Page 1 of 2 12 LastLast
Results 1 to 10 of 16

Thread: JSA to UC (Premiums and Self employment)

  1. #1
    Senior Member
    Join Date
    Jan 2016
    Posts
    120

    JSA to UC (Premiums and Self employment)

    I am potentially close to be able to access a start-up loan for a small business. I will essentially be self employed.

    At the moment I am on JSA and I receive PIP, which means I get an enhanced rate of JSA (SDP, etc). I have spoken to my job coach and she just doesn't seem to know what happens with it all.

    As part of wanting my business to succeed, I don't want to take a wage in the first few months.

    I have gone through the calculator on Turn 2 US and the rate I would get would be £74.98, based on taking £0 income in a month. Is it not taking into account my disabilties and premiums? Can I not get premiums if going self employed?

    The risk of this is huge - £120/week difference.

    I am not sure what the solution is

  2. #2
    Senior Member
    Join Date
    Jan 2016
    Posts
    120
    In addition, I have just done the calculator again to see what it says if I was "unemployed and looking for work" and it doesn't take into account any disability and returns with £74.98!

  3. #3
    Senior Member nukecad's Avatar
    Join Date
    Jun 2014
    Location
    West Cumbria (Lake District)
    Posts
    10,108
    The first question - do you mean JSA or ESA?

    If it is JSA the second question has to be how long have you been claiming JSA?
    As you say you get Premiums (SDP) then it must be a number of years?

    For the moment forget using the online calculators, they are good but they need to have the right input.
    If you are saying JSA when it should be ESA then you will get the wrong answer.
    If it is IR JSA that you have been claiming for a long time then the calculators won't expect that and so may (will) give the wrong answer.
    Last edited by nukecad; 14-10-21 at 19:40.
    I don't know everything. - But I'm good at searching for, and finding, stuff.

    Migration from ESA to Universal Credit- Click here for information.

  4. #4
    Senior Member
    Join Date
    Jan 2016
    Posts
    120
    Hi. I definitely mean JSA to UC.

  5. #5
    Senior Member nukecad's Avatar
    Join Date
    Jun 2014
    Location
    West Cumbria (Lake District)
    Posts
    10,108
    Fair enough, although it seems you must have been just on the cusp of being able to claim IR JSA instead of UC.

    And just to note that none of this affects your PIP, that is not affected by other benefits or by working.

    There are no premiums in UC. (Instead the basic rates of various UC elements are supposed to 'make up' for them - they don't always).

    The calculator you used is missing something though, that's because they are set up generally to calculate brand new claims not migrations from other benefits.
    It may have given a different answer if you had input things in a different way.
    (I know that the entitledto calculator can do that, but you have to tell it to calculate for legacy benefits not UC, and then tell it what benefits/premiums you currently get, and also tell it to give a UC equivalent at the end).

    If you have SDP in an existing benefit on the day that you claim UC then you get a 'Transitional SDP Element' added to your UC.
    How much the TE would be depends on your current circumstances.
    As you have JSA and not ESA then you do not have any LCWRA element in your current benefit so the TE would be £285 a month.
    That TE will never increase, but it can be reduced by other changes to your UC entitlement. (See below about turning 25).

    Going from your saying that the calculator you used indicates £74.98 a week for a new UC claim you must be doing the calculation as a single person under 25 years of age. (And they've been a bit sloppy with the rounding in their equivalency calculation, it's actually a weekly equivalent of £74.76, although pence difference doesn't really matter because it's only an indication).

    So that means you should get a UC standard allowance of £257.33 plus a SDPTE of £285, giving a total UC entitlement of £542.33 a month.

    To get a correct weekly equivalent you multiply that by 12 months, then divide by 365 days, then multiply by 7 days to give a week.
    £542.33 x 12 / 365 x 7 = £124.81 a week.

    Note that once you reach 25 the Standard Allowance will increase, but that change would mean that the SDPTE would then decrease by the same amount leaving the same £542.33.
    So if you are close to 25 you would be better of waiting for that before claiming UC with an extra SDPTE of £285.

    Then of course there would be a Housing Element if you pay rent.
    (But again if you only get an HE added after the SDPTE that will reduce the SDPTE).

    After that you have to start looking at earnings to be deducted, that can get complicated with self-employment and the 'Minimum Income Floor'.
    The MIF means they may/can deduct 'earnings' from self-employment that you haven't actually had.
    See page 2 of this: https://www.gov.uk/government/public...nt-quick-guide
    If you’re gainfully self-employed, your Universal Credit payment may be calculated using an assumed level of earnings, called a minimum income floor. This is based on what we would expect an employed person to receive in similar circumstances.

    It’s calculated using the National Minimum Wage for your age group, multiplied by the number of hours you are expected to look for and be available for work. It also includes a notional deduction for tax and National Insurance.

    If your self-employed earnings are below the minimum income floor we have calculated for you, we will use the minimum income floor to work out your Universal Credit payment instead of your actual earnings.
    One thing that you could do is get a LCW/LCWRA entitlement in UC, that would mean that you had a 'Work Allowance' that you could earn before it affected your UC payments.
    That would generally cover any MIF so you wouldn't get deductions for imaginary earnings.
    (If it was LCWRA you would also get extra money for a LCWRA element).
    To get LCW/ LCWRA you would have to have a 'Work Capability Assessment' and a subsequent decision that said your working capabilities were 'Limited' by the affects of a medical condition.
    Which all takes time, we can be talking months to get a LCW/LCWRA decision.


    To sum all that up I'd say that it's going to be a big risk starting a self employed business in your circumstances.
    If you try and it isn't sucessful then you will not be able to go back to your current benefits and would have the UC (with SDPTE).
    Whether you think that risk is worth taking is of course your choice.

    You would also be better staying on your current benefits until you are made to move to UC by 'Managed Migration' which is still a number of years off.
    With Managed Migration you are guaranteed not to get less than your current benefits.
    I don't know everything. - But I'm good at searching for, and finding, stuff.

    Migration from ESA to Universal Credit- Click here for information.

  6. #6
    Senior Member
    Join Date
    Jan 2016
    Posts
    120
    Hi Nuke - thank you for taking the time to reply. I am however still completely confused by it.

    For reference I am over 25 and I have been on JSA for some time. I put my age in the calculator too, so I am not sure why it's still coming up with the amount, but I will try again with this.

    I have read in certain places that anyone who changes from JSA to UC and has premiums won't lose out, but it looks certain I will. Whilst my job coach seems certain I won't lose out either, even if I was moving and still unemployed.

    My rate for JSA is £194/week with all the premiums included and my PIP (I know I still get this regardless) is £113 (enhanced daily, standard mobility).

    I don't know what the solution is. Can I stay on JSA as self employed with the same rate (whilst no pay).

    Frustrating.

  7. #7
    Senior Member
    Join Date
    Jan 2016
    Posts
    120
    I have just completed the Entitledto calculator and it doesn't help that much. It says the same amount previously, then says I maybe able to get a transitional element but no amount....

  8. #8
    Senior Member
    Join Date
    Jan 2016
    Posts
    120
    This is what it says after the calculator about transitional payments:

    The transitional element is a top-up payment so that you do not lose out because of the introduction of Universal Credit. It means that, in cash terms, you cannot receive less than your current benefits.

  9. #9
    Senior Member nukecad's Avatar
    Join Date
    Jun 2014
    Location
    West Cumbria (Lake District)
    Posts
    10,108
    I'm in the pub at the moment, but the fact that you are over 25 says that something odd is going on with that calculator.
    It may be the calculator itself or how you.are inputing things?
    As you say you are over 25 I can recalculate when I get home so that you can see what you should expect to get with UC.

    The 'Nobody will be worse off on UC than current benefits' is about when you have to move to UC because the law says so.

    But in this case it does not apply because you are not being forced to change; you are choosing to change by starting working - which would stop your existing JSA.

    So your existing JSA stops because you start working (it doesn't stop simply because you have moved to UC) - Why would you expect UC to make up for that?
    I don't know everything. - But I'm good at searching for, and finding, stuff.

    Migration from ESA to Universal Credit- Click here for information.

  10. #10
    Senior Member nukecad's Avatar
    Join Date
    Jun 2014
    Location
    West Cumbria (Lake District)
    Posts
    10,108
    As an over 25 year old the UC Standard Allowance would be £325.84 a month.

    Add the SDPTE and that gives 325.84 + 285 = £610.84 a month. (Equivalent to £140.57 a week).

    Again note that you only get the SDPTE if you have SDP with an existing benefit on the day that you claim UC.
    If you have closed your JSA before claiming UC then you don't get the SDPTE.

    For completeness your current JSA is made up of:
    £74.70 Personal Allowance
    £35.10 Disability premium
    £17.20 Enhanced Disability Premium
    £67.30 SDP
    £194.30 Total JSA.

    If you move to UC yourself by Natural Migration you will lose out because although the SDP is now compensated for in Natural Migrations the 'Disability Premium' and 'EDP' are not compensated.

    If however you wait until you are made to move to UC by Managed Migration then it is all compensated for and you don't lose out.

    Yes that is unfair, (and is currently back in court being challenged for the 4th time), but it is what it is at the moment.

    BUT you have to remember that if you start work you would not be simply migrating to UC, you would be starting work which is a whole different thing.
    If UC wasn't there then you would start work and your JSA and the premiums would stop altogether - end of story.
    I don't know everything. - But I'm good at searching for, and finding, stuff.

    Migration from ESA to Universal Credit- Click here for information.

Similar Threads

  1. ESA and Partners Self Employment
    By MicheleHarshbarger in forum Benefits - help & advice on disability benefits, incapacity benefits, ESA and DLA
    Replies: 3
    Last Post: 12-12-15, 14:39
  2. Reduced earnings allowance and self employment
    By Bluebunner in forum Benefits - help & advice on disability benefits, incapacity benefits, ESA and DLA
    Replies: 2
    Last Post: 23-04-15, 11:29
  3. ESA application and self-employment
    By Hellasaurus in forum Benefits - help & advice on disability benefits, incapacity benefits, ESA and DLA
    Replies: 4
    Last Post: 29-03-15, 21:31
  4. ESA and Partners Self Employment
    By Bailey2004 in forum Benefits - help & advice on disability benefits, incapacity benefits, ESA and DLA
    Replies: 1
    Last Post: 24-03-15, 13:28

Posting Permissions

  • You may not post new threads
  • You may not post replies
  • You may not post attachments
  • You may not edit your posts
  •