4th Mar 2025
Studying Time: 11 minutes
Article up to date 4th March 2025
Do you know there’s assist for the newly self-employed? Even at this troublesome time, there are nonetheless many sources of monetary and enterprise assist you’ll be able to entry.
You is likely to be caught in a dead-end workplace job and determined to get away from the nine-to-five. Or, you is likely to be in an trade the place individuals are dropping their jobs at a speedy tempo and wish to arrange a enterprise to have one thing to do on the facet and increase in the event you lose your important job. Some individuals wish to be self-employed as a result of they like the pliability of the hours and management of the work, too. Nonetheless, establishing can require funding – particularly as most companies don’t flip a revenue of their first few months (and even years). The excellent news is that there’s assist on the market.
So, what assist is obtainable for the newly self-employed?
There’s rather a lot to get by way of, so let’s get began!
Common Credit score and Self Employment
Common Credit score is a versatile profit. You don’t should be out of labor to entry it. If you’re self-employed, you’ll submit a month-to-month evaluation of your revenue and bills.
When your internet revenue is under a certain quantity (relying in your circumstances), you’ll obtain some or all of your Common Credit score fee. The months you earn extra, you’ll obtain much less or no Common Credit score.
This implies you’ll be able to proceed to be a UC recipient till your small business returns a stable revenue each month. In contrast to Job Seeker’s Allowance, which stops as quickly as you discover work, UC is an ongoing security internet.
You have to to show that you’re ‘gainfully self employed’. Because of this:
- Your job is your solely or important revenue
- You’ve gotten common work
- You’ll be able to present enterprise exercise, equivalent to consumer invoices
There’s something referred to as the Minimal Earnings Flooring. This varies from individual to individual, and relies upon what somebody on PAYE in the same function to yours would earn at Nationwide Minimal Wage. If you happen to earn over this quantity, your Common Credit score is labored out based mostly on what you’ve earned over this flooring (so deductions are constructed from your earnings to the extent of the MIF). If you happen to don’t meet the MIF, your Common Credit score deductions are based mostly on what the MIF can be. The MIF solely applies in case you are not in a start-up interval (see under) or you’re gainfully self employed. If you’re not gainfully self employed (for instance, you will have a important PAYE job and a small self-employed job on the facet), the MIF received’t apply.
If you happen to’re simply beginning out, you will have one yr through the launch of your small business to get Common Credit score assist and not using a MIF utilized. You don’t should search for different work, although you’ll meet along with your work coach recurrently. Your Common Credit score relies in your month-to-month revenue – and losses (equivalent to a month the place your bills outweigh your revenue) are rolled to the next month. You’ll report your month-to-month revenue and bills, so keep in mind that your revenue might scale back how a lot UC you’ll get that month.
Common Credit score eligibility
There are some limits to accessing UC.
You will need to:
- Have lower than £16,000 in capital or belongings
- Not personal a second property
- Apply collectively along with your accomplice in the event you stay collectively.
This implies in case your accomplice earns above a certain quantity, you received’t be eligible for Common Credit score. You don’t should be married – in the event you stay along with your accomplice, their revenue is taken into consideration.
Common Credit score, Self Employment, and Incapacity
Self employed individuals who declare Common Credit score however have a psychological or bodily incapacity which impacts their capacity to work full-time will be capable to apply for a Work Functionality Evaluation. You can be assessed to resolve in case your well being impacts your self employment alternatives, and could possibly be positioned in one in every of two teams for additional monetary assist whether it is deemed your well being places you at a drawback to discovering work. You’ll both be within the Restricted Functionality to Work group or the Restricted Functionality for Work and Work-Associated Exercise group – the previous has some extra monetary assist, the latter has extra (how a lot is dependent upon your circumstances).
If you’re discovered to be in these teams, different exceptions might apply – equivalent to eradicating the requirement to fulfill the Minimal Earnings Flooring after a start-up interval.
Assist to Save
If you happen to do qualify for Common Credit score, you’ll be able to plan to open a Assist to Save account, too. The good information is that the foundations are altering in April 2025 – beforehand, you needed to earn a minimal of £793.17 in a single month to qualify to open one. Nonetheless, from April, you solely must earn £1 in a single month as earnings to be eligible.
Assist to Save is a helpful financial savings account with a hefty authorities bonus. Save between £1 and £50 every month, and the federal government pays you a bonus price 50% of the best stability you’ve saved.
The account lasts for 4 years, and the bonus is paid to you in yr 2 and yr 4. The utmost bonus you’ll be able to obtain is £1,200 (£600 in each yr 2 and yr 4). After the fourth yr, it robotically closes and you’ll’t open one other one.
This more money – and financial savings behavior – is a good way to be sure you’re setting apart some cash on your tax payments. Issues like Funds on Account can take newly self-employed individuals abruptly, so an emergency buffer like this helps.
Learn our in-depth Assist to Save article to search out out extra.
Entry to Work
A bit of-known useful resource, Entry to Work helps individuals with psychological or bodily disabilities get the correct tools or assist to do their job effectively.
Employers can entry the scheme to obtain a portion of prices for particular tools. Self-employed individuals, nevertheless, can use the scheme to have most or the entire value coated.
The grant covers issues like desk tools or speech-to-text software program. It may well additionally cowl issues like assisted journey to and from a office, or assist employee companies. You may as well get assist with work assist equivalent to ADHD counselling and work coaches, to assist enhance your productiveness and discover methods to manage in work environments.
Entry to Work shouldn’t be taxed and doesn’t should be paid again. If you’re receiving a one-off grant, equivalent to to pay for a standing desk, it’s possible you’ll be required to pay this and declare it again from Entry to Work.
The best way to apply
To be eligible, you will need to have a incapacity (a power bodily or psychological situation that impacts your day-to-day duties and can final a minimal of 9 months). You don’t should obtain incapacity advantages to qualify. You’ll additionally must be in paid work (together with self-employment) or as a consequence of begin paid work imminently.
First, apply on-line for an Entry to Work grant. There’s a barely completely different scheme to use for in the event you stay in Northern Eire.
You’ll be requested about your well being situation, the way it impacts your capacity to work, and what tools you might want to assist.
Subsequent, somebody will come to evaluate your wants both at your workplace or house (in the event you’re working from house). If, for instance, you want a particular desk chair, they’ll measure you for this on the identical time. Chances are you’ll not require an evaluation to obtain your grant – or your grant could possibly be delayed till assessments can be found once more.
In case your grant is accepted, you’ll obtain the report together with details about the tools and provider. You’ll be able to then order that tools from the provider – and both pay direct and be reimbursed, or have Entry to Work pay the provider direct.
If you happen to make money working from home, you’ll have to pay a portion of the associated fee if the tools could possibly be used for private use, equivalent to you probably have obtained a grant for a pc or tailored tools that’s helpful each on your job and day-to-day actions.
Private Independence Fee (PIP)
Private Independence Fee shouldn’t be means examined, which implies you’ll be able to apply whether or not you’re in work or not and no matter how a lot you (or your accomplice) earn. It’s designed to assist individuals address the additional prices that include having a incapacity. This is likely to be hiring assist staff, getting taxis in the event you can’t drive or stroll with ease, and even issues like getting a cleaner as soon as per week so you’ll be able to focus your power on work-related exercise as an alternative.
You’ll be able to spend your PIP on no matter you might want to, so as to make your life a bit simpler dwelling and dealing with a incapacity.
There are two elements to PIP, and a decrease and better fee for every. You would possibly qualify for one or each, at whichever fee an assessor deems appropriate. The Day by day Dwelling part is £72.65 for the decrease fee or £108.55 for the upper fee every week within the 2024/5 tax yr. The Mobility part is £28.70 decrease fee or £75.75 for the upper. Qualifying for one part doesn’t essentially qualify you for the opposite.
Discover out extra and easy methods to apply right here.
Enterprise Mentorship
Not strictly a funding alternative or a profit, however enterprise mentorship programmes are an incredible place to begin whenever you arrange your small business.
Your native Job Centre and your Residents Recommendation Bureau could have loads of recommendation about accessing native enterprise mentorship schemes.
Getting a neighborhood enterprise mentor means you’ll have entry to vital networking alternatives. They’ll additionally know the place you could possibly entry grants and funding on a neighborhood degree, too.
Some native authorities run a enterprise mentorship programme with numerous free workshops to teach new enterprise house owners on the whole lot from advertising and marketing to managing taxes. You may additionally be capable to entry free (or very low-cost) co-working workplace house, tools, or storage items for stock.
Prince of Wales Belief
The Prince of Wales Belief affords enterprise mentorship and funding assist to entrepreneurs aged 18 to 30, inclusive – so in the event you’re already 30 you’ll be able to apply.
The Belief has a superb popularity for serving to younger individuals launch their careers. Its group affords mentorship and assist, from enterprise planning by way of to funding functions and past. You may as well entry the Growth Awards for some coaching grants, too.
Have a look across the web site to see in the event that they may help.
Startup Funding
If you can begin your small business with out borrowing, that’s an incredible place to be in. Nonetheless, most new enterprise house owners might want to borrow some capital to get their enterprise off the bottom.
Startup loans provide a low-cost approach to fund your new enterprise plans. You don’t want the identical established enterprise necessities of a typical enterprise mortgage, both. For instance, you don’t should have a number of years’ accounts to be permitted for a mortgage.
Store round on your startup mortgage. Like another mortgage, some offers are higher than others. Borrow solely what you want – not the utmost quantity accessible. This helps retains prices down within the long-term with out impacting your short-term money circulate.
Attempt the Startup Loans Firm or Funding Circle as a primary cease.
Peer-to-peer Lending and ‘Angel Traders’
A so-called ‘angel investor’ is sort of a dragon from the Dragons’ Den. They’ll fund a part of your small business enterprise in return for a share of the income. You’ll usually obtain enterprise mentorship as a part of the deal, too.
There are many angel investor platforms accessible. Attempt to meet with (or, nowadays, video-call) potential buyers earlier than signing something. At all times learn the small print and be sure you converse to a number of attainable buyers earlier than selecting your accomplice.
Peer-to-peer (P2P) lending is a little more nameless. You don’t get the enterprise mentorship however you’ll be able to entry a bigger fund.
Traders pay right into a P2P fund in return for a share on their cash. The P2P platform takes a share, too. Consider it like a mortgage – however with out the necessity to fulfill excessive lending necessities of a excessive road financial institution.
Crowdfunding
We’ve all seen the success of Kickstarter and Crowdfunder. However how do they work?
You create an internet pitch for anybody to see. This contains particulars concerning the merchandise you wish to develop, what it does, and what the crowdfunded cash pays for. You’ll be able to entice buyers by giving them one thing in return for his or her money. For instance, they’ll purchase the product early and at a decreased value, or you’ll be able to provide them an inventory on a sponsors web page – something you assume will entice buyers.
It’s important to set a goal. Examine the main points of every fundraising platform and sort – some will stipulate that in the event you don’t hit the goal you received’t get any of the pledged money, whereas others will allow you to obtain no matter is raised.
If you happen to do attain your funding goal, then again, you’re going to get your cash. You’ll must maintain correct accounts to point out that you’ve got executed with the cash what you mentioned you’ll, and be sure you honour any pledges (equivalent to receiving a product in return for being an early supporter of your new product).
Native Authority Funding
Examine your native council’s enterprise pages to see what help it affords. You is likely to be shocked!
Many native authorities provide funding or mentorship programmes for brand new enterprise house owners. These schemes are sometimes extra prevalent in disadvantaged areas, to encourage new corporations to arrange in that area.
The funding accessible could possibly be something from a one-off grant to ongoing enterprise assist within the type of a rent-free workplace or store house. Many grants must be matched – so in the event you want £1,000, you’ll must put £500 up your self and ask for an additional £500 within the grant.
You may as well take a look at Turn2Us Grant Finder which takes you thru a questionnaire that can assist you find grants on your private circumstances (reasonably than to assist your small business), which may help alleviate among the monetary stress of going self-employed.
Social Enterprise Funding
If you’d like your new enterprise to be a social enterprise, this opens you as much as many extra funding alternatives.
A social enterprise places surplus income again into the enterprise to help the neighborhood. You’ll be able to nonetheless earn a revenue and wage, however your total work must have a social or environmental mission that advantages your area people and surrounding areas.
Working a enterprise like that is just like another enterprise mannequin. Nonetheless, as an alternative of sharing income within the type of dividends to shareholders, you set that cash again into your small business efforts to maximise your impression on the neighborhood.
Social enterprises qualify for all kinds of grants, together with these supplied by the Nationwide Lottery Group Fund.
Loans can be found as a funding choice, usually with a share grant. This implies you received’t should pay again the whole lot that’s borrowed, solely the mortgage ingredient. For instance, the First Steps Enterprise Fund affords loans as much as £30,000 – with 90% of that as a mortgage and 10% a grant.
Coaching Grants
If you might want to obtain a qualification earlier than you’ll be able to open your small business, it’s possible you’ll obtain coaching funding to assist.
For instance, individuals on Common Credit score might apply to have some or all charges paid for, in the event that they enrol on a brief skilled improvement course. The course must be an important merchandise – for instance, your Fuel Secure certification if you wish to begin a boiler engineer enterprise. It might additionally embody issues like well being and security coaching for cell magnificence therapists, licence programs for safety workers, or a PTTLS grownup instructing qualification for tutors and workshop leaders.
The Nationwide Careers Service has some funding alternatives for programs, too.
If you happen to’re on a low revenue, it’s additionally price taking a look at your native grownup training centres and programs. They’ll usually provide free or discounted locations to individuals on advantages or who can show a low revenue.
Have a look at charities centred round your trade of selection, too. Screenskills, for instance, affords bursaries and coaching alternatives for every kind of individuals eager to work behind the scenes in tv and movie.
Apprenticeship Funding
Do you wish to arrange a enterprise with workers? If you happen to’re not planning to go it solo as a freelancer or contractor, staffing prices will make up an enormous overhead as you arrange your organization.
Apprenticeships provide a approach to workers your organization whereas coaching the brand new technology. New companies should fund 5% of apprenticeship prices, with the remainder coated by a Authorities scheme.
You’ll must comply with the foundations about working hours, and time without work for examine and exams, and help with mentoring your apprentice.
Your apprentices might turn out to be full-time workers as soon as they cross their course just a few years down the road, too!