The recession, or other factors affecting the market in a particular sector, will not be considered good reason not to be earning more. If you are not working full time on your business you will not be considered to be in ‘gainful self-employment’, but although the minimum income floor will not apply you will be be subject to work related requirements. It is possible that this will be preferable for some claimants if your business is one that almost runs itself and you would prefer to jump through hoops than to lose benefit.
  16. Start-up period. New businesses will be allowed a period of one year to reach a required level of income before the ‘minimum income floor’ rules are applied. No further start-up period will be allowed for 5 years, and then it has to be a different trade, profession or vocation. See Reg.63 (Start-up period).
  17. Deductions. If you fall below the minimum income floor, deductions will be made from your benefit as if you had earned that income – less the tax and NICs you would have paid. This is a bitter application of the increase in personal allowance to £9,440, since you will have less notional tax deducted from your deemed income than if the allowance had remained lower. Similarly the minimum wage will now be a bane rather than a boon, if it increases we’ll simply lose more. It is manifestly unfair to treat as the same people who in fact have an income in excess of £11,000, and people who have not – because they haven’t got it. You can’t live on deemed income. At present, with tax credits, failure to meet the work requirements only jeopardises your Working Tax Credit but these deductions will affect every element including the child element, and housing element. This means the poorer you are and the more dependent on benefits, the more you will lose and the more it could affect you.
  18. No work-related requirement Workers – including the self-employed – who meet their individual earning threshold, or are deemed to by the minimum income floor, are not subject to work-related requirements. Deemed earnings are worked out as an average which is normally weekly but, if income fluctuates, may be over an ‘identifiable cycle’ or three months if not identifiable – see Reg.90 (Earning thresholds). In other words, seasonal or other variations may be evened out – the affect of which needs careful thought as this may work for or against you. Some other categories, including pensioners and students and some other limited groups also have no work-related requirements- see Reg.89 (No work-related requirements). It appears that the self-employed will effectively be divided into three camps:
    (a) those earning below the minimum income floor, who will be deemed to be working 35 [16, ?] hours per week and will lose benefit accordingly but have no work related requirements,
    (b) those with no work-related requirements, either because they are earning enough or because they fit other ‘no work-related requirement’ criteria, and
    (c) those who work too few hours who will not lose any benefit but will be subject to work-related requirements.
  19. Work-related requirements.  The precise requirements vary according to various factors – too complex to go into here, but are basically of two types. If you’ve got a child under 5 the requirement is ‘work focused interview only’  – see Reg.91 (work-focused interview requirement). Otherwise the requirement is ‘all work-related requirements’, i.e. to take “all reasonable action for the purpose of obtaining paid work”  by spending your ‘expected number of hours’ looking for paid (or more paid, or higher paid) work – see Reg.87 (References to paid work). There are some ‘deductions’ including paid work (it does not state whether this includes self-employed work), work preparation (‘workfare’) and voluntary work – although you cannot spend more than half your time doing this – see Reg. 95 (all reasonable action). The actual activities are varied and potentially onerous, including the obligation immediately to attend interviews or take up paid work within 90 minutes journey of your home. Although having a contract of service is a reason not to take up paid work, a contractor’s contract for services is not – see Reg.96 (Able and willing immediately to take up paid work).
  20. Sanctions. If you don’t comply, sanctions are applied in the form of reductions of so many days benefit, up to and including as many as 1095 days (3 years) – see Regs.101-105 (Reduction periods).

So that’s about it. If you would like a copy of this turned into a more formal briefing paper, please let me know. Please note there are a lot of other provisions – these are only the ones that appear to me particularly to affect the self-employed. That is not to say that these are the only rules to affect such individuals. I did not even attempt to consider the benefit cap, joint claimants, housing costs, foster parents or the intricacies of people with disabilities. When Universal Credit is introduced, please get advice from the CAB about your particular circumstances.

Who is it most likely to affect?

In general it is likely to affect anyone who works long hours for low income, or who is working a small number of hours and is unable to increase these or just ‘get a job’ instead (even supposing there was 100% employment).

  • Single parents (i.e. mostly mothers) who can tuck in a bit of self-employment around childcare and home-care responsibilities, maybe sitting at your computer at 1am selling stuff on eBay. Single self-employed people living in their own home on Working Tax Credit currently receiving £36.92 per week may decide to just give up claiming, but people with dependents and/or in rented accommodation can’t afford to.
  • Sole traders – your income is inextricably linked to your business, and you will be expected to live off the money that comes in rather than spend it on the business, even if you can predict in advance that you will need to spend it.
  • Farmers – characteristically work long hours irrespective of income per hour, who cannot ‘choose’ hours when welfare of livestock and husbandry of crops are factors, who cannot simply abandon the farm if an advisor finds them a job.
  • Freelance writers and journalists – who work for long periods of time without getting paid at all, then get it all in one lump.
  • Performers – Actors who have the expenses of attending multiple auditions get paid months later if they get a part; performers and theatre companies who rehearse for months with box office revenue only coming later.
  • eBay and Amazon sellers – whose income is dependent on the market not on the hours they put in, and who have other obligations that mean fitting in their work intermittently here and there, or who have disabilities and benefit from setting their own hours.
  • Contractors – whose work might be seasonal, whose income may come spasmodically in a large lump, who have contractual obligations that must be fulfilled.
  • Tourism industry – hotel proprietors and seasonal workers whose expenditure may occur in the winter and income in the summer.
  • Seasonal industries – growers, horticulturists, bee-keepers, festival workers – where season and weather both play a great part.
  • Importers of Fair Trade and artisan products who go on extended ‘shopping’ trips in winter for sale at markets and festivals in summer.
  • Home educators – Who will no longer be able to afford to work self-employed from home, and will not have time to educate their children whilst working or doing work related activities all week.
  • Economically deprived areas – the lower the wages are in your area, the less realistic it is to earn more per hour and the more you will have to sell or hours you will have to work to reach the minimum income floor.
  • The economy – all the money deducted from the lowest earners (who normally have to spend all their money) will not be spent, will not go into the economy and will in turn reduce the income of other businesses, making even fewer businesses viable, forcing them to earn less or cease trading, and so the vicious spiral continues.
  • The unemployed – with so many people previously satisfied to be on a minimal income now being expected to enter the workforce, pressure will be put on the (lack of) existing vacancies, preventing others – who may not have a self-employment/entrepreneurial bent and therefore need a job – from getting one.
  • The unemployable – people like me, who who piss people off, don’t pick up on social signals, don’t subscribe to cultural mores and don’t value ‘niceness’ as highly as openness and efficiency.

Implementation and Transitional Protection

A sort of pilot starts in Ashton-Under-Lyne on 29th April, but only for a very limited range of applicants. These are the ‘Pathfinder’ group as specified in The Universal Credit (Transitional Provisions) Regulations 2013. The self-employed do not fall into this group, in that they must not “expect to have any self-employed earnings… during the period of one month ” following the date of the claim – see Reg.12(a). So unless someone subsequently becomes self-employed it will not be possible to see how well or badly it works before it is rolled out more widely. Basically the evaluation is intended to test out the operational delivery – by which they presumably mean their IT system. There are some quite complex rules regarding couples claiming where one of them is not in the Pathfinder group, so if you are thinking of coupling up (or de-coupling) you might want to do so soon if you want to continue claiming existing benefits (in the next fortnight if you live in Ashton-Under-Lyne).Timetable (borrowed from the CPAG Universal Credit page)

  • April 2013 – UC early roll-out in pathfinder areas … (new claimants)
  • October 2013 – UC introduced in one district per region across Britain (new claimants)
  • October 2013 – April 2014 – UC rolled out nationally (new claimants, migration of current benefit/tax credit claimants with ‘natural change’ of circumstance)
  • April/June 2014 – end 2017 – Migration of remaining current benefit/ tax credit claimants (‘managed change’)


The DWP have laid out in policy briefing notes the intention to ensure that claimants moving from what they call ‘legacy benefits’ to Universal Credit will not lose out financially. This only applies where claimants “circumstances have otherwise remained the same – see Para.1

Transitional Protection will apply:

  • When claimants are “moved over in a process wholly managed by DWP”, not when they make a claim due to change of circumstances.
  • “Where the total household Universal Credit entitlement would otherwise be lower than their total existing award of benefit and tax credit” Para.2


  • Claimants will receive “…an extra amount to make up the difference between the old and the new.
  • [C]ash protection will continue to be paid until the value of the award under the new system overtakes the levels of the pre-Universal Credit entitlement.” see Para. 3

Minimum Income Floor

Transitional Protection is not available to self-employed claimants against the effects of the Minimum Income Floor. The TP calculation will be carried out first, and if you qualify for an amount you will retain this extra amount once the MIF has been applied.  This should protect payments not related to earnings – for children, housing, etc.- see Para. 4.

However, the DWP states that the self-employed ‘moved onto Universal Credit’ will not be subject to the minimum income floor for the first six months – see p.3 DWP quick guide

Significant circumstances that will end Transitional Protection – see Para. 7

  • a partner leaving/joining the household;
  •  a sustained (3 month) earnings drop beneath the level of work that is expected of them according to their claimant commitment;
  • the Universal Credit award ending; and/or
  • one (or both) members of the household stopping work.

Questions it raises

  • What constitutes a ‘change in circumstances’ for the purposes of having to claim Universal Credit rather than continue on Tax Credits? Will a child leaving full time education prompt the change?
  • Will existing self-employed be asked to attend a work-focused interview even if they are earning more than their individual threshold?
  • How will new businesses be assessed as viable? What is the process? Who will undertake the assessment? What training will they have? Will they be expert in that particular industry or sector, or in business generally? Will claimants be ‘allowed’ to start their business and claim UC as self-employed during any appeal process, or will they be expected to put their business plans on hold and look for a job? Is there a minimum figure for the projected revenue/profit a new business will be expected to generate? If so, what it is? Will it be the same for every business? If not, what are differences based on?
  • What sort of companies will be deemed to be analogous to that of a sole owner?
  • What is the definition of ‘main employment’ for assessing gainful self-employment under Reg.64? Is there a minimum number of hours the ‘gainfully self-employed’ are required to be working?
  • If claimant’s business is not considered viable, yet they start it anyway, in their spare time,  whilst also looking for (or doing) a job, will there be scope to report self-employed income/expenditure? Can the digital reporting system cope with anomalies like this?
  • How will the minimum income floor ‘expected hours’ be determined when, for the purposes of paid work they would have fit in with school hours? How will this be calculated when the hours are notional and there is no actual place of work to be travelled to and from as a reference for calculation? Will parents be deemed to travel a notional 90 minutes each way between school hours?
  • Will minimum income floor rules be applied during any appeal against the application of the minimum income floor?
  • How do we report our income and expenditure? Are we able to make a declaration (as we do now) or do we have to show evidence of expenditure? Will I have get receipts for every 20p I spend at the car boot sale? Will I have to scan in receipts? Will I still have to report my income monthly, even if I know that I am in any case below the minimum income floor?
  • If work declines and we go below a certain level, will we be forced to abandon self-employment in favour of a full-time job, even if this job is only temporary? If so, will this be triggered the week we go below 35 hours, or will there be a period of grace to see if work increases again?
  • Will the Transitional Protection extend to claimants who are currently on Tax Credits but have savings in excess of £16,000?
  • Does disregard of business assets under Sch.10 Para.7 include cash assets?
  • Will cash basis accounting for income tax be obligatory for those on Universal Credit? Are all the  accounting requirements, calculations and other provisions compatible?

Please let me know if you have any additional questions. I will be sending these to the DWP for clarification.


With the absence of concise, explicit information from any formal source, I am trying to assemble a set of useful resources.

  • Institute of Chartered Accountants Written Evidence to the Welfare and Pensions Select Committee,  August 2012
  • National Enterprise Network – Report from Universal Credit Workshop on Self-Employment July 2012 and update from Universal Credit workshop October 2012 

See also…

  • Benefits advice for advisers, training courses, ‘toolkit’, links to caselaw, etc.
  • Lords Hansard 14 Dec 2011 : Column 1391-1394 debate of Welfare Reform Bill 2012
  • Universal Credit “…an independently owned website that has been created to provide information about the new benefit reform system that is due to implemented by the coalition government  in 2013.
  • The Void Narking off the state” – anarchist commentary
I will post any further resources on the Universal Credit and the Self-Employed  Facebook page as they emerge. Please visit, Like and Share the page, and use  it yourself to post any additions or contributions of your own.

What can we do?

The implementation of Universal Credit is in a bit of a shambles, so I think there is scope to add to the doubts and question its workability. Most recently the pilot planned for three areas from April is being scaled back only to Ashton-Under-Lyne. Most of the hoo-hah has been to do with the computer system and whether or not it is ready to function – and also whether claimants are all going to be able to manage doing it digitally.

  • Write to your MP and tell him/her how you think Universal Credit will affect you
  • Tell your union, rights group, small business organisation, charity, etc how it will affect you
  • Ask HMRC and the DWP a lot of questions
  • Tweet about it, using hashtag #universalcredit and any other that will reach interested parties
  • Post about it on Facebook
  • Talk to your friends/customers/clients/associates/local shops
  • Keep an eye on Ashton-Under-Lyne – do you or anyone you know live there?
  • Start to plan your expenditure to match your income pattern. If your income is evenly spread,  arrange to pay bills monthly. If it is uneven, try to arrange your bills and outgoings to match the same pattern.
  • Consider changing your VAT accounting. There are schemes such as Annual Accounting, the Flat Rate Scheme and the Cash Accounting Scheme which spread the payments differently. Get professional advice.
  • Intending to go into Higher Education ? Do so while you have children, or take your course part time if possible.
  • Keep your business assets in the business rather than taking drawings and then treating them as personal savings.
  • If you do low mileage, swap your car or motorbike for a van or ‘other vehicle’.
  • If you work for someone for nothing or at a reduced rate, enquire as to their legal structure and, if not a charity, ask them for a declaration that they do not have the means to pay you.
  • Consider changing your circumstances now, before Universal Credit is introduced.
  • If you are not claiming Tax Credits but think you might be entitled, or if you are planning to start a business, consider doing so sooner rather than later.

A focused campaign?

The legislation has received Royal Assent and it has therefore gone too far to stop it altogether. The Regulations come into force on the 29th April 2013. However, there is still scope to affect both when  and how it is implemented. If the government think that it is going to cause a lot of trouble – including possible legal challenges – they may just never introduce it. Some of the provisions are so manifestly unreasonable that we should focus on these and try to persuade the Secretary of State to alter the detail in the Regulations – as empowered to do by the enabling Act.These are the rules that are the most unreasonable and will almost certainly have the worst affect:

  1. Basis of assessment – that self-employed income should be assessed on the basis of drawings from business profit not on the basis of business revenue, in particular that provision should be made for carrying forward of profits for expenditure not falling within the assessment period, and to meet liability for Income Tax and VAT incurred but not paid in an assessment period.
  2. Monthly assessment – that this is illogical and unworkable – and should either be scrapped in favour of an annual assessment period, or at least calculated from an average of the previous 12 months.
  3. Minimum income floor – is prejudicial to sustainable, slow-growth businesses particularly those in economically deprived areas and fails to recognise the inherent good of micro-businesses for workers, their families and their communities, and should either be scrapped in favour of actual earnings, or at least the start-up period should be extended to 5 years.

Recent news

10th April 2013 Local Government Chronicle  ‘Digital by default’ replaced by ‘digital as appropriate’?

On a personal note…

I have made good use of my decade as a single mother on Tax Credits. I have saved public money by receiving a lower rate of benefit than I would have on Income Support, by not receiving full Council Tax benefit, not getting free school meals and not receiving mortgage interest payments. Far from having my ‘hobby’ ‘subsidised’, I have acquired numerous transferable skills and built up my business gradually and sustainably to the point where I will be self-supporting once the children leave home. If it hadn’t been for the recession, I would be paying income tax by now, and my business will eventually be my ‘pension’. Self-employment on Tax Credits has enabled me to work from home while I raise and home-educate my children, care for my 85 year old demented mother (her phrase not mine), grow my own food and ‘make do and mend’. It has also allowed me to transcend the stigma of being on the dole and enabled me to turn my industrious, hard-working nature into remunerative work without the hazards and pitfalls of either working while claiming or getting a job. Now, lumping everyone together, all those people who felt they were working are going to feel they are on welfare. What a retrograde step.


janis malins
31/03/2013 15:32

really good article, this needs to get quickly spread about out there: groups of people that it may effect etc. worth the time and effort. from just the discapacity- atos nonsense, the present prime minister has serious reality issues to deal with, he is rapidly making a terrible mess of things and these things are peoples lives.

13/04/2013 20:34

I only work term time. Don’t work at all over summer usually about 8 weeks. It’s a totally feast or famIne. What a crazy set of rules when there’s no jObs or benefits to fall on. I’ve worked hard over 13 years to develop a business that I’m passionate about.

janis malins
31/03/2013 15:33

ps. well done for the effort of putting it together.

Fiona Kirton
01/04/2013 19:58

Have you written this up as a letter to the Guardian to get the information out on a national platform? I am getting my head around this very bad news. As a self employed Complementary Therapist this will be a nightmare. I will send the info to all the other therapists I know who are all struggling because of the recession.

02/04/2013 23:50

Hi Fiona – Yes, a letter to the Guardian is a good plan. I just need to check the legislation properly to make sure what I write is accurate and complete. I keep discovering more!

16/04/2013 16:07

Thanks so much for this! I was thinking of registering as self employed face painter as a second job, but can see now it will be a waste of time. Ive emailed my MP and Helen Goodman MP and included points from your blog. thank you so much for bringing this to my attention, I do not follow the media at all and rely on these blogs for info. thank you for your hard work.

16/04/2013 16:25

Hi Anna, It might not be a waste of time. Because if you already have a job, you’ll either earn enough not to come under any scrutiny, or you’ll have to do work-related requirements. In which case, they deduct any hours you spend working. Working for yourself might be preferable to going for interviews for jobs you don’t want/will never get. (But of course you’ll still be subject to all the monthly assessment issues.)

01/04/2013 22:01

Click to access ssac-universal-credit-report.pdf

I share many of your concerns but the subject is both complex and vast so your proposal to concentrate on a few key issues makes a lot of sense. The link above is to SSAC recommendations which address some of the self-employment issues you raise. Might campaigning on these be a useful starting point ?

03/04/2013 00:07

Hi Terry – Thanks for this link. I have added it to my resources above. It is interesting that the government are prepared to consider a ‘carry forward function’ for losses. There should also be a carry forward function for profit – so that at minimum we can save money to pay VAT, income tax and annual expenses, and to buffer against seasonal fluctuations. They are talking about the monthly reporting data eventually feeding into the tax system, but the current annual basis is far more adaptable to different types of business and it would be far better to do it the other way round. But at least they seem committed to monitoring the results – hopefully it’ll get ironed out at Ashton-Under-Lyne before the whole thing is rolled out.

02/04/2013 23:00

we have on self employment tax credits for a about ten years and run a smallholding earn a little work long hours and at present get less than 90 pounds tax credits for both of us but it keeps us going and working
tax credits are helping a lot of people on low incomes work for themselves uni credits will make the poor poorer

thks for your post

14/04/2013 13:22

I’m a self employed fisherman and I rely on WTC to keep us going when its impossible to put to sea because of the weather,breakdowns etc.I’m frightened for the future,we live a very frugal life and the WTC have kept us off the dole,we pay council tax,presciptions,dental fees,self employed stamp etc.So I guess its back to square one again and JSA.How can this be right?

09/04/2013 16:40

Thank you for putting this together. It is incredible that the current administration profess a desire to cut red tape but will stifle potential new businesses by creating more.

Martin Davies
10/04/2013 01:18

Many thanks for the information, already had some but good to see more even if it does annoy me. Working tax credit isn’t great but this idea seems to be worse and hit harder. Will pass the blog address around.
Good idea about the media, not a fan of the Guardian but if can supply them with the facts then may not go too far off track. Please don’t let Polly Toynbee get hold of it though, some things are better off written by other people.
For what little its worth you have my thanks and my support for this blog.

Oak Johnson
10/04/2013 23:23

Thanks for this Cathy.
Seems like alot of poor people are gonna get poorer, and alot of self-employed will even have to sign back on the dole.
On the other hand, one of the best things that I ever did was to get off the dole and go self-employed, and then to stop claiming housing benefit so that i had to be serious about my self-employment – it’s the only way for anarchist-types to be.
It is true that living off benefits is a ‘lifestyle choice’ for many people – they take it for granted, get complacent, it is a de-motivating influence – i know, i was there once.

11/04/2013 14:02

Hello Oak
I think you’re right, but I’m pretty sure the way Universal Credit is going to treat the self-employed is going to make it harder, more of a disincentive. The beauty of Tax Credits has been the transition from ‘lifestyle choice’ to ‘self-employed’, whereas the minimum income floor is going to make it implausible for many, many businesses. Especially for people with kids and/or high housing costs, who need to earn so much more than single people in order to live.

I hope all’s well for you and everyone at Keveral. Must pop in sometime on my way to/from Polperro.

11/04/2013 22:40

True, for someone on benefits and wanting to start a small business, having housing benefit in the start-up period is important – and if there are too many hoops to jump through to get this amount, it would be a disincentive for some people to go self-employed.
I would say that people currently running not-very-viable ‘businesses’ are most worried about losing benefits completely if they refuse to take up an unsuitable job, and/or don’t get any/enough UTC to cover their rent – which in a worst case scenario could lead to many people becoming homeless (or maybe landlords will just have to accept lower rents from tenants!).

11/04/2013 05:41

I’ve been self employed for many years and often have a marginal income. My business is a bit strapped for capital investment and always has been. Nevertheless, with benefits, the incentive to increase the profit above the level at which WTC is cut back, or, in times when I claimed the local housing allowance, to increase profit above the applicable amount, is perverse. Unless you can experience a rapid and large rise in your income, there is every reason not to increase profits enough for benefits to be clawed back, because the amount of those profits that stays in your pocket is very little, if any.

That could still be the case under UC, but the goal posts have changed. Now there will be every incentive to increase profit up to what you would have earned on a full time NMW, but not much incentive to increase it beyond that. Though at least it won’t be as bad as now, because the claw back of the UC will only be 65%.

11/04/2013 14:13

Hi Debbie
The way my business works (selling secondhand books etc online) it doesn’t necessarily matter how hard I work or what I do to try and increase profits. I’m a real bread-head and don’t need any incentive to want to increase my profits, and I was steadily doing so, year on year, until 2008 when it started going downwards again. That’s the recession. People haven’t got the spare money to buy things. I’m sure there’s plenty that could be said both for and against the free market capitalist model, and different philosophies as to how I might respond, but ‘incentive to make more profit’ isn’t what is missing. It is utterly implausible for me to suddenly increase my profit to MIF level (although without the recession I would almost certainly have done so). So is that an argument for me to abandon my business? In favour of what? I don’t think so. Because whatever else I do is just as likely to be affected by external influences over which I have no control.

26/05/2013 20:16

I too have this problem. A downturn during the recession but I am not in a position to just shut up shop, because, among other reasons, I have debts incurred over the recession to keep my business afloat. Debts that could not be covered by closing up shop and just, say, going on JSA. I note though, regulation 58 3, c, stating no deduction is allowed (unlike the present situation, and notwithstanding it would still be allowed for income tax purposes) for any interest incurred on those loans.

While I appreciate it isn’t the intention of the government to help us fund our businesses by taking into account any interest we may be paying on our business loans, it does go to show that running a business whilst depending on benefits is not a reliable way to move forward,e ven if one is in a position, not yet out of a recession,w ehre the choices would be keeping the business going or going bankrupt.

Fiona Kirton
11/04/2013 19:40

Dear All
Those affected by the Universal Credit and self employment are also likely to be affected by the bedroom tax. This was posted on Martins moneytips and may be of use Appeals must be made within a month of notification of withdrawal of benefit.

12/04/2013 13:28

Thank you so much for this comprehensive article. I am somewhat daunted by the whole pros[pect of UC as I am currently unemployed but training with The British Academy of Sound Therapy to become a Sound Healing Practitioner. This means I will be setting myself up in business just as all of these changes come in to force. I admit that I am terrified by the prospects of what UC will do to my burgeoning business as it will be hard enough, in these austere times, for me to get my practice ‘off the ground’ and actually make a living wage. Most businesses take several years to do so. I have lots of stuff I could also sell online but have noticed the peanuts that things are going for and the disproportionate amount of time and energy that goes into online trading. I did loads a few years ago when there was real money to be made but now??!….. Do you have any other suggestion for off-loading ‘stuff’ (from the break up of my marriage and the selling of our house) as it is costing a fortune to store? I simply cannot afford to give it all away but can’t afford the storage, long term, either!

13/04/2013 12:01

Hi Annelise
Did you use eBay or Amazon? I use Amazon – mostly for media but a few other things – and haven’t noticed any decline in prices as such. I think things change over time, sometimes downwards, partly because some sellers use automatic repricing software and partly because selling off a particular book title (for example) is part of its lifecycle, but often prices also go up. It’s a question of culling stock (accurately!).

What you do with it then, heaven knows. I mostly just shunt it and shift it between house/shed/garage/van/container! A lot of it I Freecycle because, as you say, it is expensive to store. As a natural recycler and scavenger it’s hard to dispose of stuff but I’m training myself that giving it away is actually more cost effective (in money and time) than trying to sell it. I gave 5 boxes of stuff to someone who’s having a jumble sale for Christian Aid. It would take a hell of a lot of work to dispose of it all individually, and takes up space in the meantime. And then, what would I do with the money? Quite possibly spend it in a charity shop anyway. So yes, in your position I’d sift out the most valuable things to sell and give the rest of it away to someone who wants it enough to come and collect it.

13/04/2013 12:04

Oh yes, and about the time it takes to get businesses off the ground: I want to find out the statistics for this – how long it takes the average business to (a) break even or (b) make 35hrs x minimum wage profit. I’m sure these figures will exist but haven’t had time to look for them. I did a few business courses and they used to say 3 years to break even, but that was 20 years ago so I need to update. If you happen to come across this data, do let me know.

29/04/2013 13:42

Hi Annelise,

I sell books on Amazon. To work out if your books are sellable, type the ISBN number (10 or 13 digit) into the Amazon search box. Look for other offers, there will be many. If the sales rank is over 100,000, and there’s more than a page offered for a penny, off to the charity shop with it. If its under two quid for an equivalent condition copy, and the sales rank is over a million, charity shop. The sales rank works like the pop charts, higher number is worse. This method you get 90% of the potential sales value while immediately culling your book collection by two thirds.

12/04/2013 23:35

This is a disaster for actors which will make it more and more a profession for those with independent wealth. With acting you can go for audition after audition (costing you a fortune) and get no work for months and then suddenly get something for a short time at Equity minimum (400gbp a week) or even, if very lucky, hit the big time. UC seems like it will put a stop to this age old version of self-employment. Another blow for the arts.

13/04/2013 12:12

How are Equity likely to view this? Do they care about and support up-and-coming actors or only successful working actors? With self-employment I wonder if there actually are any unions or satisfactory representative bodies who’d want to act on our behalf. All those chamber of commerce, business type organisations seem pretty conventional to me – right wing even. I may just be prejudiced. But do you think it’s worth presenting the problems with Universal Credit to Equity? It’s a bit late really, the consultation period having passed, but the S of S still has discretion as to how to implement it.

13/04/2013 00:52

I can’t find mention in the above of transitional payments whereby, if your tax credits were more than your Universal Credit will be and your circumstances remain the same you will receive the same level of support as you did on tax credits until such time as either your UC rises or your circumstances change.

13/04/2013 12:18

Hi Robert, No, I haven’t looked at any of that yet. Neither the actual technicalities of how it comes in – nor the technical side of claiming/reporting/etc. Someone on the Amazon Seller’s board posted me a link the other day to a Telegraph article with Iain Duncan Smith saying nobody will be worse off. There’s a You-Tube video, and he definitely says so. But I’ve a nasty feeling ‘new claims’ might arise rather easily. I don’t know that though. I’ll try and look it up, but really I want to do some gardening!
(17th February 2012)

15/04/2013 00:15

Hi Robert, I have added the information about Transitional Protection. Not good news as far as the minimum income floor is concerned.

Debbie S
13/04/2013 02:27

Hi i run a small business as a designer maker ive been going a little over a year my business is yet to.make any money due in part to having to.make my stock… I work only 16hrs because im disabled… Im worried sick about UC but noone has been ablevto tell me how it is likely to effect me… I also have a part time job which.brings in slightly more than minimum wage if devided by the hrs i work employed and selfemployed… Im just not sure if that will matter or will.i still be penalised for having no income as yet… Dont know if you have any advice… Very confused…Dxxxx

13/04/2013 12:39

Hi Debbie, I think I’m going to try and make a flow chart when I’ve got a bit of time, so we can try and work it out step by step.

I think you’ll first have to work out your ‘expected hours’. Under Reg.88(2)(c) physical or mental impairment can lead to these being reduced Look at Schedules 6-9 in the Regulations and see if you fall within any of it (on any of the pages you’ll find a link to the Table of Contents. Schedules are at the bottom).

Once you know your expected hours, you multiply this by the minimum wage to get your individual threshold. That’s how much you have to earn (overall, job plus business) not to have to do work-related requirement stuff.

I don’t think you’ll fall under the minimum income floor unless self-employment is your ‘main income’.

But really I’m only grappling with it myself and may have got it wrong. Once they actually start to bring it in, go to the CAB – they can help you work it all out. In the meantime I’d put all that ‘worry energy’ into writing to your MP or any professional bodies related to your industry, etc. Tell them what problems it’s going to cause you, try and get it changed. Because it is crap, isn’t it. How daft not to be encouraging designers and craftspeople to develop their businesses.

13/04/2013 10:00

Really good article! As a freelance musician in receipt of working tax credit and child tax credit I’ve been very concerned about this for some time now. Thanks for doing the research and bringing all this information together in one place (not an easy task).

13/04/2013 12:52

I’m still reeling from having looked at my website stats to see I had 1304 visitors yesterday (I normally get just over 100). So… I’d be really interested to know how you got here.

And to the 54 of you who also looked at another page, I’d also like to apologise for the general crapness of the static pages of the site – they really need an overhaul, but there’s just so much to do…

13/04/2013 13:39

I got here through facebook. Someone linked to you but I can’t remember wether it was on the Fight the Bedroom Tax group or one of the many hate the Tories groups! Or it could have been a friend of mine who linked to it. Anyway, don’t worry about your other pages, I looked at a few and found them really interesting, manly because I find people who can garden are magic people and I have a fantasy of having a smallholding despite having no funds or talent or land or property. Your site allowed me to daydream for a moment! Thank you!

13/04/2013 18:41

Facebook friends linked to you – mainly other self employed single parents who are utterly incredulous at what UC actually represent for us. Personally, I’m not getting overly concerned – like yourself I’m not interested in buying in to the negativity – but I want to inform myself and do what I can to change things. I’ll be following this site and have already shared with as many people as I can think of. And I have to say you have done people like me a huge service by filtering through all this stuff, making sense of it and presenting it in a format we can understand 🙂

27/04/2013 01:25

I got to you via:

Thank you so much for putting this together. You have given me more of an insight into UC than any other source I have found online and a lot more than my Accountant could!
I will pass on your URL via our Facebook page. 🙂

24/10/2013 19:47

I have been reading through the comments about self employment and now I am very worried as may have to go part time self employed as will be losing one of my jobs in the near future. I currently work 16 hours a week in total and my self employment would be to top up my hours from my main job. How can anyone who is self employed guarantee to know how much they will earn or what their expences will be in the future when there are so many outside influences which make this impossible to predict. This new system wont allow scope for the peaks and troughs that every business goes through. I have found that I am already worse off for working and frightened that the U C will only matters worse for all of us on low incomes. I am not lazy and have both children and elderly relatives relying on me to look after them and find it a struggle to not only make ends meet but to fulfil my obligations to my family. I wish we did not have to rely on tax credits but unfortunatly we do and that’s a fact. I feel the government tricks people into believing that we will all be better off then moves the goal posts leaving all the vulnerable and low paid people worse off. I tried to improve our situation by finding myself employment but now feel that I have let everyone down. It looks as though being part time self employed will not be the answer when I lose my second job but finding another job to go with my main job will be very difficult as there really isn’t much around, hence my idea to go part time self employed. What a mess the government is making without a care for anyone. Anyone got any idea’s?

24/10/2013 19:48
tim bastable
13/04/2013 13:29

mind boggled – congratulations for going through all this stuff and putting into such comprehensible form – a gargantuan task! Only glad I’m not eligible for any benefits – my income arrives in (not very big ) chunks 2 or three times a year – no idea where it would leave me! The monthly accounting requirements alone are a nightmare – and delivering benefits on the basis of monthly turnover is insane. Is the implication of the rules that on the one hand there is a pound for pound reduction in benefits when earnings are high – effectively a 100 percent tax, but if you fall below the minimum criteria for self employed eligibility in another month you don’t qualify for benefits? I don’t quite get the logic.

It looks like there are rules set up here that are expressly designed to stop less well off people starting a business for themselves – talk about one rule for us and one rule for them! It belies the entrepreneurial friendly cant of HMG.- for poor people at least.

13/04/2013 15:38

A really useful breakdown. You’re helping a lot of people here. Thank you Cathy. Please upload the briefing when you have it. I hope that more sites spring up to help co-ordinate campaigning about this. The implications are massive. I’m self employed in lots of the areas mentioned (seasonal, writing, project based etc) and a volunteer. I needed some help in understanding the implications and this article has provided that. However, now I want to join together with others in action. Links more links. I got here through FB and I’m sharing. You’ll get more hits! maybe a FB discussion group is a good idea to start, so you don’t get overwhelmed by all these comments and the reach widens? And someone tell me how this is a Big Society please?!

13/04/2013 18:10

Hi Cathy,
Well done for putting this together, had no idea that they were going to do anything this ridiculous, it just gets worse. I’ve forwarded it onto loads of people. Have you any idea if this has been forwarded to such as NFU by members, Bectu, Writers Guild and so on to put pressure on to see sense?

13/04/2013 18:14

Thank you for a clearer understanding of the new regulations. I am just completing my first year as a Freelance Artist. work has been hard to come by, soI’m grateful to the system for helping keep the roof over my families heads.Fingers crossed this Government will find some way of improving spending, assist the self employed, so we can all be better off!

13/04/2013 18:40

this is terrifying. i’ve been self employed but earning very little for sometime and i’ve been living with the fear that i’m earning too little. now i’m gonna have to……. get a caravan i guess. i have a daughter, i’m a single parent and i just can’t see the way out of this benefit nightmare. it’s just nearly impossible to find term time school hour employment. I just don’t want to have my child institutionalised in order to work full time. who’s gonna bring her up? This society is sick to the bone

15/04/2013 10:58

I totally understand you, feel the same. I’m a single mum and am presently home schooling my 12 year old who has been teased and bullied so badly that he started having anxiety attacks. Am I to send him back to school? How much money am I saving the government by not sending him to school? I don’t want him having to go to breakfast and after school clubs and never see him. It is almost impossible to find a job that ties in with term times, I’ve tried.

Gaynor De-Festa
16/04/2013 01:16

Nina I have been there, both my children from pre-school age until senior school had to attend either breackfast club or after school club (fortunately linked to their primary school) when I was employed in both part-time and full time positions, (my extended family, parents etc lived too far away and worked, they were able to help out a little during the longer school hols so they werent always going “to school in the hols” after all only 4 weeks paid hols a year as employed didnt stretch very far, and they did spend time during some hols with their father who unfortunatley lives 200 miles away so they did get a little respite) but I felt and always will feel that single working parent guilt, weekends were precious but unfortunaltely all the other everyday mundane tasks like laundry, cleaning etc had to be caught up with then too) I couldnt give them lovely holidays or many expensive days out because I worked to survive and provide that was all, I regret that I missed out on my boys childhoods so much and now they are approaching 15 and 18 it’s makes me even sadder, I regret they couldnt go out to play wth their friends after school and often missed out on parties unless other parent in the same boat were able to help and I would try to help them too by taking each others kids to after school events etc. rarely because by the time we all got home, ate and worked on homework, it was alomost bedtime……I never intended for life to be this way for them or us, but it turned out to be so finally retraining and opting out of being “empployed” 9it took 3 years to achieve, i took our car off the road for 2 of those years, and cancelled luxuries such as internet and encouraged visits to the library etc instead, but it paid off when I was able to finally work self employed and even though I earn less our quality of life is 100% better and I was at least able to be there for them during the teen transitions and important secondary school education transition and have time to focus on them and their goals taking them from school to whatever they choose to do, every stage of their development is important, but without the choice of becoming self employed the teen years would have been just as neglectful, because thats how I feel neglectful, so i am with you and other parents, single or not in just being floored by these reforms, I feel like I have tried and could possibly fail again!!

13/04/2013 19:10

Hi Cathy,

Thank you so much for gathering and collating this information. I am self-employed and as a performer my work is very much seasonal.
Do we know as yet what the minimum income floor is to be set at?
I am sure Equity, as a union should be takin a stand point on this. I will see if I can find out.

14/04/2013 12:26

Hi Nixi, My understanding is that the minimum income floor is based on a person’s expected hours. Depending on your circumstances (disability, kids, etc) you have an expected hours – normally 35, but maybe fewer, depending). This is multiplied by minimum wage (according to age) to give you your ‘individual threshold’. If you earn less than this you will be subject to either the minimum income floor (if you are ‘gainfully self-employed’, or to ‘work-related requirements’. (Unless I’ve missed or misunderstood something.)

Gary Stewart
13/04/2013 20:10

I’m a commercial Beekeeper. The wet summer last year meant I had no income. The wet autumn and cold spring have killed 60% of my bees. I have an interview with the council for housing benefit on Monday and have just put in a claim for working tax credits in order to have some money to live on.I have never needed to claim before. If my reading of your excellent article ( Thank you very much) is correct I may not be able to qualify once the change comes in October. Beekeeping is exactly the sort of business that will be severely affected by these changes.I will have to end my business if I cannot afford to pay my rent whilst I breed more bees to make up for the losses so I can earn an income again. As the Beefarmers Association is trying to recruit new members, persuading Hobby beekeepers to turn it into a business, which will mean more bees, ( which has to good) these changes will be a real obstacle to this.

27/04/2013 01:27

Gary – your story made me very sad. We need you and we need bees.

13/04/2013 20:55

Thank you all for your positive comments. I actually haven’t had one single right-wing nutter leave an anti- comment, which I’m really glad about because it scares the willies out of me! But it might become a bit time consuming to reply individually,,, so yes, Facebook is a good idea and I’ll have a think about whether I could assimmilate it into my life – unless someone else wants to do it? I’d be happy to post stuff and check in now and again. There are three Universal Credit pages/groups – might it work to use one of those for discussion?

Also have you all seen the Universal Credit site? Lots of stuff on there, been going quite a while, following thepassage of the legislation, better informed than me… also inviting discussion and contributions.

I am planning to concentrate on getting the briefing paper together. I haven’t sent it to anyone ‘formal’ yet, and my gut feeling is I should do this first. I can put it on here as a downloadable pdf then we can all send it to our various bodies and organisations. And my other priority is to contact HMRC about the ridiculous tax and VAT thing – a mistake, surely.

But very first I’m wading through the other regulations, the more technical ones…

13/04/2013 21:07

How will this affect people who are currently,self employed Thanks

14/04/2013 11:38

Hi Carla, I’m just reading the Universal Credit (Transitional Provisions) Regulations 2013 which I hope will enlighten me a little more about the technicalities and timescale. But I think, as a general principle, those currently self-employed and on Tax Credits will, when migrated to (or told to apply for) Universal Credit, be asked to attend a ‘work focused interview’ to assess whether they are in ‘gainful self employment’ (see para.1 above). Those currently self-employed but not on Tax Credits will have to make a fresh claim for UC. Whether it would be better to claim WTC now if you are not already doing so, I’m not sure (but hope to get clearer on this after reading the other regulations.

But really, I would recommend writing to your MP, HMRC and the DWP to ask how it will affect you. We shouldn’t be having to puzzle this out for ourselves.

15/04/2013 16:32

Thanks for the reply, it is worrying I am currently on wtc, and i am homeschooling, only answer i can see is to go where we can grow food all year round….this is gonna make things really difficult in this temperate climate

Gary Stewart
13/04/2013 23:26

Hi Cathy,

I’ve just shared the address of this article with the Secretary of the BeeFarmers Association. I would like to urge everyone who reads this article to share it far and wide. I had no idea theses changes were so significant until I read it here. Thank for such good work Cathy

Rod Coombes
14/04/2013 10:31

Thankyou for your hard work.I teach 16-19 students music business and have just completed a how-to on Self Employed Taxation.Now I will have to bring them bad news.This is a total nightmare for all self employed musicians.This is the beginning of 1984 ! It is not really a conpiracy theory to mention that we will all (except the 1%) end up as slaves

14/04/2013 14:14

Thank you for putting this up: I have been trying to establish my self as a painter along-side studying for a part-time degree and working part-time and I, too feel that as a single mother I have made the most of my time on tax credits. I completely agree with your statement that, industrious people are going to be made to feel as though they are back on the welfare… I finish my degree this year in June ( expect to get a first!) and I am already putting pressure on myself to find some more related work to avoid the horror of what’s coming. This post has made me feel a little less isolated and fearful of the future: it is well researched and good to see other people in similar circumstances. I also love the rest of the website, by the way…

Nina Vangerow
15/04/2013 10:51

this is brilliant! Thank you so much! I am in a similar position, single mum, home schooling a 12 year old, running my own business. And I am rather petrified of how this is going to affect me.

15/04/2013 10:56

An excellent and very worrying article, but there’s another big point you didn’t pick up on. Many self employed people get paid in dividends which are every 6 or 12 months. Will anything over £6000 be counted as “savings” even if it is not, and is just to cover bills over the next year!? Even for non self-employed people this seems quite dangerous as it discourages anyone from keeping emergency money for expenses and instead risks pushing them into borrowing and hardship whenever they encounter a temporary financial problem!

15/04/2013 11:37

Hi Garry, Thanks for this. Can you tell me a bit more? Do you mean self employed people who are director/shareholders of a limited company, or is there a whole phenomenon out there I’ve not come across? I think there are two issues with lump sums – that of income and expenditure coming in different months and, as you say, savings. Business assets don’t count as capital, but does that include cash, I wonder. It may mean looking in different legislation altogether (taxation possibly) to find the definition of ‘assets’. I’ll certainly add it to my list of questions (which I plan shortly to be sending to various governmental bodies). It is awful – but so awful, I feel, that it surely can’t be right. It could be simply that the legislation has been devised and drafted by people who have never run a small business and don’t understand the implications. Or I have misunderstood the Regulations. If it’s the latter, I want to clarify it; if it’s the former, it needs to be challenged and changed. Please, please take it up with your MP / trade body / etc.

One thing: I hope I didn’t give the impression by focusing on the self-employed that I think the rules are going to be OK for everyone else. I don’t, and it’s not. Application of many of the principles will have a detrimental effect on self-employed, employed and unemployed alike. It’s just the self-employed issues that really fired my enthusiasm and also narrows it down to a manageable level.

Gary Stewart
15/04/2013 13:50

Hi Cathy,

I believe cash held in notes or in bank credit is not defined as a business asset if you are a sole trader. Any cash in your bank account is considered available to spend on bills,etc by the authorities. I think Garry is talking about being a self-employed sub contractor for a limited company. Some people set up limited companies ( a distinct legal entity) and pay them selves as an employee or sub contractor of their own limited company.

I think why this legislation is changing is because some people set up toy business,eg, making a few bracelets and selling them at festivals in order to get more benefits than JSA and staying out of the onerous reaches of DWP. They are playing the system.The new rules counteract this but will affect a lot of legitimate small businesses as a result an d as you say in your article, destroy small scale business entrepreneurial effort.

We need to be honest with ourselves, if playing the system is one’s main priority, then changing dates of expenses and payments will help. but that will limit the potential of your business. Staying to close to your comfort zone. I reckon most people reading this will have legitimate worries that the changes will affect how much money they will have at the end of the month, running their legitimate businesses around bringing up a family with real life limitation to the growth of their business, this is why people need top ups to counteract the inflation created by the psychopathic corporations. but some will just be worried that they will have to find a new way to play the system. if we just try to fit into their rules we will always be their slaves. Permaculture is one of the ways to stand free the attempted corporate take over of the world.

Adrian Taylor
16/04/2013 00:30

Hi Gary, if you use the language of “playing the system” then the system will be removed as we are about to witness and we may as well let our governance be taken over by daily mail readers polls 🙂

Any benefit system HAS to be one that is playable or abusable by a minority, there is always wastage, there is no 100% success here
You either have to accept that there will be wastage or you just cast everyone out to the wolves
This is an attempt to micro manage peoples lives, if it where possible then i’m sure that the government would monitor each self employed person 24/7… if that sound ridiculous then you have to accept the fact that you personally do not get to decide about who is or is not worthy..
I mean this in good humour, and am not attacking you personally

Gary Stewart
16/04/2013 21:20

Hi Adrian,

I agree with you, this does sound more like social engineering than anything else. You’re right, there will always be those who abuse the system and the “casting people to the wolves” is probably to create more unemployed to keep wages down and create more minimum wage jobs. It doesn’t sound to me like it’s here to benefit people.

However, my real point was that I think it’s dangerous for us to mould ourselves around their system. It helps to create the zombie mentality that keeps people passive and accepting their lot. Forming a business that works around the benefits system is never going to make a good business and will just make life more complicated. Of course, be clever and don’t lose benefits you don’t have to, if you need them. But thinking that “free” money is better than earned money is not healthy in my opinion.

I don’t make any distinction as to who is worthy or not, Just to be honest with ourselves for our own sake.

Emma Davies link

15/04/2013 16:48

This is all very very worrying. I have been self employed since 2006, and up until 2010, a single parent. I am an artist and educator, working in schools and organisations such as theatres providing art workshops etc. Much like being an actor, my work is unpredictable – each month is different (i.e. feast or famine) . Being on Tax Credits has enabled me to steadily develop my business, grow in reputation and client list becoming increasingly impressive. However, income remains level – when the recession hit, funding the arts slashed and schools recieving less funding – lees money to pay artists to work woth young people. But despite this, I have carried on – knowing that my business was valid, sustainable and viable. I was proving its need through being asked back by clients and word spreading. Based from home I have been able to work part time on this business while being able to be there for my daughter. The Tax Credit System, was fantastic because just once a year did I need to ‘check in’ and the change in Tax Credits awarded each year wasn’t so great that it wasn’t un managable. Will I now have to report in each month? Prove my viability? This will demoralize so many people who have worked hard on their business. This will make my feel lime I am ‘scrounging’ again. And not to mention the admin time needed each month to fill in forms – and then the absolute worry each time that your finances will be seriously effected – it’s the unpredicability of it all. And the cost to the governement processing all the individual cases? Because I can see there will be so many appeals.
I really don’t understand their logic – and this will seriously effect small businesses and their creative, progressive and inspiring work.
Like you Cathy, I have made my Tax Credits and small income stretch – I have never claimed Free School Meals, have always paid for school trips, uniform etc… and try and live a sustainable life style. I have done my best to not be a ‘financial burden’. The Tax Credit System enabled me to be there for my daughter as a parent should be, work and be hard working to develop a successful (albeit small) business. And, like you Cathy – have developed my business so that it will be my pension – I don’t intend to stop work at 65 – the nature of my work means that I can carry on until I drop – and I intend and want to. I don’t want to give all this up!

Kev Gorringe
15/04/2013 17:34

Thanks for all your work and investigation into this. I am just starting out as a self employed bike mechanic and will have to look into benefits. I know next to nothing about how to be self employed or how to claim any benefits for it but reading your piece has made me think that I have to sort it out and quick. I can’t say that it made for comfortable reading but I’m very glad that I did read it. Thanks again and all the very best to you.

19/04/2013 16:11

Hi Kev, At present Working Tax credit is available based on the number of hours work you do rather than earnings (up to quite a high level at least). HMRC have a calculator on their website to tell you if you are entitled. You have to phone them and they send you a form. If you have any queries, I’m sure the CAB can help you – they’re not great with the self-employed side of it, but they are excellent with benefits.

15/04/2013 17:53

I think this is already in play to some extent – for instance the £6000 savings allocated for full housing benefit support includes not only savings accounts but current accounts – I pointed out that 850 of my 1000 in cuurent account was for council tax and rent in a weeks time but it was still included in my savings amount – so I was over the 6000 and had the deduction per £250 by local council. I was also told I could not deduct mileage allowance as I do on my self-employment records, but just basic petrol as an expense.

My self-employment definitely does not earn me 35 hours at basic rate yet though I put in the hours, so basically it will end a lot of people’s self-employment possibilities unless it is part time on top of a employed position. I can’t understand where they think these jobs will come from – I have applied for 50 jobs in 2 months with no luck and have a degree, computer skills and various other skills.

My boyfriend has just started a carpentry business in July and has loans for his equipment, van etc – the rules on those repayments not being deducted from income are absolutely ridiculous and he may not be able to make a go of it with all these restrictions, if he needed some support – at present he is not claiming any support though he made a loss this year and would be elligible.

Thank you for being so clear with the details – I can’t see how this helps the economy at all – so many people wont be able to offer their services/products and there will be even more people for the jobs that aren’t there !

19/04/2013 16:19

Hi Julia, Yes, the capital limits have applied to means tested benefits for a long time, but until now have not applied to Tax Credits. I get Council Tax Benefit, and I have the same issue with needing to keep capital below the limit. I think there has been some discretion as to how the local authorities apply the legislation. I didn’t have any problems with vehicle expenses. South Hams produce their own form and it has a completely bizarre list of expenses. When I queried it, they told me I could cross them out and just write my actual categories of expense under ‘Other’. But at least I knew that if I ultimately went over the limit (although I never actually have) it wouldn’t affect my Tax Credits. Under the new system, it will affect everything.

John of Wessex
15/04/2013 22:18

E-mail to my MP – Dvid Heath

Dear Mr Heath,

I have been looking at this summary of Universal Credit and what it means for the self employed

I am advised by those who have worked on this aspect of Universal Credit that it is accurate.

As Secretary of State for Agriculture, I would be interested to know what you opinions are on the effect that it is likley to have on seasonal businesses such as farming, tourism and related areas.

There is a clear intention to take benefits away from those who are not in gainful self employment. I note however that there are a large number of profitable businesses eg Retail (Top Shop, Amazon, Starbucks, Tesco’s) who seem to make reasonable profits, avoid Tax but not pay their staff a living wage. If you are to withdraw benefits from self employed workers who do not make a reasonable income, should you not, by the same token be making profitable businesses pay their workers at a level that means they do not require state support.

As a taxpayer, I resent having my taxes used to support employees whose employers do not pay a living wage.

Please can you advise me if you propose to take any action on this.

Yours Sincerley

16/04/2013 12:12

Hi John, Thanks for posting this. I’ll be interested to see the reply.

Also, very glad to see you have been told that my summary is accurate. I’ve been working alone on this, haven’t checked with anyone else. I had a nasty little feeling at the back of my mind that I might have got it wrong and worried everyone for nothing! Who was it you showed it to?

15/04/2013 23:44

My heart sinks as I struggle to work part time in the NHS, subsidising my income with private work, a sole trader, as a therapist, whilst raising my 2 young children, one of whom has a rare lung disease. Thanks for the heads up on this, I will either have to keep abreast of it all or maybe give up??

19/04/2013 16:30

Hi Carolyn, Get some advice before you give up. Because depending on the age of your children, and your status as a carer of your child with the lung disease, your expected hours may well be much lower. So your part time job might be enough to fulfill this requirement, and if so you’ll be free to do your therapy work as and when – just declaring your income monthly (but without MIF or WRR applying). I don’t know if the CAB are advising on UC yet – they normally do it very much in the ‘here and now’. Their system will change on the day the legislation rolls out. But if they get a lot of clients wanting pre-UC advice, it may be taken up as a social policy issue, either locally or nationally. And the CAB are great campaigners!

Adrian Taylor
16/04/2013 00:21

Hi Cathy,

Many thanks for going through the legislation for the benefit of all of us.
I know so many people in the performing arts music and Design who will be deeply effected by these highly micro managing regulations. I simply do not see the advantage of any of the changes whatsoever apart fro an obvious attempt by government to drive the artists, creatives and strivers to the dole queue.
I despair for this country, a huge part of our modern culture has been created by people on very low income lifesyles, which enable them to think outside the box.
It’s anti competitive… loading the dice against the poor who try and set up in business
We will end up being serviced by the unimaginitive

thanks again

I heard about your page from a link on facebook by the way

19/04/2013 16:35

Hi Adrian, I’m interested that you used the term ‘anti-competitive’. I see it like that too… and I wonder if it is worth looking at EC legislation. It would be another string to our bow if the legislation was found to be incompatible. I’m not a European Law expert (I hated it) but it might be worth looking at if, in due course, one of us is going to appeal.

16/04/2013 00:29

Hi Cathy this is really useful, thank you, I have read the document, but as a self employed mobile hairdresser I was assisted by Job Centre Plus in securing a £1000 business loan etc. provided with a mentor and have filed 1 years tax return, my business is as a sole trader, however my business has a permanant need to re stock products and have had to replace equipment, in additon to the start up costs as my business is growing slowly but surely i have had to re-invest for other items, I have for example my first wedding booking this year, I need assistance with the job so will have to pay for someone to help me with that, and have had to buy addition items in addition to start up stock and equipment so how can they say that despite ploughing some of my earnings (a lot at first which is only to be expected surely) back into my business It cannot be taken into account, it is also seasonal for example I had 2 very quiet months in January an Feb 2013, but have been extremly busy the past 2 months, and as I am curretly half way through my second year can see a trend and pattern forming, some months I work enough hours others I dont, but I do consultations with “new” clients, I also have to set time and travel allowance aside to visit the wholesalers most weeks is that classed as work)….if they deem my business as “not” viable” am I then supposed to sign on? if thats the case what about oustanding tax? outstanding business loan? how do I repay that? also I pay Class 1 and 2 nat ins. business insurance and my car insurance is for business use, plus I may only travel short distances between clients, but my car still needs maintenance, MOT, Road Tax etc. and is essential to the business……I am really worried about this, I dont know whay they are expecting me to do if I dont reach the “vible critria” how can I grow my business if I have to get an additional job (I have just ordered and paid for more advertising flyers) I also undertook further training as a barber during the first year (I funded this) in order to add an additional service which there was proving to be a demand for and has paid off but I still had to invest financialy from my earnings for the equipment I required to provide the service i.e. elctrical clippers and guard, I now have whole famalies, and some extended families too…..During the first 6 months I did also have a 6 month temporary job of 22 hours whilst I was starting up to help subsidise and support me in the early stages of the business, but found it to be restrictive to my business, (I had to work saturday, now one of my busiest days) and I also worked evenings for my clients, because I was restricted by the employed jobs hours…..if I have to give up my little business I will be devastated, left with an awful lot of redundant equipment, some stock and debt due to paying back the business loan for a further 2 years, and possibly a tax bill to pay, I know I am physically not capable for a sustained period of time to work and grow the business, work part time employed, and take care of a home and 2 teenage children. I have tried selling Jewellery as a sideline, it didnt take off, looked into renting a chair in a salon, but the issue with that is you need a client list to take with you and my clients are with me because its more convenient and cheaper than visiting a salon, unless the salon is located in a busy “passing trade area” I have tried a lot of salons in lots of areas for part time hours, and always keep my eye on the job market to see if a suitable job with a few regular hours are out there, applied for some but have been unssuccesful to date, working tax credits I rely on, to lose this will mean the collapse of my business and force me to sign on and look for alternative and available jobs (seemingly with no choice in what I have to do/work wise, this is just incredibly unfair : (

16/04/2013 12:07

Thank you all so much for taking the time to comment. I am absolutely fascinated by your stories and by how many different circumstances will be adversely affected by the rules. I guessed as much, but it was a gut feeling rather than based on empirical evidence. Please do reproduce your comments as letters to your MP. I really hope the rules are just badly thought out rather than malicious, and will be altered if the right individuals are made aware.

Rachel Brewin
16/04/2013 16:29

Thanks so much Cathy for putting this together. My partner and I are self-employed as artists/designers and like many earn well below minimum wage for the hours put in – tax credits help bridge the gap. We don’t claim housing benefit and pay full council tax. I consider myself lucky that I also have a part-time, reasonably secure (real contract and hours) job. I don’t think we will be able to face trying claiming universal credit with the rules as they are (which is of course what the govt. want). Instead either one or both of us will try to find an extra part-time (probably crappy low wage zero hours) job and cut back on trying to be self-employed. I suspect that many others will be forced to give up sole trading altogether and declare themselves unemployed. I know so many people in this position, artists, musicians, technicians, performers, sellers etc. The govt. have no idea of the chaos they are about to unleash on society, they have created the perfect s**tstorm.

16/04/2013 18:11

Hi Cathy

Great article and a subject which I’ve been trying to find out for a long time as a disabled writer who makes hardly any money. At the moment I’m being migrated but always thought that Working Tax Credits for disabled person would be something I could do but not now, alas, as far as I know.

After receiving the pdf on UC I went to look at the Self-Emploment Section and posed a question to Benefits&Work but they aren’t geared up for dealing with UC yet.

This was the question I asked (a copy and paste job) using info from the UC pdf:

“I wonder if anyone can clarify this. The relevant bits are copied and pasted from the Universal Credit pdf. I’m taking from this that the Minimum In come Floor doesn’t apply to some disabled people eg those in the Support Group and maybe those in the WRAG ie those in the WRAG are only subject to work preparation early, aren’t they?

Gainful self-employment
Minimum income floor
62.—(1) Where, in any assessment period, a claimant is in gainful self-employment (see
regulation 64) and the claimant’s earned income in respect of that assessment period is less than the minimum income floor, the claimant is to be treated as having earned income equal to the minimum income floor……….

(5) Paragraph (1) does not apply where—
(a) Regulation 2A was inserted by S.I.2012/822.
(a) the assessment period falls within a start-up period or is the assessment period in which
a start-up period begins or ends; or
(b) the claimant falls within any of the following sections of the Act—
(i) section 19 (claimants subject to no work-related requirements), except by virtue of
regulation 90,
(ii) section 20 (claimants subject to a work focused interview requirement only), or
(iii) section 21 (claimants subject to a work preparation requirement only).

It’s the last 3 points I am wondering about.”

So, if disabled people find themselves in the WRAG they will surely still be only subject to work-prep only, won’t they? Also under the Equality Act a disabled person is allowed to limit their hours (so as not to be denied the opportunity to work and this includes self-employment). There will also be an earnings disregard for disabled people as far as I can make out so that even if you are not able to ‘earn’ the equivalent to the minimum wage you still won’t lose money until you have used up your disregard. Obviously this only works the less hours you are doing. This is me just trying to make sense of it so if anyone can confirm or deny, please let me know.

Cathy, I see from your website that you are in Totnes! So am I! I have written to our MP all through the progress of the Welfare Reform Bill to no avail.

16/04/2013 19:01

Hi Jaki, I think in principle you’re right: the fewer ‘expected hours’. the lower you ‘individual threshold’, the higher your ‘work allowance’ and the more ‘elements’ you are entitled to claim for, the more you will have left after the deemed income is deducted. But how much that will actually be is a complicated calculation I haven’t attempted yet. There are some online calculators (I’ll try and find one) and I am sure the CAB will be able to work it out – but possibly not until it actually comes in. But I think whether you only have to do ‘work preparation’ is based on the factual extent and characteristics of your disability (or what is found as ‘fact’ by whoever assess you, no doubt). There are more details in Schedules 6-9 of the Regulations – I only skimmed through them, but they might shed some light on it.

Karen Evans
16/04/2013 18:56

I have just had this passed on to me via Facebook. Thank you for all the work that you have put into this, it is quite a feat to trawl through this stuff, never mind get your head around it and understand it enough to explain it. Thank you. I am a single mum, as are many of my friends and the implications of this are quite scary. We live in Totnes too and a friend and I (talking about this) wondered if it might be feasible to ask a few people to write to our MP and ask the MP to organise a meeting with someone from the Universal Credits office so that many of our concerns can be answered. Do you think that this might be possible?

18/04/2013 18:06

Hi Karen

There is also a very small ‘Totnes Claimants Union’ group in Totnes. Mainly a campaigning group. You can find us on Facebook (sorry, I’ve not updated it recently):

Or via email:

I’ve found our MP just goes with the party line.

19/04/2013 16:54

Hi Jaki, Thanks for the link to the Totnes Claimant Union. I thought I’d heard rumour of one, but couldn’t find a website. I’ll check out the Facebook page when I’ve got a moment.

I wouldn’t expect Sarah Wollaston to be much use as regards voting for or against legislation, but she still has a duty to represent her constituents on a personal level. That ought to include making enquiries as to how the regulations will be implemented, taking up issues with ministers, formally asking questions, etc. I’m not sure if there is any constitutional requirement for her to do so, but SOUTH HAMS MP REFUSES TO ASK QUESTIONS would make a nice headline in the free paper!

19/04/2013 16:44

Hi Karen, It would certainly be interesting to see if they would oblige in setting up such a meeting and, if so, whom they would send and what they would say. Not my sort of thing, personally. Unless they let us tape record the meeting (my, that would get us off on the wrong foot!) I wouldn’t really trust anything they said. I Iike to have everything in writing – especially assurances made by government bodies. But if you decide to do it, please do let me know how you get on.

16/04/2013 20:24

wonderful work, you make a very valuable contribution to our green economy and I’m very happy to be considered a supporter of your campaign…please keep us up to date on any progress you make or need help with. I shall write to as many orgs as possible and look forward to being able to quote you on your finished article 🙂

19/04/2013 17:03

Hi Jo, I don’t really have any authority worthy of quoting, but I’m pretty confident that my research is complete and accurate enough for general release if you want to do so. I am still working on the briefing sheet, which is essentially the same content but a little less colloquial in style. I will make this available for download, and it can then be printed out or sent as an attachment. I think that will be better than trying to get MPs / etc to take seriously something written in a personal blog.

Denis France

17/04/2013 01:59

This looks like a bit of a nightmare but hopefully my business will reach the point where I can stop claiming WTC later this year. If it does not then these rules may help to keep my business from succeeding by forcing me to spend ££ needed to further the business on personal sustenance therefore hindering my cashflow and restricting business growth – which raises the point: In the long term do they want people to be self supporting or do they really wish to force us into the gutter? Gut instinct suggests the latter. However, as a director of a ltd company and a sole trader, from my interpretation of your interpretation it seems that there may be a way forward (correct me if I am wrong): Ltd companies have been the preserve of the rich as one really needs an accountant to deal with the bureaucracy which is expensive, but tax deductible. Ltd co’s with single directors (as mine is) will be treated as sole traders but what is to stop me taking on some token shareholders with a few shares each to get around this rule. If this works then can sole traders not convert to ltd co’s and do likewise? I am going to share your breakdown with my accountant and see what she thinks. Thanks for the work you have put in to decipher this for us, hopefully we can find our way through it together.

17/04/2013 15:25

Hi Denis, My interpretation of what the ‘treat company as a sole trader’ thing might mean was only a guess, so please don’t base anything on it. Please do ask your accountant, and let me know what she says (contact me direct if you don’t want to post it here). She probably won’t know, but may be able to hazard a better guess than us and if not, may want to find out (or maybe her professional body will). There might be a definition in the Companies Act, but they don’t make reference that in the UC Regulations, as they do with some other definitions. I wonder if they’ve left it vague on purpose, so that it becomes a question of fact. But it is one of the questions I’d like answered by the DWP. We need to know.

charlie fox
17/04/2013 12:32

Excellent summary of the looming UC train wreck. I was one of the 12,000 self employed people claiming WFTC who were ‘investigated’ last autumn. If I hadn’t known that lots of other people were being put through hell I would have been totally panicked by the horrible letter from HMRC. No I hadn’t done anything wrong but they really scared me. I had a taste of what the UC regime is going to be like and at the end of the financial year I stopped work and became a full time carer. So much for saving public money, I am going to have over four hundred pounds a month more than when I was getting WFTC so it is actually costing a small fortune, rather than helping me stay in work. I have a disabled child and being self employed meant I could work around his support needs. I would rather have my job back even though it means less money but I’m not prepared to be terrorised again.

18/04/2013 11:23

Hi Charlie, I hadn’t heard about the self-employed on Tax Credits being investigated. Is this something other than a normal quota of spot checks? I have heard reports that HMRC are particularly brutal in their investigations – I’ve no reason to think that the DWP would be the same. What worries me is the frustration of trying to explain my business to some spotty clerk who calls me “yourself” and talks about what they are trying to do “going forward” – doubtless a completely inaccurate and stereotyped image! They do say that the scrutiny is intended to help us – and it might help some people. I have a – possibly optimistic – hope that it might help people who are in fact employed but whose employers insist on calling them ‘self-employed’, thereby avoiding PAYE, NICs, employer’s liability insurance and employment law. Of course it may just lead to them being sacked. I don’t know. But I really hope people won’t be scared off from claiming UC: I’m hoping people will claim, then challenge the bits that make it unworkable.

18/04/2013 10:29

I am a self-employed yoga/art/French teacher, and don’t earn enough to pay tax. I feel embarrassingly ignorant about Tax Credits, etc. I always assume I’m/we’re not allowed anything because my husband works. He’s always earnt about £20 more than the level where we could have help with student loans, etc, so I assume we’re not entitled to Tax Credits etc.

18/04/2013 12:44

Hi, this is a very informative post.
I am intending to go back into further education and I refer to your “what can we do” segment. With regards to making a transition into FE what in your view would bd the benefits of this under UC system as you see it.

Lisa Bedding
18/04/2013 13:02

Thank you for putting this together – I have been telling people about this for a while now but couldn’t find up to date info in one place to be able to share. I am in exactly the same position as you, although I now have an 8 month old baby so as you can imagine i never have free time as I have to work in the evening as I can’t afford childcare. I am really, really worried about this – under these rules time off sick (when you’ve got 4 kids, that’s inevitable) and holidays are just not feasible as it would affect monthly income :(. I can’t buy a van as I need a car with 5 seats so am stuffed there too. I’m so angry about this and am going to try and do all I can to challenge it.

18/04/2013 13:12

Hi Sophia, I’m not entirely sure what you mean (or maybe I was unclear about what I meant in ‘What we can do’ about !). Further education is (from memory – I haven’t time to look it up now) not included in the ‘requirement not to be in education’. As for higher education, the general rule is that you can’t claim UC if you are in full time HE, therefore my suggestion was that those wanting to do an HE course, carry in their business and claim UC could do so part time. If you are responsible for for a child or young person (mostly kids in full time education) you are also exempt from the ‘not in full time education’ rule. So going into HE while you have children might also work for some people. I think I laid all this out in detail, with references, in the main numbered paragraphs above. However I don’t interpret the legislation as there being any benefits as such into going into FE or HE under UC. Largely the two seem to be incompatible.

Cecilia Busby
18/04/2013 20:31

Thanks for this – this really affects writers with huge fluctuations in income – can’t believe how stupid the system is. Have written to my MP, Geoffrey Cox, would be happy to let you know if he replies – email me if you’d like me to, or if you have any other ways I could make a fuss and shout.

18/04/2013 22:27

I found this fascinating and also terrifying. I have been ill for 20 years and am building up to going self employed, have ideas and hopes, but this news makes it all even more scary. I will only be able to work part time due to my health, this doesn’t seem to be taken into account. I am glad to have read your article, thank you so much. I hope we can somehow support each other…

19/04/2013 07:51


Someone sent me a link after I tweeted about Universal Credit and self-employment yesterday, having painstakingly waded through all the regs again, then finding you’d set it all out very clearly here.

I did a workshop at Hesfes last year which included info about these benefit changes and will be doing more workshops and surgeries this year

I also worked with the Spartacus group on papers relating to changes to Disability Living Allowance

I’d really like to confer at some point. THIS really resonates with me as I have also described myself as someone who doesn’t value ‘niceness’ as highly as openness and efficiency.

My website is about home education but people are desperate for clear up to date unscary info about universal credit and self-employment; the search terms people use to get to my site are mostly to do with the minimum income floor, and I get twice as many hits for the UC page as I do eg for the home page.

Marilyn Fox
19/04/2013 11:57

I had to give up my business and move away from Wales once my son reached working age because this *-* Is how Housing Benefit is already worked out, not on a monthly basis, but on a ‘spend all income over and above expenses on your rent’ basis! I could not afford to build my business account to upgrade my equipment etc. Travel expenses were not eligible expenses either!
*-Self-employed earnings. Once entitlement is established, payment will be based on your earnings in an assessment period of one calendar month. You report your income for that month, less any expenses you have paid out that month. The remainder will be treated as your ‘income’. You cannot carry forward any business revenue, even if you have regular, foreseeable expenditure coming up in the future. Seasonal fluctuations in income are not taken into account for the purpose of calculating self-employed earnings. If your expenses that month are greater than your income, the loss cannot be carried forward to a future month. So although the Regulations refer to ‘gross profit’, this effectively means that self employed income is assessed on the basis of business revenue rather than profit. This ludicrous notion is completely devoid of logic or fairness. How can a business be expected to treat all income as being available to live on, just because it isn’t spent that month? This is incompatible with annual accounting, and militates against ensuring that your business holds even small reserves to see you through market fluctuations let alone any notion of re-investment. See Reg.21 (Assessment periods) and Reg.57 (Self employed earnings).-*

I thought it was well known that a business can be expected not to make a profit in the first two years. How can this possibly help the economy? Mind you, if that was the aim, a £10,000,000 funeral wouldn’t be an allowable government expense would it?

22/04/2013 11:55

Hi Cathy

What a fantastically informative post – thank you for publishing! I am a lone parent working tirelessly providing Domestic Cleaning Services in Devon in-between school hours and an importer/distributor of Fair Trade products for re-sale in the UK. I try hard not to rely on welfare benefits but feel that the introduction of Universal Credit will adversely affect any entrepreneurial flair that exists in the UK. Although I fully support the government in encouraging people back into / and maintaining paid work, the Draconian rules and regulations of UC are bordering on dictatorship! I’m trying to seek more clarification on deviations of the Minimum Income Threshold for self-employed lone-parents with children under the age of 13. From what I can understand the MIT is set at 35 X NMW unless the claimant meets the requirements for the lesser number of hours as per the UC Reg 88, Paragraph 2. (See below.) However no definition of lesser hours is given? The regulation implies that the claimant will have to satisfy the Secretary of State in meeting those requirements? How will that work?

Expected hours
88.—(1) The “expected number of hours per week” in relation to a claimant for the purposes of
determining their individual threshold in regulation 90 or for the purposes of regulation 95 or 97 is
35 unless some lesser number of hours applies under paragraph (2).
(2) The lesser number of hours is—
(a) where—
(i) the claimant is a relevant carer, a responsible carer or a responsible foster parent, and
(ii) the Secretary of State is satisfied that the claimant has reasonable prospects of
obtaining paid work,
the number of hours that the Secretary of State considers is compatible with those caring
(b) where the claimant is a responsible carer for a child under the age of 13, the number of
hours that the Secretary of State considers is compatible with the child’s normal school
hours (including the normal time it takes the child to travel to and from school); or
(c) where the claimant has a physical or mental impairment, the number of hours that the
Secretary of State considers is reasonable in light of the impairment.

Do you (or anyone else) know if these hours have been defined as I have been unable to gain clarification on this?
Many thanks

22/04/2013 13:54

Hi Tracey, Yes. Rubbish isn’t it. I think they probably haven’t worked it out for themselves yet. Because you have to read the ‘lesser number of hours’ thing with the various work related requirements. They say we can reduce hour expected hours to those that fit in with school hours, yet don’t tell us (or give examples of) what these might be. They also say the childrens’ travel time is included but are not clear if this means kids leaving at 8.30 to travel to school on their own (freeing us up to work) or us taking them to school and then having to travel to work after dropping them off. And if we are meant to travel as much as 90 minutes each way to work (and does this include waiting time for public transport and actual transport availability?) how do they apply this notionally? Because, if in fact you were only able to get a job a hundred miles away, you’d be doing fewer hours than if you work from home or down the street. So, reasonably, they should give you the benefit of the doubt and only apply the minimum number of hours you could be expected to work (even assuming these fictional jobs were to magic themselves into being).

Anyway, I suggest you write to your MP and ask him or her to take up this matter with the relevant minister, and perhaps also write to Iain Duncan Smith yourself. It seems to me that if they don’t sort this out it is going to give rise to a lot of appeals. If they try to come up with some rules, we need to make sure we have given them our input as to un/workability. Good luck!

23/04/2013 20:11

Hi Cathy, Thanks for replying. I totally agree with your salient points – and your example scenarios demonstrate exactly how badly thought out the UC Regulations are, particularly in relation to the lone parent self-employed. It seems utterly crazy to potentially have to take a job 90 minutes travel away (after the school run) to meet so called ‘UC conditionality’ when one could be dedicating time to working closer to (or at) home on remunerative self-employed activities! Whilst I still have some fire in my belly I am going to write to our local MP as suggested and also to Iain Duncan Smith. I have always tried to believe (!) in the notion that we live in a democratic society but recent changes in legislation are making me question so many things…I will be in touch if/when I receive a reply from the aforementioned! Thanks again for sharing and contributing to all x

05/07/2013 00:44

Hi Cathy,

Thankyou for your time helping us all with this very difficult issue.

My son is 12 soon to be 13 and i am on the verge of home educating him which i can presently do along side my self employment under the present WTC system. If i homeschool for the minimum law requirement of 12 hours per week, will this be considered as acceptable working hours for parents that home educate? Are they just going to go by the state school system of hours when deciding what hours are acceptable? I appreciate any advice… Thankyou

07/07/2013 21:21

Hi Jane, I shouldn’t think for a minute they have given any thought to this whatsoever. There aren’t any provisions that would let you use your time as home educator instead of working or doing work related activities; it’s just a question of doing your expected hours. Bu am I right in thinking the point you are making is to do with expected hours when you’ve got school age children? That is something I was wondering myself – in relation to the travel time to and from work. That’s one thing when you have an actual job, but quite another when it is a notional time used for a calculation. But I presume it is meant to be a practical thing, and if you don’t send your children to school I suppose it might not apply… It really is a question for the DWP helpline, your MP, Lord Freud and ultimately, I expect, the courts.

22/04/2013 22:27

Do they think small business owners can just walk away?

Have they not heard of personal guarantees on leases and loans?

And what about our employees?

I suggest they spend there time sorting out the recession instead of trying to make names for themselves and finding ways of paying for it.

Write to your MP.

23/04/2013 18:43

Hi Kevin, Do you think there are many self-employed people on Tax Credits who have employees? I had been considering this, hypothetically… that a sole trader might use surplus profit after their own essential drawings to pay an employee – maybe to grow the business or to buy in skills they haven’t got or just to create employment. But I don’t know anyone. Almost all my self-employed friends have micro-business and it’s just themselves. I’d be interested to get a more complete picture about this.

23/04/2013 12:48

Hi Cathy,
Thanks for you hard work and it has made such a difference to the the average high school leaver like me. Kind of similar situation to you in that I’m self employed and rely on WTC/CTC to get by. I’m single with two children. i pay my own council tax, my own mortgage. I have never ever claimed council tax benefit or asked for my interest part of my mortgage to paid. Neither have i ever claimed IS or JSA.

I have always funded myself through being employed since having children and recently I decided to take up P/T self employment rather then being employed in order to be able to work from home giving me the freedom to look after my 9 month old baby (saving the government more money).

My 2 year old boy goes to nursery and his fees are mainly funded through the child care element of WTC. If i did not get this 70% child care assistance through the current tax credit system, then working with the responsible would not be an option for me. Being eligible for the child care element under the current scheme is a lifeline for many people like me as it means i can work.

When UC kicks in, like your forum demonstrates, there are going to massive problem for self employed people generally. But what about those who have second or third homes who do not make an income from their property but are regarded as equity rich through not fault of their own?

I have rental property which I purchased when i was young in which i have placed tenants. The property is worth £200k but there is a mortgage outstanding on it for £150. There is a binding Deed of Trust in place which states that if the property is sold then £40,000 is to be repaid back to my uncle who gave me £40,000 at the time for the deposit when i purchased the property.

If i sold the property today, i’d only end up with £10,000 profit after the £150k mortgage and £40k debt has been paid back.

I’m not making a profit from the rent as the rent covers the interest only mortgage, ground rent, service charges and other landlord expenses. Since CTC and WTC is currently an income based benefit, the fact that i have second property does not affect me in anyway.

I understand under UC everything will be means tested and any equity in property over £16,000 will mean that you will automatically not be entitled to UC.

Based on my figures above, will it be seen that that I have £50,000 equity in my second home or £10,000? In order words, will the debt of £40k secured via Deed of Trust be treated in the same way as a mortgage debt?

I’m really worried that i will be forced to dispose of my second home since holding on to it is nothing but a liability. I was hoping to hang on to it as a pension pot for me for the future again saving the government more money!

If i hang on to my second home, then my guess is that my WTC/CTC will stop. Am i correct? Okay let’s say this happens, that i will get a full time job which is fine. I have the capacity to early around £1,000 to £1,200 a month full time with my current skill set. The problem is full time child care for two children whilst I got to work will cost a minimum £1,000. How the hell can i support my family and I on £200 and the small amount of money i get in child benefit????

Please please advise. Am i reading the universal credit thing wrong or is the reality? I can’t seem to find the answers anywhere. I just don’t know what to do and am going sick with worry.


23/04/2013 19:08

Hi Pappa, At some point you will need to get proper advice – I’m trying to find out whether the CAB are advising on Universal Credit yet.

It does look as though your rental property might count as capital – although if it shouldn’t if it was a business asset. That might need structuring in a particular way, but worth looking into. I’ve a feeling rental income is normally counted as unearned income – but there must be circumstances where a property business is ‘work’ (i.e. income from it is ‘earned’). In those cases, surely the property is a business asset. I’d try and look into that – maybe one of the landlords associations could advise you.

If not, I would think only your equity ought to count as capital. Regulation 47 says “Where a person and one or more other persons have a beneficial interest in a capital asset, those persons are to be treated, in the absence of evidence to the contrary, as if they were each entitled to an equal share of the whole of that beneficial interest.” That obviously envisages a beneficial interest of less than the whole – you’ll just need to show the proportion you are entitled to. Because you really do need to get it down to the £10K. That would put you within the UC entitlement – you’d just lose the ‘assumed income from capital’ amount. There wouldn’t be any point in you selling, anyway, because you’d still have the capital in cash, and if you spent it the ‘notional capital’ thing might kick in…

I really think you should get some proper advice – but if it’s paid advice from a solicitor possibly wait until UC actually comes in, or they probably won’t know how it’s going to work either. In the meantime, put all that worry-energy into writing to your MP and telling them about your circumstances, and take it up with the landlord associations. If it affects you, it’s sure to affect others.

Denis Betty
23/04/2013 16:06

Wow! Thanks for sharing the results of all the research you must have done on this Cathy. It seems (intuitively) that this is another government cost cutting exercise. I can see why the country needs to save money, but the suggestion that self-employed people who need financial support are having their hobbies subsidised doesn’t seem entirely sensible to me. If these people, who (presumably) have some degree of resourcefulness and motivation, were all forced to look for work, they’d make job hunting far more competetive. Unless more jobs were created the unemployed total would surely rise. People who are struggling to find work in the current climate would find things even more difficult. Also, some of the small businesses which would become abandoned, would otherwise have been destined to grow into businesses capable of employing others… tax payers! It seems to me that this whole thing has not been thought through. Lets hope that the delays in piloting the changeover are an indicator of further problems and delays in the implementation of UC which will allow time for some common sense to be applied before this is brought in.

24/04/2013 15:47

Can anyone clarify whether self-employed people already getting Working Tax Credit who are moved to UC by DWP will get Transitional Protection? The DWP briefing note isn’t clear at all. It says that Transitional Protection will not be applied “against” the effect of the Minimum Income Floor. Does that mean they will get Transitional Protection, ie an amount equivalent to their existing Working Tax credit award, or not? Thanks if anyone knows the answer.

24/04/2013 16:17

Hi Paula, From what I can work out it is only people earning more than their individual threshold (minimum wage x expected hours) who will actually receive the equivalent. There will be some piddly little amount for people subject to minimum income floor, but not the whole lot. Also, someone pointed out that transitional protection will not make up for not being entitled to UC at all because of excess capital.

26/04/2013 19:52

I’m still not sure I understand. The guidance from DWP says that no-one will lose out in cash terms as a result of the transfer. That was a lie, yes? Because from what you say, anyone earning less than minumum wage x 35 hours every week will be worse off – am I right? What sort of sum did you envisage when referring to a piddly little amount?

27/04/2013 15:16

Hi Paula, Para. 4 of the Policy Briefing Note on Transitional Protection says “Transitional Protection will also not be offered to self-employed claimants against the effects of the Minimum In
come Floor. In these cases, the Transitional Protection calculation will be carried out prior to the Minimum Income Floor being applied. Once the Minimum Income Floor is applied the household will retain their Transitional Protection amount, but no further protection will be provided. This will ensure that claimants’ circumstances other than those related to earnings are protected.”

I think what this means is that they will do this:
(i) work out your UC award as if you were earning minimum wage x ? hours,
(ii) deduct that from what you would have had on Tax Credits,
The difference (if any ) is your transitional protection amount
(iii) deduct whatever they deduct due to your deemed earnings under the MIF, and
(iv) give you the difference calculated at (ii).

How much this will actually amount to will depend on your individual threshold and what elements you are entitled to. To work it out, you need to work out what you would get now on Tax Credits if you were earning minimum wage, then work out what you will get on UC, and see if it is less. If it is, you’ll get that amount on top of your award.

So yes, effectively IDS lied. Write to him, and your MP.

27/04/2013 15:19

There’s a Tax Credit calculator here:

27/04/2013 15:39

Actually I’ve just tried working mine out, and it might not be such a piddly amount… I’ve made mine £126.84 a week. Which (if I’ve done it correctly) (which I am not at all confident about) that is quite a lot on top of my UC amount, which I make to be £30.72, when I currently receive £203.76 on Tax Credits. I suppose I ought to start thinking in months rather than weeks – it might reduce the chance of errors. I’d be interested in other opinions if anyone else fancies working theirs out…

24/04/2013 16:15

I’m currently on income support but am due to be assessed for ESA in the next few months. I’m scared to death and panicking about losing my benefit. But I was looking at what possibilities might I have in terms of work that I could manage. I rarely leave the house and could not hold down even a part-time job. So I have considered the option to become self-employed and do transcription from home. The only problem is I don’t think I could make minimum wage. I think maybe £5 per hour. I could also not manage 35 hours a week. I would hope the government would appreciate my motivation to work and earn a living, but fear they will not be acceptable and give me no choice but to stay on disability benefits because I’m not able to go out and work like a ‘normal’ person. This just seems so unfair. They are putting up barriers everywhere I turn. Sometimes I just feel like giving up. I have even planned by own suicide if I end up in a bad way.

24/04/2013 16:25

Hi Debbie, I really feel you should be taking this up with your MP, and any support groups or organisations linked to your disability. They all need to get the real picture about how this is affecting people.

But as regards self-employment, don’t be put off in principle. Because even if you do still end up being subject to work related requirements, any hours you spend working on your business will be fewer hours you have to do anything else. Try and work out your ‘expected hours’ – I’m not really clear about how the limited capacity for work rules will be applied – it probably depends on your ‘points’. Try the CAB – if not yet, at least when UC comes in. And whatever happens, you’re not going to be any worse off having tried self-employment. You can always stop again.

24/04/2013 22:15

Thanks Cathy. I really appreciate your advice.

27/04/2013 10:45

The best thing about changing from Income Support to ESA is that you can earn some money without your benefit being affected. Slightly odd rules but either up to £20 or £95 a week for 52 weeks, after 52 weeks you have to switch to no earning or the higher/lower income rate. BUT I don’t know how this will work with UC. My next ESA assessment is November/December.
It is a bit off when you opt for the higher rate then get more ill.
I am looking at a long term goal of self employment – don’t think employment is very suitable currently, unless I can find a very flexible employer and I certainly can’t do full time.
The UC system for self employment does put me off. The monthly income accounting seems absurd. And surely it can work for and against a claiment: I work 3 months on a commision and get paid in the fourth month theefore no income for 3 months loads in the fourth. It’s been a bit tricky sending information about earnings this last year anyway because of the work being self employed, they are not really set up for that, but they have accepted me sending in accounts rather than just income in an ad hoc way. I am registered as self employed with Inland Revenue.

Cathy thank you for all this helpful information.

29/04/2013 14:08

Hi Cathy,

I’m self employed, currently claiming Working Tax Credits. This whole Universal Credit thing is a can of worms. Bottom line is it simply will not be worth my while taking at least a day a month out my working time to collate and fill out all the accounting data. I’m not an accountant, and never employ one. The annual returns are bad enough and I really have to psych myself up and change to tax mode just to get my head around it. I find that after a couple of weeks I’ve forgotten what all the numbers mean and where they are kept so I have to begin from scratch pulling it all together.

Self employment is a business of spinning plates, and if the accounting plate has to be spun monthly rather than annually, some other plates are going to fall off their poles meantime and impact the bottom line. The rule about assumed income is also a tough one, since if your business is hit by a fall in demand, there is no safety net while you catch up. I thought the safety net was the whole point of benefits, to give you a leg up if things got a little tough? A good example was the recent assault on Amazon by the press for not paying taxes. Well funnily enough, the whole of Amazon is held up by lots of small businesses and self employed sole traders who do pay taxes. My sales on Amazon dropped to half in the Christmas run-up when they should have doubled. This was all a government fueled fiasco, but it was the small guy that took the hit, slighted by customers who thought that by boycotting they were hitting the great Amazon. Under the new assumed income rules, my Universal Credit would have been reduced even though the income never materialised.

Well, working tax credits will be useful while they last. This system has enabled me to stay trading despite a strong downturn in sales following the credit crunch. Minimum wage? Joke. But I am recycling back into use, several tons a year of used books. Also helping the UK’s balance of payments by selling abroad at least double my earnings worth of sales, and regardless of how much I make an hour, surely the point of work is the amount actually achieved. The bargain books on Amazon couldn’t possibly be sold that cheaply by any outfit paying minimum wage, yet allow everyone ON mimimum wage to still enjoy reading.

01/05/2013 12:34

A brilliant and informative post. I found you via a Google search for Universal Credit for the self employed. I find the possible changes daunting. Like many I make my money stretch as far as possible and still pay full bills in a lot of cases.
I am self employed and most of my income comes from stocking shops and galleries. Work these days is usually sale or return, so I have to wait several months sometimes to be paid.
What will happen to the revamp of the high streets if interesting shops and galleries close down from lack of work submitted.
What about ploughing profits back into your business if you are supposed to use the money to live off directly.
The scenario where you are looking after an elderly parent might prove problematic if you are not allowed to work less than your alloted hours.

04/05/2013 12:47

Thank you for this . Had a good cry (my 30 year sculpture business will be ruined by this…) and now I’m ready to fight it. Gingerbread and my MP will be my first port of call.
warm regards and respect,
Rebecca Buck

Jay Davis
09/05/2013 03:53

What a joke.

I will fold my business and start claiming JSA when I am invited to the interview to gauge my entitlement to UC.

I average a turnover of £18k – profit around £6k. WTC kept me going, even so it has been stressful with a compliance review. The UC requirements are just too much and the straw that will break my camels back.

My business gave me some purpose in life, allowed me utilise services and contribute, and has stopped me from sinking into a hopeless trap of uselessness.

Well done to the Tories & IDS. I will probably never work again and will end up costing you a damn sight more. I trust you will be satisfied.

09/05/2013 19:34

I was thinking much the same. I would definitely be better off financially to not work than to get the minimum income floor hit. But the alternative would be spending 35 hours a week applying for jobs that I’d almost certainly never get (I saw an anecdotal report the other day of a small business owner who had advertised a vacancy and was drowning in admin because he received three or four thousand job applications! All of us, plus all the unemployed, all spending 35 hours a week looking for the same jobs is going to result in a lot of this. However is the poor employer ever going to find the correct employee?

But as for your comments to IDS. Please write and say it to him!

11/05/2013 22:41

Hi, I am a single parent with a 13 year-old. So far have been self-employed as a crafter, but doing bits and pieces like cleaning, writing, etc. Not making much income and considering changing my business to cleaning in september. Will this trigger a move to universla credit as a change in circumstances, or will this get me another stat up year? its all very confusing!

12/05/2013 11:47

Hi Carole, I can’t give you advice as such as I’m not qualified or insured. The CAB have started advising on Universal Credit, but whether they can do a ‘better off’ calculation on this sort of level is doubtful. When I volunteered there a few years ago they were never much use for self-employed – we referred everyone to whatever helpline it was then – some sort of Business Link thing I think. They will have up to date (and local to you) sources of business advice. They should also have some generic advice about when UC kicks in and what would trigger a claim (or migration).

My understanding of it is that it is only in Ashton Under Lyne at the moment and not in any case for self-employed. It is to be rolled out from October (unless we can prevent it?). So… if you change business in September, you will be changing business before it comes in. Presumably you are already claiming Tax Credits. That means you should be migrated automatically as and when, and should be eligible for transitional protection.

If you don’t change business until after October, I can’t say for certain whether a change of business would amount to a change of circumstances for triggering UC. I would think probably not. I would have a look at the Tax Credits ‘change of circumstances you have to tell us about’ information, because that will be the first step. If you don’t have to tell HMRC (which you may not have to until your Tax Return/Tax Credit Review) no one will know, including the DWP.

The start-up period of 12 months will (I am pretty sure) apply to businesses started within 12 months, whether or not that is under Tax Credits or UC. So to get the 12 months, I suppose in principle you might be better to start your new business after claiming UC. I’m thinking about this myself – although I don’t think it should be the paramount consideration. Starting a new business has so many other factors and implications. Also, the DWP say that the minimum income floor won’t apply to migrated claimants for the first 6 months. It all starts to get really complicated. It may be possible to get your 6 months, then start your new business and get a further 12 months, but that would depend on your status during the 6 months. I won’t speculate more. I doubt whether the DWP themselves even know this level of detail – and it wouldn’t surprise me if they just closed any (perceived) loophole as soon as they spot it.

So… not much help really. I think it will become clearer nearer the time, as it actually comes in. I had a long chat with a guy at the UC help centre the other day and he said that none of it is set in stone, it is all evolving as they get experience implementing it. I think (hope) the self-employment rules will be subject to a lot of change.

12/05/2013 11:31

DWP is moving all its stuff over to the horrible new website (huge font, much less detail) I’ve just found this which of course doesn’t have any facts about when universal credit will be broadened to include lone parents. Last info I saw re lone parents was Spring 2014, but I will keep searching.

13/05/2013 11:26

I don’t think they know this yet. From what I gathered, talking to chappie, they are doing the Pathfnder thing solely to check whether their systems work, in the practical sense. Then I suppose if they do, they’ll roll it out to new claimants in October. This will presumably include everyone – parents, self employed, couples, the lot. As for migrating the rest of us – I expect they’ll formulate their plans once they see how it goes for new claimants.

Oh, and your link… I think it is one of the pages that leads to the nitty gritty information – very hard to find – easier to go straight here:

12/05/2013 11:37

With regard to writing to Ministers, you can try writing directly to the Minister (for which an Open Letter on a blog site is recommended for publicity) but experience suggests that lots of contact with backbench constituency MPs asking them to put questions/concerns to Ministers can really pay off, as the MPs may write privately and pass you a copy of the answer which you can put on the internet or they may ask Written Question which will be answered on the record in Hansard. It’s very easy to contact MPs via Write to Them Even better if followed up with visit to constituency surgery. The current coalition split over childcare ratios indicates there may be some mileage in getting LibDems to dissent from the party line.

Yarrow (no email)
12/05/2013 11:51

Thanks Cathy for sharing your work, I have been sick with worry for the last few weeks and am striving to turn the changes into a creative opportunity, I am a single mum with a massage business and a 2 year old, I figure I have almost 3 more years to find my way out of the system, likely that I will lose my business as I am not able to sustain the minimum income level and will need to claim UC, like so many mothers with small businesses.

As far as I can see, living in a house will no longer be an option unless I subject myself to the risk of workfare.
I wonder how many people will have to return to living cheaply on the lands of benevolent land owners or community land trusts as a way to be able to raise their children rather than be forced to give 35 hrs a week labour to the system and your kids to boot, I for one don’t want my daughter to be forced into the school system and I cannot see how home schooling will be possible within the new system, except for those wealthy enough to not have to work.

I feel better after reading that I am not alone and really hope that something creative comes out of all of this awfulness.


12/05/2013 12:03

Hi Cathy

Can you post the reference for DWP saying the minimum income floor won’t apply to migrated claimants for the first 6 months? (I don’t remember this from Transition Protection, so that would be good news)

13/05/2013 11:20

Hi Fiona,

It’s on p. 3 of the Universal Credit and self-employment DWP quick guide (28 March 2013).

Click to access universal-credit-toolkit-quick-guide-self-employment.pdf

I posted the link on the Universal Credit and the Self Employed Facebook page. I don’t know if you’re a Facebook user (I’m not, not really) but I set up a page so I had somewhere to put any new stuff I come across. I will gradually update my blog post, but I needed something for people who’ve already read my post and need to be notified of new developments. It’s a bit ungainly to have to keep rereading the whole thing.

There are also some very useful resources in the Guides For Decision Making here:

Reading this is a prerequisite for getting help from the UC advice line. They are instructed to tell us to read this first, then they can answer any queries we haven’t found the answer to. I think the accessibility is dubiously from a democratic point of view, and the info wasn’t easy to find (you have to proceed as if you are making a claim), but actually it makes good reading one you get there.

It includes some stuff specifically on Universal Credit self-employed earnings –
that I haven’t had time yet to read in full, but gives some insight into interpretation.

Click to access admh4.pdf

When I’ve read it, I’ll probably need to update my info.

13/05/2013 11:37

Ta, I’m just skimming that link you gave

Click to access universal-credit-toolkit-quick-guide-self-employment.pdf

Which I hadn’t seen before. It does say

“Moving to Universal Credit
In future, if you are self-employed and on benefits, you may be moved onto Universal Credit if
your circumstances have not changed for some time. If this happens, you will not be subject
to a minimum income floor for the first six months of your claim. This will give you time to
increase your earnings and makes sure that you do not lose out due to the change.”

This is new I think?


14/05/2013 11:36

Yes, I think so. And the trouble with the ‘non-durable’ medium of the web page is they can keep tweaking it like this forever. I mean, if they tweak it in our favour, let them keep tweaking – but there are implications for certainty and transparency in the application of the law if we are not alerted to changes. Is it reasonable to expect citizens to read the whole of the DWP decision making guidance every day to see what has changed? Not really.

14/05/2013 11:48

could I urge everyone where possible to download a copy of any relevant Decision Makers Guides as they are sometimes taken down to prevent- as DWP would have it – claimants understanding how the rules can be worked around (More about this on the rightsnet forum)

15/05/2013 12:47
‘I’m getting more and more confused by information i’m finding
“A guide to Universal Credits, written especially for a-n members by Darren Moynan of Dodd and Co, explains that under UC, the self-employed will be deemed to be “gainfully self-employed”, and therefore earning at least the national minimum wage for 35 hours per week. He points out: “Even if a self-employed person incurs a loss in a [monthly] assessment period, they will still be deemed to earn £873. Furthermore, any loss incurred cannot be carried forward to offset against income of future assessment periods.”’
this is saying that it is assumed that you are earning a certain amount and that’s thatunless I have a miracle cure a full working week is impossible. was even before I went onto benefits because of health issues, and I did get help with rent & council tax.

15/05/2013 13:33

Hi Flo, I think A-N have interpreted this incorrectly. Self-employed will not be “deemed to be gainfully self-employed”. On the contrary, they will have to prove that they are, in order to avoid work related requirements. My interpretation of gainful self-employment is outlined above, with links to the Regulations.

The ‘deeming’ comes in for those held to be gainfully self-employed – whereupon they are deemed to be earning minimum wage for the expected hours. These will depend on your circumstances. I’m not very well up on health issues – you should follow the links to the Regulations or get advice from the CAB etc. Basically you want your ‘expected hours’ to be as low as possible.

One thing: I would urge everyone to follow up sources, preferably back to the legislation itself – in this case the Regulations, and interpretative guidance from the DWP. Because I expect we’ll get an increasing amount of this woolly interpretation (thinking of which, my information is due for an overhaul…).

15/05/2013 13:07

Flo I just clicked on the link you gave. Most of it seems to be behind a paywall for subscribers only so I’m just going on the first bit which is publicly available.

It seems to me that the author is less well up on this than Cathy here. Also I just googled the author and now I’m even more wary because I thought HMRC treated construction separately in many ways (certainly seems to fork at lots of points when doing the tax return..)

15/05/2013 13:35

I get the impression that A-N have (erroneously) paraphrased whatever information they got from Dodd & Co.

16/05/2013 17:52

I think there will be a very big revolt campagnie over this even more than the bedroom tax.

22/05/2013 13:20

I note your points in 8. about variable income.
Taking for example a farmer, who harvests in September.
One way round the averaging would be if it is permitted to purchase for example seed in the same month as harvest, instead of carrying that balance for several months.
If it’s possible to negotiate a discount on the seed if you give the company the money early, that would seem to be a reasonable expenditure.

23/05/2013 18:35

Hi Ian, I think it’s going to work differently for everybody – and therefore well worth calculating in advance which is best for you. Up to the minimum income floor it’s not going to matter. You’ll be assumed to be earning that anyway. Over and above MIF, income will then, ideally, correspond closely with expenditure, month by month. But once you start getting into higher incomes where you wouldn’t otherwise have been entitled to any UC, you can actually bring yourself within the scheme by having high expenditure in one or more months. A tax website pointed out that even higher rate 40% band tax payers may be entitled to UC the month that they pay their income tax! Presumably a similar thing might occur when paying quarterly VAT. The whole thing is bizarrely daft – but not surprising, I suppose, that it is the high rate tax payers who will be the ones to benefit.

24/05/2013 20:03

This is a fantastic article, thank you for taking the time to write it and research it! I am going to link it to my blog because I was trying to find out more for a post myself…don’t need it now, I’ll just direct them here!!

02/06/2013 13:11

I am about to be pension age but have been self employed for years after working in offices for about thirty years and bringing up three children. Good luck to all of you who are going to be in a situation to have to claim this benefit. I am going to give up self employment, take my pension (i will be nearly 62 when I get it) and run.

Rachel Millson
03/06/2013 22:14

Please could I have a copy of your report and thanks for putting so much work into this.

04/06/2013 12:26

Hi Rachel

I am just giving the briefing paper a quick overhaul before finally saving it as a PDF. I’ll send you a copy as soon as it’s done.

06/06/2013 11:44

I would like a copy of the briefing paper but I can download it from your web page and point others to the link when it goes up unless there is a particular reason why you wouldn’t put it the web?

08/06/2013 12:07

Hi Fiona, No, only that I haven’t finished yet and I want people to be able to give me their email address and receive it when I’ve done it, rather than to have to keep checking here or on Facebook only to find I haven’t done it yet. I’m hoping to finish it in the next few days.

11/06/2013 11:10

super blog and very helpful, well-researched, article – thanks Cathy – drop by the flea market on a friday and say Hi to the rag trader aka Karen (- assuming I’m still trading.)..

02/07/2013 08:25

Does anyone know if there are any government updates on this yet? I know everything is done quietly in the hope that we dont notice. Is it going to affect this years claim for tax credits at all?

07/07/2013 21:10

Hi Amanda,
The ‘Pathfinder’ (pilot) is happening and the DWP have issued the Advice For Decision Makers (link above), but I don’t know about anything else – although I haven’t been listening to the news for the last few weeks. It doesn’t get rolled out fully until October, and even then that will only be for new claims I believe. Whether it is likely to affect this year’s Tax Credits depends what you mean by ‘this year’. I guess if you have a change of circumstances after October it could affect your claim.

Johnny Mac
03/07/2013 09:44

What a brilliant article and resource for us all. Thank you so much for doing it in the first place and then your unstinting follow ups and responses to some increasingly worried folk out here. Who’s have thought permaculture and the internet could be a marriage made in heaven? Thanks again Cathy!

06/07/2013 15:10

home education does not have set hours or days or terms and there is no definition of “full-time” in relation to home education. I’d recommend you join the home education single parent yahoo list to discuss this further

15/07/2013 14:32

Excellent and so informative. I am a carer not claiming Income Support but juggle working on a self employed basis but claiming WTC. The Government need to wake up reading all this I wonder why I bother trying to work. Keep the good work up for people like me this is a great way of finding out the true facts.

18/07/2013 10:01

My brother is a self-employed gardener and he absolutely screws the current system into the ground. He works part time and because his rent is so low £300 per month, has a very nice lifestyle on tax credits. He makes out that he provides for his family when in reality the state does…he gets £400-500 per month and plays computer games, rides his bike and goes windsurfing whenever he chooses. Why? because he can, no-one checks up on him and for far too long people like him have got away with a wonderful scam. I think that for people like him the Universal Credit is a good idea, at the end of the day why should you get out for nout? If you claim any kind of benefits then too right you should be made to prove what exactly you`re doing to support your family. Hopefully the new system will stop people like him from scamming the state and get them out to work full-time.

25/07/2013 17:19

Thanks for the great blog and now PDF. I’m still struggling to work out whether my company (which will be hit by the “analogous to…” regs) will survive this or not. Variability of income and extra paperwork could just cripple it before I reach the stage of growing income out of UC levels. Info on how the “analogous to” bit will work was really handy and I hadn’t managed to find it anywhere else, so thanks for that especially.

03/08/2013 09:16
I was just tinkering with an idea I came up with for a currency called a Universal Human Credit [“because my time is the same as your time”] and put that into a search engine and found this. What a heads up. Thanks for your research – I’d say it is worth quite a few UHCs as you have clearly put a lot of time into this very coherent work.Funnily enough, I was recently thinking about what would happen if the WTC scheme was ended – what a major headache that would cause for so many people, like me, who have fought to keep afloat. I have sold most of my belongings [mainly my prized record collection] to keep going over these last few years, and currently live in a caravan with no running water [which does constitue ‘adequate housing’ btw, I recently discovered].

Receiving the WTC over the last year has made such a difference. I never knew it even existed till a year ago.

As I see it, what seems to be happening is a grand reckoning, where the corporation of UKPLC is conducting a ‘stock check’ on all self employed individuals. They wanna shake em all out, the blasted scroungers!

While I concede the paradox of being self employed and also receiving ‘benefits’ [which is what led me to conclude that this situation would not last forever, so this comes as no surprise] – I would never have had to claim this sort of thing had my business not failed – ENTIRELY due to the management of the ‘economy’ and banking system by flooding the country with cheap credit [housing bubble etc and crash], as well as an enormous and utterly extreme and ongoing influx of unbeleivably cheap and totally unregulated labour followed by the music stopping and a whacking ongoing depression. Anyone who has ever sold online knows that the money is finally running out – everywhwere. I used to be a decorator. There has been no decorating ‘market’ since 2007/8. Nor any market in anything else, apart from propping up insane ideas like the current banking model [money issued as debt, instead of credit. See Positive Money dot org] – or a few wars here and there. We have been running on fumes. Well, I have anyway.

So, what I see happening is the government will be rummaging around and micro examining every aspect of your ‘business’ – which might not really be a ‘business’ anymore, but an attempt, at all costs, to keep self employed status and to avoid the death spiral and crushing depression of signing on – anything to avoid that feeling where you start wishing that you worked in the jobcentre, so you can have a job pretending that there are jobs to people who know that there are none.

Akin to the Enterprise Allowance, that Thatcherite massaging of the unemployment figures, the WTC has served a very similar purpose.
And now, as it ends, it will roll up all the stragglers and absolutely ruin them, just when they needed help the most.

I will now be able to plan what to do over these next months, so I thank you for the advance warning.

03/08/2013 12:05

I found this blog by chance whilst seeking any new info on the changes to benefits from October 2013. A great post, thank you.

We are self-employed and home educate our two children. We have been watching the ‘progress’ of Universal Credit since the first reading of the Welfare Reform Bill. It is sounding to me less and less likely that UC is going to be ‘rolled out’ universally in the near future, though this has been largely kept out of the mainstream media. I came across the official DWP press release dated 10 July 2013 which details the next 6 jobcentres where UC is to be introduced from October 2013. This is the link:

Also today (3 Aug 2013) I read an article on the Guardian online that demonstrates the chaos currently enveloping the civil service department which is supposed to be putting Universal Credit in place.

… so who knows when UC will eventually come online for self-employed folk like us.

14/08/2013 09:52

Hi Cathy

well my claim went through ok for this years tax credits and even came back with projected payments for next year too 2014-15

Have you seen this?

Universal Credit needs your input.

18/08/2013 21:47

Yes, an excellent and informative website, with dedicated self-employed pages here

Universal Credit and the self employed

18/08/2013 23:42

Yes, it was their call for comments that interested me, there are still so many people out there with absolutely no idea that this is potentially coming

Charlotte E
31/08/2013 14:01

Cathy, I wonder if you can help in regards to natural migration, it has me confused!! I am due a new baby In October 2013, will we be moved over to UC? I don’t know how I’ll cope with a new baby plus the need to have DH’s books ready for montly reporting if they havent given me the guidelines as to what figures are and aren’t included? Sorry if this is off subject but the whole thing has my head spinning!

02/09/2013 12:14

Hi Charlotte, I don’t know for certain I’m afraid, but on balance I would think probably not.

I’m pretty sure that initially UC will only apply to new claims.

I don’t think having a baby would count as the sort of change of circumstances to trigger it, because it’s not a new claim (unlike if you made a claim with a new partner, say).

Also there was a DWP press release on in July that said:

“Universal Credit will expand to 6 new Jobcentres starting from October 2013. The following Jobcentres will be included:


So unless you come under one of these areas, I doubt it will start as soon as October. In which case you’ll have had the baby by the time you are migrated, and you should get Transitional Protection.

I think it’ll be some time before the self-employed get migrated. They’ll start with new claims nationally, and then the less complicated ‘legacy benefit’ claimants – the employed, the single, the childless. We should be some of the last.

As for the reporting requirements, I had a response from the DWP to some queries made via my MP, and I quote:

“”We are producing information guides to send out to those who are self-employed when they claim Universal Credit explaining what can be included in each category and details of the reporting process.”

So… when, or if (crossed fingers) you get migrated, you’ll have some simplistic government drivel to help you. The new baby will doubtless be the easy part. (Thank goodness midwives and health visitors are some of the saner manifestations of the state!)

If you do have worries though, why not pop to the CAB while you’ve got the chance. They’ll be able to look at your circumstances and advise you specifically. They are insured, have up to date information and also they will be collecting data for social policy purposes – which they will then compile into campaigning materials and feed back to the government how the system is affecting people. All good stuff.

Steve G
06/09/2013 17:29

What I would like to know is this: if you’re self employed and do not meet the requirements do you lose all benefits or just the working tax element of universal credit. This issue is not at all clear. My apologies if this has been asked before.

11/09/2013 21:45

Hi Steve, I’m pretty sure it affects it all. I haven’t got time to check now as I’m getting ready to go away for a month, but this was one of my own original queries, and I think I got it verified somewhere – maybe it was clarified by something I read in the DWP guidance, or the helpline man I spoke to might have confirmed it.

It is something I find a bit hard to get my head around. I think in some circumastances it might no’t make any difference. For example, if you fail UC due to too much capital, you wouldn’t have got Housing Benefit under the current (or recent) rules either. But you would get Child Tax Credit. In some cases – eg as regards the ridiculous cash accounting and MIF – the amount you earn (or are deemed to earn) will be deducted from the total – therefore the more elements you have the more money you will be left with. I think.

But if I were you I would ask for clarification from the helpline.

09/09/2013 04:30

Wow! unbelievably I’ve only just cottoned on to all this (thank you Cathy!)…. and there was I thinking that being on the lowest income would automatically entitle me to the same help as WTC….
My situation is pretty dire, trying to get my business off the ground I have rented my house out and luckily been able to move my 11yr old daughter and I in with my parents to save money up for all the start up costs and to save money to buy a house boat in a few yrs time because I can’t afford to buy/rent in the area I work.
So am I right in thinking that I won’t qualify at all for UC because the equity in my rented house (which is over £16000) will be seen as capital as it’s not the home I live in (even though it’s not a second home) ? ?

11/09/2013 22:18

Hi Anna, I’m not sure. It will depend on the precise application of the capital rules. At the moment the general rule for benefits (as opposed to Tax Credits) is a £16,000 cut-off, but it can be disregarded in some circumstances. If you are not able to evict your tenants, for example, you could argue that the property is not available to sell or live in. I haven’t any first hand experience of this, but there is at least scope to argue.

I don’t know how closely the new rules will follow the existing rules – there is a whole PDF on the DWP website (the link is above somewhere I think, or in my briefing paper). But from memory I don’t think it goes into this level of detail.

From a practical point of view, it’ll be a while before you are migrated – if you are not eligible in fact, that still won’t come into effect until you are required to make the actual claim for UC.

If/when you are, then definitely apply and argue, don’t just assume it will coult as capital: challenge it.

In the meantime, the helpline ought to be able to clarify this (read the guidance first). And if it does look as if it will stop you qualifying, write to your MP. And get advice. Because there may be ways round it. There may be a way of bringing the rental into a business context, therefore being business capital, with the rental counted as business income. I’m not sure who to ask though. CAB don’t do business advice. With the system not fully rolled out I don’t know who’slikely to be geared up for advising. And no legal aid for benefits advice. It’s all shit really. I think what will happen (in general, not just your circumstances) is that it will be left to the Decision Maker to make it up as they go along, from which will spawn formal guidance, possibly more – or amended – regulations and lits of legal challenges. It’s not right. The law is meant to be certain, but this just hasn’t been thought out.

Hi Ruth
11/09/2013 22:28

Interesting. Thanks for posting this.

anna (
09/09/2013 15:02

Also can anyone tell me whether the minimum hours are for every week of the year? So assuming most people have at least 4 wks holiday/yr. Then you would actually have to work 38 hrs on 48wks to average 35/wk. But how does this figure out if you have to fit your work hours round school terms, like I do, having to take at least 8 wks off to look after my 11 yr old and managing to palm her off on grandparents for the other 5 weeks of the holidays? But what if you can’t even do that? If we are allowed to be there for our kids before and after school under the UC, shouldn’t we be allowed to be there for them in their holidays? who on WTC can afford child care?! Dinner ladies are allowed tax credits if they work at least 16hrs/wk but only in school term weeks…so how on earth will it affect them if they have to work 35/ 16/ 25? hrs average for 48wks?

11/09/2013 22:50

Hi Anna, Good question. It is based on 52 weeks of the year. I think the only scope for flexibilty would be with the Expected Hours. I received a reply from my MP enclosing answersby the DWP to various of my questions, one of which related to expected hours fitting in with school hours. It was a superficial, waffly reply without any substance. Basically they said it would be up to the Decision Maker to deciide in any given circumastances. Which is utterly ridiculous, because people can’t plan their work and home lives; they have to just do what they do, then find out later how it affects them (I will write again and challenge this).

I get the nasty feeling that we are not meant to plan: we are ALWAYS meant to be doing absolutely as much work as we possibly can. We aren’t meant to choose to do less than we could, and logically we can’t do more than we can. So then the UC ‘decision’ is just a response to what ‘is’. Do you know what I mean?

It is driven by policy, so I don’t hold out much hope for the ‘school holiday’ argument you make so sensibly and reasonably. Because they want parents at work, not looking after their children. They want other people to be paid to look after their children – people being (poorly) paid to look after someone else’s children instead of looking after their own children – and so on!. I’m not clear about their objective with the ‘fitting in with school hours’. If it is so that you can get the children to and from school, I suppose they could argue that in the holidays you don’t have to do that and can be available for longer, rather than less. It’s all horrid.Nasty policy against being happy and poor.

And I guess your dinner ladies are meant to get other jobs in the holidays. Somehow. I read an anecdotal report a few months ago from somone whose small business owner friend had received 3000 or so applications for a job he was offering – obviously he couldn’t cope with it. That’s going to be another symptom: people applying for jobs they don’t want and won’t get, just to fulfil UC requirements, and at the same time making it impossible for employers to employ anyone. Madness.

09/09/2013 21:40

Hi Cathy,

I found your blog very useful and inspiring.

I have been in receipt of Working Tax Credit for over 2 years now. I am a self-employed tutor. In 2009, I made a decision to give up a full time job in London to help look after my father at home who had dementia, something I will never regret as he now has no idea who I am, and I will always cherish that time I had with him.

I’m really concerned by these changes. I earn a very low income, but not for want of trying to find more students. In fact, I have always looked for more stable work to supplement my tutoring, but once you’re out of the game, it’s very hard to get back into the job market. I have tried to find freelance proofreading work, but it’s almost impossible if you haven’t had experience in-house. And even though I have about 15 years admin experience and three degrees from London University (i worked in jobs through all of them) I have had only 3 interviews in the past 18 months or so.

I’m assuming that if I can’t put £900 in my bank account every month as proof of self-employed earnings, the DWP will just cut off the UC payment? I suppose they will force me back to the jobcentre to prove I’m looking for ‘gainful employment’ as they put it. I suppose teaching people to read and appreciate English Literature never did count for much in the eyes of the Tories, as it doesn’t make a tangible profit does it?

11/09/2013 23:01

Hi Max, There are special rules for carers. It was beyond the scope of my blog to include them in detail. From memory, I think it reduces expected hours, or changes the work related requirements. It is in the Regulations – and probably the guidance. It may be worth a visit to the CAB. If your expected hours are fewer, your deemed income will be lower. But of course we don’t know when you will be migrated, and nor how long your dad will be with us. Your circumstances might have changed…

But in principle, write to your MP and explain your circumstances. Personally I’ve got a problem with the whole thing of them holding us responsible for our own economic downturn. You’ve managed better than Woolworths, for heaven’s sake, whilst teaching and caring. Company after company makes a multi-million loss. Yet self-employed individuals on the lowest income are somewhow meant to magically make money just becuse some government body wants them to. Phah.

Right. That’s me done for the night.

19/09/2013 18:52

This is awful! I only found out about this from a comment in the Daily Mail, Googled it and hence found this blog. I restore and paint furniture i.e. Shabby Chic, and also do tarot readings. I have a 17 year old student son living at home so get tax credits. I’d hate to work for someone else – it would be my worst nightmare!

What a crazy idea – making everyone declare their income on a monthly basis too. Roll on 2015 so we can rid the country of this lousy government.

19/09/2013 20:29

Hi Lisa, there is one small glimmer of hope (as well as the ConDems not getting re-elected – although I don’t think Labour plan to drop Universal Credit either). In the reply from the DWP to my MP, they allude to some changes as regards carrying forward and carrying back profits and losses. This would be a marked improvement f= and may be worth focusing on in letters to MPs etc, just to make sure it gets done.

23/09/2013 13:20

Thanks for posting this. I am a self-employed gardener, writer, farm worker and occasional car boot/market/ebay trader and I am a voluntary conservation worker. I am also studying for a degree part-time. I am dependent on tax credits for my survival and do not receive any other benefits. The proposed changes are going to make it impossible for me to survive in these pursuits as my work is seasonal and/or pays sporadically and I am unlikely to meet the ‘gainful employment’ criteria that have been set out.

If I lose my tax credits, I will be faced with a choice of stopping my current self-employed work and seeking full-time p[aid work (of which is there is little I can do locally). It is probably quite feasible I will be able to get a menial job on minimum wage in a factory or similar – but this will mean I do not have time for my writing work which after having had around 15 articles published, is building me a good reputation and prospects for future writing jobs, I will not have time for my open university study at the rate I am studying which means I will obtain my degree in 5 years time – as opposed to the 2 years it should take me to finish it at present. My gardening/land-based work and conservaton work is seasonal and sporadic but as my degree is in Environmental Science with a strong emphasis on plant ecology, all the work I currently do is developing highly relevant and valuable skills and experience for my future.
The loss of my tax credits will mean I have to stop dedicating my very full days to these endeavours which have promise and potential to go and work full time in a factory or similar. If there are no such jobs available, I will have to sign on as unemployed in order to qualify for any help – my prospects and my current active, healthy, lifestyle that keeps me off all other benefits will cease and I have a feeling I willend up costing the state far more than I do at present.

I wonder if it would be a good idea to send a link to this discussion to the DWP et al?

24/09/2013 09:43

Hi Mari

I think you should cut and paste your comment into a Word document and send it to your MP. You explain very clearly the dilemmas and counterproductiveness of the policy.

As regards your suggestion of sending the DWP a link – my gut feeling is that it needs to be done in more of a formal way. Writing to our MPs should result in them sending a copy of the letter to the DWP minister, especially if you ask questions about what you are meant to do or how the policy will work.

24/09/2013 18:46

Hi Cathy,

Again thank you for putting together all this information, it’s given me more of an understanding how UB may affect the self-employed than any other article guidance I have had the misfortune to read.

My OH & I are farming and currently receive the Child &Working Element of TC. I find this enough of a nightmare to cope with (and have now handed it to the accountant to deal with) but it seems that UB will be worse. (BTW our accountants have said that they will not be having anything to do with it as the amount they would have to charge to cover the time involved managing it would be prohibitively expensive for their clients)

Of particular concern to me:

The variability of our income and expenditure.

What constitutes interest on a loan (we have a largish overdraft the interest of which is currently deductible).

We live in our workplace ie the farmhouse (a proportion of the running expenses is a deductible expense).

We run 2 bangers one mainly for the business (suitably old/knackered ie not to concerned about it getting bashed/dirty) and one for domestic use (slightly cleaner & a 6 seater for the whole family). Looks like we may have to change the farm vehicle for an “other” vehicle). Will I have to keep monthly mileage records for one/both vehicles & note whether it was for business or pleasure & what if heaven forbid it was for both. We try to combine journey’s wherever possible. ie going to the accountant or supplier as well as grabbing the weeks shopping/dropping kids off at various activites.

The MIF worries me I work about 30 hrs a week on the farm (child care takes up the rest) but OH works anything from 50 – 80 hrs per week. Does that mean our MIF could be based on 80+ hours.

We also have 2 rental properties which are let out and don’t know how they will be treated in the calculation.

Like many small family farms we are asset rich and cash poor. Yes we could sell up and by many person’s standards we’d be rich for all of 10 years on the downside we’d have to find a new home and jobs: which is not really the way we want to go. I’m not saying poor me BUT we already have an enormous amount of red tape/ form filling to do and would welcome the Government giving us definitive advice/guidance so that we can plan ahead. My gut feeling is that it will not be worth the effort to keep claiming UB after being transitioned.

25/09/2013 18:20

Hi Ratchete

Your situation does sound horrendously complicated, and I doubt the quality of the DWP guidance will be sophisticated enough to deal with this. As you say, you should have sufficient information to plan in advance.

It’s greatly concerning that your accountand won’t handle it. That brings another level of worry – on top of the fact that the CAB don’tnormally advise on business matters. I still think it might be worth approaching them though. After all it is your and your children’s livelihoods at stake, not really a business matter. Also although you are self-employed some matters would affect your Universal Credit irrespective of this. If nothing else the CAB should find someone to send you to for advice, and will make social policy reports to feed back to government.

One thing: MIF is based your Expected Hours not your actual hours. I think (from memory) this will normally be 35 x 2, although you can argue that one of your work weeks should be reduced to fit in with school hours.

I’m worried that lack of help and advice especially for this level of complexity will leave you and others in the hands of the Decision Maker, with no Legal Aid for appeal, even if you were savvy enough about your rights to know if tyou had grounds.

Please, please write to your MP, and ring the DWP helpline to ask their advice about each of the specific areas of concern. I’m sure it is the only way it will bring it home to them how complicated their system is for people in anything other than bog-standard circumstances.

Oh, one other thing: your rental properties might count as capital and therefore you won’t be entitled to UC at all anyway. Try and get some clarification about this. Someone else above had a rental property too – it needs to be classed a business asset – may be worth a chat with your accountants about that before UC come in.

28/10/2013 17:51

Firstly can I say what a brilliant article, I have been researching this aspect of Universal credit for the small Law Centre where I volunteer, it is the most informative and comprehensive I have found thus far. It may be that we look at writing a blog in the future about this subject would you object to us quoting (with full credit obviously) some of your facts and observations. My own personal opinion is that the punitive effect that UC is going to have on the self employed and part time workers and the intrusion into their lives will trigger massive waves of outrage. Which in turn should lead to a good amount of legal challenges. It is also interesting that so many of its effects go against the hollow rhetoric of the conservatives, it doesn’t encourage entrepreneurship and penalises hard working families, and intrudes into peoples lives – hardly small government. if they fit part time work around child care. It seems like the media have not picked up on any of this – I think the battle is only about to begin as an election comes into view. It might also be a reason it is being rolled out slowly, to stifle mass outrage?
28/10/2013 21:49

Hi Nigel, thanks for your positive comments. Yes, do quote by all means – but do please check everything with current sources. I am pretty confident that it was all accurate at the time I wrote it, but the conclusions that I drew are not 100% certain to have the effects I have identified or predicted. Also the government do keep changing things. So much is based on their web guidance for decision makers, and this they can alter very easily without formally re-publishing anything. I haven’t checked it all again or updated to reflect any new material for several months. The letter I received via my MP suggests that they may change the reporting for self-employed and provide a carry forward and carry back facility. I don’t know if this has come to fruition. But in the same way you suggest they may be slowing down implementation to stifle outrage, they may slide in small changes in a surreptitious way rather than heralding it.

I’m not optimistic there is going to be a wave of outrage though. Although profound for those affected, am not sure that the effects will be very widespread. Do you have access to any figures for self-employed likely to be affected? I didn’t manage to find anything directly useful. However I didn’t look at implications for any groups other than self-employed – part time workers will add considerably to the numbers.

I’ve been feeling continually guilty that I haven’t attempted to make any more fuss with the intention of exciting the media. I did intend to write a letter to The Guardian at least, but I never did. I put a lot of effort into the blog post and briefing paper, but then I fizzled out. If there is anything I can do or contribute, do let me know. And I will in due course be very interested to hear what happens when you start advising real clients. We haven’t got a Law Centre down here any more. Where are you based? I have been wondering how the CAB will handle the self-employed, as they don’t normally advise on business or self-employed issues. I hope the overlap with the personal, where it comes to the child element and housing element for example, will be enough. Otherwise I’m worried that the self-employed will fall through the advice net as well, particularly if the clients present it as a self-employment issue rather than a benefits/poverty issue.

I also think there is a bit of a witch-hunt against people on benefits that the media are covertly supporting. I can’t remember when I last heard anyone anywhere saying unequivocally that it is fine to be on a low income, on benefits, at home with children etc, rather than striving to get work or more work. We have to all be saying that we are trying as hard as we can to work, but [whatever]. It’s not politically correct to maintain a balanced, sane life, working slowly, sustainably to increase hours or build a business or balance home and work. We’re all meant to be manically consuming and adding to the economy – and the media seem to be complicit in this mindset. Hmmph. You’ve got me started now!

28/10/2013 21:20

This is a great blog and very helpful – I follow it with interest, lovely to hear the voice of reason when I start to feel panicky about the future. I’m assuming that if the Decision Makers decide you are to be treated ‘as if’ you are earning min wage x full time hours your entitlement then zero? Because my business is nearly making it, my living costs are relatively low, and I never, ever, want to be bullied by the Jobcentre again, so am thinking of going it alone. After 10 years in higher education I’m used to living on very little, and I cannot deal with the stress of continual threats and aggression from jobcentre employees. Anyone else in the same boat? We will suffer, and we will probably make the reforms look like they are working – ie fewer claimants – but perhaps we will stay sane!
28/10/2013 22:01

Hi Karen, My personal situation is that I was heading to have to ‘go it alone’ anyway. My youngests child is now 17 and my income is going to drop spectacularly next September when he leaves full time education. I will carry on with my Working Tax Credit until I get migrated, and then persist with UC but as much for the exercise as for the money. I’ve got a stubborn streak that makes me do things that give me a stressful life, on principle. I spent hours this afternoon writing what we in the family call ‘one of my letters’ to the Benefits Section of my local authority, who decided to suspend my Council Tax Support while I was away in Scotland because I didn’t send them my son’s wage slips, even though I had told them I’d be away. I expect I will entertain myself up to my retirement by going to Job Centre Plus (daft title) and quibbling over the small pittance that is left after the MIF, and then appealing against whatever ludicrously illogical decision they make. From a practical point of view, I expect I’ll have to end up moving out of the house and letting it, as I can’t afford the Council Tax, water rates and bills. But that would have been the case without UC. But I do worry for the people with children in rented accommodation. Whatever are they going to do? I sincerely hope the whole thing will collapse before it takes off.

28/10/2013 23:05

Hi Cathy,

I will be what you have put chimes in with my understanding. I have some links from “the Work and Pensions Committee – Universal Credit implementation: meeting the needs of vulnerable claimants” and such like im obviously happy to share anything i find – i am just at the start of my research – there is a ground swell of opposition to UC and other changes – but it is very fractured and need collecting undre one umbrella – a big job and who has the hours to do it all these days? There is a claiment’s union just starting in Birmingham, I used to be a trustee of Birmingham law Centre but it shut down in July due to changes in legal aid funding. One of the solicitors from there has started it up(claiments Union). From the ashes of that has risen the Birmingham Community Law Centre – only 3 employees and one volunteer 🙂 but we have funding and are looking for things in UC to challenge but again it is very early days at the moment i’m not sure we are officially open yet. I think there is a way of presenting UC as against tory core values – which might play well in the left wing press such as it is. I blog my self about all sorts but some politics so I know exactly how time consuming it is!

I hate what this lot are doing to people and taking welfare benefits out of the scope of legal aid at the same time overhauling the benefit system is a vile cynical ploy, compounded by their smearing of the unemployed whenever possible.

I’ll continue to do some research I’ll keep an eye on the comments here as they are very interesting and rational, and now follow you on twitter and i’ll keep you informed of any Claimant’s Union or Law Centre developments, best wishes – nigel

01/11/2013 15:19

Hi Cathy,
after yesterday’s basic start I have remade the Universal Credit blog – its a little easier to read now, your pdf is at the top of the information resource – hope you are ok with this – all updates will be on twitter – thanks for your inspiration – best wishes – nigel

05/11/2013 15:27

Thanks for the blog Cathy. It is absolutely excellent and I respect the hard work you have put in.

So many peoples’ experience above chimes with mine – I have a low income as I am a writer and my income plummetted after 2007/8: I’m just beginning to pull back but I do depend on WTC and other benefits. I pay taxes and NI and buy goods and services like millions of self-employed people in this country.

This will be a catastrophe, forcing people onto the dole instead of letting them keep their self-esteem. It seems vicious, punitive, and also incompetent and unworkable: how are they UC bureaucracy going to supervise millions of monthly accounts?

I will write to my MP. BTW it is my understanding that the best way to get to a Minister is to ask your MP to forward your letter to the minister, that way he/she has to reply.

Cathy Ashley
26/11/2013 22:18

Yes, good point. I think my MP did it automatically, as I asked questions that she obviously couldn’t answer herself. But it is probably worth spelling it out and actually asking them to forward it to the minister, in case they don’t.

06/11/2013 02:32

Dear Cathy

Thanks for your great article and help. It is very useful. There is something I don’t quite understand and my question is: Supposing I get to earn with my self-employed business the minimum income floor, equivalent of 35 hours per week at the National Minimum Wage. What support Universal Credit gives me on top of that?

And my other question is: If I earn less than the minimum income floor, means I don’t get any support at all?

At present, I live in Central London (Westminster) and I receive working tax credit and housing benefit that totals around £305 a week. I also receive council tax support on top of that.

Thanks so much for your help

26/11/2013 22:15

Hi Aris, many apologies for the delay in approving and replying – I completely forgot I had to log in and emails don’t arrive automatically can’t find how to change my Weebly email address).

There is a really complicated calculation to work out how much you will actually get. I did try it once, but I’m not sure I got it right. It depends on quite a lot of factors (housing costs, children, disability, etc) – but it’s all there in the Universal Credit Regulations if you want to try (Regs 22-25 I think).

You have to start with your Maximum Amount (I think there is a table), deduct any unearned income (rental income, share dividends etc), 65% of any earned (or notional) income in excess of your ‘work allowance’ (Reg.22 Work allowance table) . Then you add applicable ‘elements’, depending on your circumstances.

If you are eligible you should get something. Plus if your circumstances don’t change you should get a transitional payment from WTC.

If you earn less than the MIF they just treat you as if you did earn that much – that’s its intention. Basically it does away with living all or mostly on Tax Credits.

John Watson
07/11/2013 01:06

Hi, very informative article. I think the lack of information about this supposed legislation just proves how ineffective and moronic it is. How the incompetent folk at the Job Centre can be expected to manage this debacle of a system is simply beyond me. They already treat people like scum and NEVER take personal circumstances into consideration, instead reading from one of their many rule books. Utter nonsense and it will just mean people who work for poor money have to not declare it and sign on at the same time, so yeah good job government, once again you have failed to give a shit about the lower classes in society, but as we all know they are the least likely to vote so who gives a shit about them eh? Fucking arseholes of the highest callibre.

22/11/2013 13:58

Just to thank you for collating and making sense of this mess!

Stay alert folks!

nigel simons
26/11/2013 23:36

this is a good guide and calculator for the dread UC :

hope it help!

best wishes


lucy sutton-johanson
28/11/2013 22:36

Hi Cathy, I have written a very brief outline signposting people to your blog for more info, to be published on a Southsea community website. I have followed your guidelines (citing you as author etc) but just wanted to check you’re happy with this and if you wanted to see it first?
Thanks for taking the time to put such an informative post together, can’t imaging how long it took you!

Cathy Ashley
01/12/2013 19:09

Hi Lucy, Thanks for the vote of confidence. I don’t think I need to see it first – assuming your brief outline is obviously yours and there is a link to my version (as opposed to you paraphrasing me and then putting my name next to it, if you see what I mean).

04/12/2013 17:46

Thank you for the article Cathy.

Some people in these comments have said that the minimum amount of required working hours for self employed people to qualify for UC is 35 hours per week.

Does this mean that people who are self employed can only claim UC if they earn at least £11,484 per year and below £16,000 a year?

It seems bizarre.

Cathy Ashley
04/12/2013 21:51

Ha. Yes it does sound bizarre to only be able to claim if you are earning over £11,484! Although you can earn less, and they just act as if you earn more. Not sure about the £16,000. I haven’t worked out any highest earnings myself – is this specifically stated somewhere or have you (or someone else) worked it out?

Julie T
05/12/2013 21:47

Hi Cathy, I am thinking that like us you may have watched the Chancellor’s Autumn Statement to see if we can glean any more information about what is happening with the Universal Credit roll-out – particularly in relation to those of us who are self-employed. Whilst we didn’t see much directly in the Chancellor’s statement on UC, we did see this new press release document has popped up today on the Department for Work and Pensions website: “Universal Credit Progress”. It does give a little more detail on the DWP’s intended timetable. In case you’d not seen it, I thought it might be useful to add to your other information.

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Underwood Discovery Centre


Underwood Discovery Centre is an educational centre on a windswept hillside above Beeson in South Devon, home to various educational projects including Trees For Health and Discover Forest Foods. They recently held an agroforestry skillshare, and Liz Turner and Mike Rogers took us on a complete tour to show us the various projects they have underway.

The trees are still very young, maybe only a season or so old, but they have planted a huge range eventually to become a forest garden. Many of the trees are indigenous but some of them are more experimental, including a small olive grove. All the plants have a use, either as a food, as a material or as a medicine. Liz can identify each and every one, and tell us its uses, for example that holly leaves can be dry roasted in the oven and ground as a coffee substitute. Hedging trees are planted in an ‘A’ shape, with the tallest at the centre, to prevent shading of adjacent crops. A line of trees planted along the top of the hill will form a shelter belt from the northerly winds. Mike hopes the trees will raise the temperature on site by 2 degrees.
They also grow crops in an ‘alley cropping’ system again for shelter, and with the emphasis on experimentation and ‘discovery’. They grew hemp last year, to make rope with school children on educational visits, and also soya beans and edible lupins. If they can grow soyabeans on those windswept hiss I could definitely grow them in the garden. Mike talked about the differences between growing crops as a farmer rather than a gardener; how he just sows loads of seed, expecting to get both a sufficient yield and a certain amount of losses.


Back at the barn, while the vegetable broth was being served by a neighbour paid in Bridges (the Kingsbridge LETS currency), Mike demonstrated their oil press. It was different from the one that the Bell and Loxton rapeseed oil people used at the Devon County Show. This one looked more rustic and had to be heated to help the oil pass through it – presumably this is the process when it isn’t ‘cold pressed’. You can see the yellow flame above the little jar – Piteba have got a video on YouTube (but I recommend muting the sound unless you like piped music). The machine had to be cleaned immediately, or the plug of pressed husk would set hard like concrete. I tried to work out how much oil could be produced by how many acres of rape, but Mike’s farm scale calculations weren’t easily translated into my preferred ‘how much seed per plant, for how much oil’ to work out how many square feet I’d need to grow enough to keep myself in oil. Not that I like rapeseed oil very much, so it’s academic really.


The grain milling wasn’t exactly what I expected. I had visions of large machinery filling a huge barn, like in a TV programme I watched recently about oats and porridge production.  This was basically a little kitchen gadget, which unfortunately can only crush the grain. It does not remove the husks. This is the same problem I had with cracking hazel nuts. It’s just not practical to make more than a crushed-nut garnish, let alone commercially viable to sell them. This brought us back to the perennial problem of the middle-sized farm and  the economies of scale. Mike told us it costs the same to get a crop cut with scythes as it does to get a contractor in with a combine. This is a recurring theme. A garden can be managed by hand; a big farm can be worked mechanically, but small farms fall in between. Similarly with the milling of grain etc. Community owned equipment is one solution, or at least an accessible community specialist.  In Spain you take your olives to local empresas to get them turned into olive oil, like Chris Stewart did in Driving Over Lemons.


The Underwood Discovery Centre hosts groups of school children who learn to make and do things as they would have been done in ancient times. Activities have included ‘cave’ painting with earth paints, making rope from hemp grown and harvested at the centre

After lunch we cleaned out tree guards and mulched a load of trees with reclaimed cardboard and municipal compost, which we dug from a big pile and transported by buggy. I like buggies.


Like any good site visit, the tour wouldn’t have been complete without a visit to the long-drops. This one was particularly freaky – you can imagine little devils down there, forking  over the poo with their tridents. It was actually built on a split level with, I presume, some sort of red plastic at the back through which the sun was shining. Anyway, not seen one like that before, and it certainly gave the impression that it would get well compost.

Overall it was an good place for me to visit because it’s not a million miles from the sort of project I’d like to start. It provides a lot of food for thought. The barn was encouraging: it looks like a pretty standard portal frame barn, and Mike got planning permission to turn it into the education centre including sleeping accommodation – something I am likely to want to do at some point. Much as I envy the size of the land, it does have its drawbacks.  Liz had to go miles to collect a wheelbarrow when we needed one. Everything is so disbursed, and although it’s great to be able to space trees properly and grow real crops, there is so much to do that I can’t imagine ever getting on top of it. I know I need somewhere much more compact, and the principle of ‘start at the back door’ resonates more strongly than ever. One of Liz’s objectives is to feed the community, or at least to see if it is possible to feed the community. I want to grow for myself, and just flog any surplus. To try and grow for other people is too ambitious for me. I’d rather divide up the land into allotments and let people grow their own. But then you need to be near a settlement and be a bit of a people person. Without a lot of volunteers or employees a system has to be designed to maintain itself.

Reclaimed window installation

Gwydion has had a new window put in his shed. He now has the only south facing window on the property, and with a new carpet and a lick of paint it has completely lifted what was a rather gloomy, depressing place. From outside it gives the patio another dimension – and it reminds me of Spain: white walls, flat roof, dark window cavity and (briefly) blue sky above. In the evenings the little yellow glow looks cosy and pretty. It’s really nice.

Doing it has been quite exciting: sort of like Grand Designs, with project management and contractors and things like that. It was surprisingly difficult to get it all to pan out: the weather, the builder, Gwydion’s days off, waiting for paint to dry, the carpet fitters, etc. It served as a taster of how things would be if we were doing something more ambitious in the future. I think you have to use software. I just made a list, thinking ‘What has to be done before [this] can happen?’, and then it all gets scuppered by the builder leaving early, or a blizzard or whatever. Each step of the way you have to re-jig according to what has been completed, what has freshly emerged and the characteristics of what is yet to be done, – all in relationship to x number of external factors.

But at least we hardly had to buy anything. Our ‘main contractor’ (i.e. the builder) charged us £130 to cut a hole in the wall, make the frame and fit the window. We already had a pair of windows – comfortable, flaking wood windows that look as if they have been there all along, and we just had to buy a couple of extra hinges. I have already got so much stuff, what with my acquisitive nature, ample storage space, and propensity for saving everything ‘just in case’.  The frame was 4×2 from various sources, the lintel was made from the windowsill we took out of the landing, I’ve got old video cases full of every imaginable screw and nail from number 7’s skip last year and we got some putty off Freecycle. Then at the very last I was at the scaffolding yard collecting firefood and in the waste bin I found some little off-cuts that were just perfect to make the jambs. Within a few moments of arriving home they were cut and fitted. In total it cost £131.26, plus a tin of wood filler which we only used a bit of. I think we  call it ‘coming in under budget’.

Overall it was very satisfying, knowing that we have reused a load of old materials, not used many  resources and all the labour was local. The builder lives in the next street and the carpet was fitted by Carpetwise on the industrial estate. Labour is ecologically benign, saves me time and is good for the local economy, but it’s taken me a while to get my head around paying people to do things. Normally I do everything myself, and although I do get help from WWOOFers and the kids, that’s only a duplication of my own (un)skill. If I can do something I feel I should, even if that means it doesn’t in fact get done or gets done slowly or if I end up spending more on specialist tools than I would have spent on labour. The problem is that people often don’t do as good a job as I do. If I pay someone, I expect to get a better job than I would do myself, and it’s infuriating when that doesn’t happen – especially when they puffed themselves up to be some sort of artisan. Then I see the job and think ‘Bloody hell! I could have done better than that myself’. And I’ve just paid them! I end up feeling like a mug, and they want me to be grateful. There’s just too big a gulf.

So now I either use free labour or I do it myself, and I only draft people in to do something I can’t – or really don’t want to – do . Like angle grinding breeze block. Not to say that there isn’t something uncomfortable about paying people to do things you don’t want to do yourself. There he was, out in the bowels of Gwydion’s shed, dust mask, safety glasses, screeching power tool; and there was I, peering out of the window and only venturing out to take photos. It doesn’t seem right.

I think at the bottom of it all is a desire to live the sort of life where you can make, do and produce everything you need. Even though I’m a bit of a Tom-boy, I’m quite happy to go through my whole life never having owned or used an angle grinder. So when I do my Grand Design, it’s definitely going to have a timber frame.

Horsepower with Ed Hamer


Thanks to Twitter I unexpectedly found a good talk to go to in Dartington last night – one of The Earth Talks at Schumacher College. It was given by Ed Hamer, one of the co-editors of The Land who also runs a market garden CSA box scheme called Chagfood . He does all the tillage with horses – one of only 20 farmers in Britain to do so, compared with the 200,000 that used horses previously.

It is really encouraging that Ed told us he was never ‘horsy’. I have always felt prospectively disenfranchised from ‘suddenly’ getting a horse and expecting it to work with me. However, Ed has devoted a lot of time to learning the skills. He took a 3 day a week year-long apprenticeship with Jonathan Waterer at Higher Biddacott Farm, which he reckons was invaluable. The important thing is to learn how to read the horse’s mood and its reactions, in order to minimise hazards. This is partly for safety reasons – he told the story of how a new Shire horse in training took fright at some cows in a field and bolted, complete with the other horse in the pair, Jonathan, Ed and the cart – and partly because if you allow the horse to become wary or frightened you ruin its career. They just never get over it. So he definitely advocates working with someone experienced if you get the chance.

Ed then broke in his own horse – a Dartmoor/Welsh Cob cross. That’s encouraging too. He paid £120 for Sampson, whereas a ready trained horse can cost thousands. Native breeds are a good plan, because they “like being where they are” and are suited to the climate and rarely become ill. He has only called the vet once in 6 years, and that was for a cut not for illness. His horse, used to being on the moor, has hard hooves that don’t need shoeing. He is often grazed on the moor, and it only costs Ed £30 a year for oats. Yet more encouraging factors.The only thing is, you really do need a cross with a heavier horse. A straight Dartmoor or Exmoor is too small, at least to work with the tillage equipment Ed was telling us about. You could use them for a bit of light harrowing, but not for everything else.

Ed told us about two different set-ups. PROMMATA (the association for promotion of modern agriculture with traction animals) have developed modern, light-weight, ergonomic horse-powered cultivating equipment – although unfortunately for us here in England it is all in French (Google Translate). The Kassine is suitable for up to three acres and is worked with one horse and you, walking behind holding a handle. It is a sort of multi-tool affair so you do everything with the one basic machine, just changing attachments. You don’t even have to unhitch the horse to do so. The other is the Pioneer Homesteader, developed and used by the Amish. It is another multi-tool, suitable for 3 acres plus. You need 2 horses, but you can sit down. That is the big plus, although having to import it from America is a big minus.

The actual procedure is a complex set of steps whereby you turn the ground, draw it up into ridges, wait for the weeds to compost, draw it up again, weed the sides, sow on the top of the ridge, etc. It all sounds a whole lot more holistic than I had imagined. I had a rather unsophisticated (and erroneous) image of a heavy horse clomping along compressing the soil and getting its feet full of mud, and leaving a load of bare, ploughed clumps of soil between furrows that would be planted with… I don’t know:  wheat or something. In fact the cultivation process is much more sophisticated, and includes several stages of anaerobic digestion similar to the composting process. At one stage the sun warms the soil and assists with the process, and at a later stage the weeds are ‘drowned’. As for the horses, they are light-footed, walking delicately between ridges and even rows of mature plants, in a space 8-12″ wide. They put one foot in front of the other, and their back feet tread exactly where their front feet trod. I asked Ed whether this is part of the training or whether the horse naturally walks between things. His reply was more than I could have hoped for. He said that Sampson has spent a lot of time watching them nurturing the plants, and knows they are important to them!

Dear, dear horses! It just makes me want to go out and get one straight away. They need stimulation, the more you work with them the better, and either a lot of work or too little will set off a virtuous or vicious spiral up or down. If you work with them a lot, they become easy to work with and therefore you work with them easily. If you don’t work them often, they get out of practice and then it’s hard and you work with them less. Ed rides Sampson as well, and drives a cart (originally they delivered the veg boxes by horse and cart) and has made a “little trolley” that they use for carrying things around the farm. What I envisage doing is saddling up/ harnessing the horse in the morning and just hanging out with it all day, going on little jaunts, pulling a little dray with all my tat – tools, buckets, boxes of books and videos, prunings, compost, building waste, scavenged items, shopping, bottles for the bottlebank, duck food, dog food, firewood, beer… In fact it makes me wonder how I manage without one.