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How to claim benefits when self-employed

If you’re self-employed but you can’t make ends meet then you could claim benefits. Starting up on your own is very stressful and it’s full of unforeseen hazards, so a little financial help could be the encouragement you need to continue your endeavours. Finding out how to claim benefits when self-employed can be tricky as the social security system is deliberately difficult to negotiate.
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Tax allowances

Most people realise that you can tax relief on some expenses such as the costs of goods you purchased to sell, accountancy fees, advertising, rent, rates and your utilities bills like power and water. You should take a look at hmrc.gov.uk/incometax/relief-self-emp for a breakdown of the sort of tax relief available to you.

Benefits open to self-employed

If you’re working fulltime you can claim Working Tax Credits. Housing Benefit is also open to those who work for themselves. If you pay Council Tax, you could get Council Tax support and those with children could be eligible for Child Tax Credits and Child Benefit. If you work less than 16 hours and you’re looking for other work, you stand a good chance of getting Jobseeker’s Allowance. If you do get Jobseeker’s Allowance, you could get help with your mortgage through Income Support. Those over pension age could also get Pension Credits. Of course, each applicant is assessed on an individual basis, so don’t bank of getting these benefits.

National Insurance

As a self-employed person you are responsible for paying your own national insurance contributions. Self-employed workers normally pay Class 2 NICs, although some higher earners pay Class 4 NICs. Class 2 counts towards most of the benefits that salaries workers get from paying Class 1 NICs so Incapacity Benefit, Bereavement Benefits, contributory Employment and Support Allowance, Maternity Allowance and the State Retirement Pension are available to self-employed people. Check out hmrc.gov.uk for further information.

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