Self employed

If you are self employed this page will help you when claiming Housing Benefit and Council Tax Benefit

All self-employed earners can claim Housing Benefit (HB) and/or Council Tax Benefit (CTB).

Whether you are eligible depends on your total net weekly income from your self employed earnings and any other income/capital that you may have coming into the household.

How is Self Employed Income Assessed?

When calculating what income should be used from the information supplied we have to determine the Net Profit from the proof provided.

The Net Profit is calculated as follows:

Gross Income less any Allowable Business Expense = Pre Tax Profit.

From this figure we would deduct any eligible tax and National Insurance and half of any pension contributions to obtain a Net Profit figure. This may not be the same as the Inland Revenue figure.

What are Allowable Business Expenses?

Only expenses, which the council considers to be reasonable, that are wholly incurred for the purpose of the running of the business, will be deducted from the gross income figure.

Examples of allowable expenses would include:

• Telephone
• Advertising
• Postage & stationery
• Legal & accountancy fees
• Purchase of stocks & supplies
• Business motoring expenses

Couples who are business partners

The above guidelines will also be taken into account even if the business partners are a couple; because by doing so it ensures that the deductions for notional tax and National Insurance are correctly calculated.

What if I am trading as a child minder - am I treated the same?

No. When calculating what income should be used for self employed child minders, we do not deduct business expenses. The net profit is obtained by deducting tax, national insurance contributions and any pension contributions from one third of the gross profit.

What information will I have to provide?

You will need to provide a certified set of accounts. However if these are not available, please supply your prepared accounts or your last year's income and expenditure figures.

If you cannot supply either of the above, please complete the self employed earnings form (SE2 ) that can be obtained from us and return this with your completed claim form or as soon as possible afterwards.

If you have only just started your business, you will need to estimate at least three months income and expenditure figures. If your claim is assessed on an estimated figure we will write to you after three months for actual income and expenditure figures.