Annie
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 tough time, there are nonetheless many sources of economic and enterprise assist you possibly can entry.
You may be caught in a dead-end workplace job and determined to get away from the nine-to-five. Or, you may be in an business the place persons are shedding their jobs at a speedy tempo and wish to arrange a enterprise to have one thing to do on the facet and develop in case you lose your primary job. Some folks wish to be self-employed as a result of they like the flexibleness 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 quite a bit to get via, 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 earnings and bills.
When your web revenue is beneath 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 possibly can proceed to be a UC recipient till your online business returns a stable earnings each month. In contrast to Job Seeker’s Allowance, which stops as quickly as you discover work, UC is an ongoing security web.
You’ll need to show that you’re ‘gainfully self employed’. Which means that:
Your job is your solely or primary earnings
You may have common work
You’ll be able to present enterprise exercise, similar to shopper invoices
There’s something referred to as the Minimal Revenue Ground. This varies from individual to individual, and relies upon what somebody on PAYE in an analogous position to yours would earn at Nationwide Minimal Wage. For those who earn over this quantity, your Common Credit score is labored out primarily based on what you’ve earned over this flooring (so deductions are comprised of your earnings to the extent of the MIF). For those who don’t meet the MIF, your Common Credit score deductions are primarily based on what the MIF could be. The MIF solely applies in case you are not in a start-up interval (see beneath) or you’re gainfully self employed. In case you are not gainfully self employed (for instance, you have got a primary PAYE job and a small self-employed job on the facet), the MIF received’t apply.
For those who’re simply beginning out, you have got one 12 months throughout the launch of your online business to get Common Credit score assist with out a MIF utilized. You don’t should search for different work, although you’ll meet together with your work coach usually. Your Common Credit score relies in your month-to-month earnings – and losses (similar to a month the place your bills outweigh your earnings) are rolled to the next month. You’ll report your month-to-month earnings and bills, so keep in mind that your earnings may cut back how a lot UC you’ll get that month.
Common Credit score eligibility
There are some limits to accessing UC.
You could:
Have lower than £16,000 in capital or property
Not personal a second property
Apply collectively together with your associate in case you stay collectively.
This implies in case your associate earns above a certain quantity, you received’t be eligible for Common Credit score. You don’t should be married – in case you stay together with your associate, their earnings 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’ll be assessed to determine in case your well being impacts your self employment alternatives, and might be positioned in one in every of two teams for additional monetary assist whether it is deemed your well being places you at an obstacle 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 will depend on your circumstances).
In case you are discovered to be in these teams, different exceptions might apply – similar to eradicating the requirement to satisfy the Minimal Revenue Ground after a start-up interval.
Assist to Save
For those who do qualify for Common Credit score, you possibly can plan to open a Assist to Save account, too. The good information is that the principles 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 value 50% of the very best steadiness you’ve saved.
The account lasts for 4 years, and the bonus is paid to you in 12 months 2 and 12 months 4. The utmost bonus you possibly can obtain is £1,200 (£600 in each 12 months 2 and 12 months 4). After the fourth 12 months, it robotically closes and you’ll’t open one other one.
This more money – and financial savings behavior – is an effective way to be sure you’re setting apart some cash on your tax payments. Issues like Funds on Account can take newly self-employed folks abruptly, so an emergency buffer like this helps.
Learn our in-depth Assist to Save article to seek out out extra.
Entry to Work
A little bit-known useful resource, Entry to Work helps folks with psychological or bodily disabilities get the best tools or assist to do their job nicely.
Employers can entry the scheme to obtain a portion of prices for particular tools. Self-employed folks, nevertheless, can use the scheme to have most or the entire value lined.
The grant covers issues like desk tools or speech-to-text software program. It could actually additionally cowl issues like assisted journey to and from a office, or assist employee companies. You too can get assist with work assist similar to ADHD counselling and work coaches, to assist enhance your productiveness and discover methods to manage in work environments.
Entry to Work just isn’t taxed and doesn’t should be paid again. In case you are receiving a one-off grant, similar to to pay for a standing desk, chances are you’ll be required to pay this and declare it again from Entry to Work.
The way to apply
To be eligible, you will need to have a incapacity (a persistent 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 should be in paid work (together with self-employment) or as a result of begin paid work imminently.
First, apply on-line for an Entry to Work grant. There’s a barely totally different scheme to use for in case 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 it’s worthwhile to assist.
Subsequent, somebody will come to evaluate your wants both at your workplace or house (in case you’re working from house). If, for instance, you want a particular desk chair, they’ll measure you for this on the similar time. You could not require an evaluation to obtain your grant – or your grant might 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.
For those who work at home, you will have to pay a portion of the fee if the tools might be used for private use, similar to when you have acquired 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 just isn’t means examined, which implies you possibly can apply whether or not you’re in work or not and no matter how a lot you (or your associate) earn. It’s designed to assist folks deal with the additional prices that include having a incapacity. This may be hiring assist staff, getting taxis in case you can’t drive or stroll with ease, and even issues like getting a cleaner as soon as per week so you possibly can focus your vitality on work-related exercise as an alternative.
You’ll be able to spend your PIP on no matter it’s worthwhile to, with the intention to make your life a bit simpler residing and dealing with a incapacity.
There are two elements to PIP, and a decrease and better fee for every. You may qualify for one or each, at whichever fee an assessor deems appropriate. The Each day Residing element is £72.65 for the decrease fee or £108.55 for the upper fee every week within the 2024/5 tax 12 months. The Mobility element is £28.70 decrease fee or £75.75 for the upper. Qualifying for one element doesn’t essentially qualify you for the opposite.
Discover out extra and apply right here.
Enterprise Mentorship
Not strictly a funding alternative or a profit, however enterprise mentorship programmes are a fantastic place to start out whenever you arrange your online business.
Your native Job Centre and your Residents Recommendation Bureau may have loads of recommendation about accessing native enterprise mentorship schemes.
Getting an area enterprise mentor means you’ll have entry to necessary networking alternatives. They’ll additionally know the place you could possibly entry grants and funding on an area stage, too.
Some native authorities run a enterprise mentorship programme with a lot of free workshops to teach new enterprise homeowners on every thing from advertising to managing taxes. You may additionally be capable to entry free (or very low-cost) co-working workplace area, tools, or storage models 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 case you’re already 30 you possibly can apply.
The Belief has a wonderful popularity for serving to younger folks launch their careers. Its crew affords mentorship and assist, from enterprise planning via to funding purposes and past. You too can entry the Improvement Awards for some coaching grants, too.
Have a look across the web site to see in the event that they will help.
Startup Funding
If you can begin your online business with out borrowing, that’s a fantastic place to be in. Nonetheless, most new enterprise homeowners might want to borrow some capital to get their enterprise off the bottom.
Startup loans supply a low-cost strategy 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 authorized 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 obtainable. This helps retains prices down within the long-term with out impacting your short-term money circulation.
Attempt the Startup Loans Firm or Funding Circle as a primary cease.
Peer-to-peer Lending and ‘Angel Buyers’
A so-called ‘angel investor’ is sort of a dragon from the Dragons’ Den. They’ll fund a part of your online business enterprise in return for a share of the earnings. You’ll typically obtain enterprise mentorship as a part of the deal, too.
There are many angel investor platforms obtainable. Attempt to meet with (or, today, video-call) potential traders earlier than signing something. At all times learn the small print and be sure you converse to a number of potential traders earlier than selecting your associate.
Peer-to-peer (P2P) lending is a little more nameless. You don’t get the enterprise mentorship however you possibly can entry a bigger fund.
Buyers 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 avenue financial institution.
Crowdfunding
We’ve all seen the success of Kickstarter and Crowdfunder. However how do they work?
You create a web-based pitch for anybody to see. This consists of particulars in regards to the merchandise you wish to develop, what it does, and what the crowdfunded cash pays for. You’ll be able to entice traders by giving them one thing in return for his or her money. For instance, they’ll purchase the product early and at a diminished worth, or you possibly can supply them a list on a sponsors web page – something you suppose will entice traders.
It’s a must to set a goal. Examine the small print of every fundraising platform and sort – some will stipulate that in case 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.
For those who do attain your funding goal, however, you’re going to get your cash. You’ll must hold correct accounts to indicate that you’ve got achieved with the cash what you stated you’d, and be sure you honour any pledges (similar 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 may be shocked!
Many native authorities supply funding or mentorship programmes for brand new enterprise homeowners. These schemes are sometimes extra prevalent in disadvantaged areas, to encourage new firms to arrange in that area.
The funding obtainable might be something from a one-off grant to ongoing enterprise assist within the type of a rent-free workplace or store area. Many grants should be matched – so in case you want £1,000, you’ll must put £500 up your self and ask for an extra £500 within the grant.
You too can take a look at Turn2Us Grant Finder which takes you thru a questionnaire that can assist you find grants on your private circumstances (somewhat than to assist your online business), which will help alleviate a number of 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 earnings again into the enterprise to assist 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 local people and surrounding areas.
Operating a enterprise like that is just like another enterprise mannequin. Nonetheless, as an alternative of sharing earnings within the type of dividends to shareholders, you set that cash again into your online business efforts to maximise your affect on the neighborhood.
Social enterprises qualify for all kinds of grants, together with these supplied by the Nationwide Lottery Neighborhood Fund.
Loans can be found as a funding possibility, typically with a share grant. This implies you received’t should pay again every thing that’s borrowed, solely the mortgage component. 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 it’s worthwhile to obtain a qualification earlier than you possibly can open your online business, chances are you’ll obtain coaching funding to assist.
For instance, folks 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 Gasoline Secure certification if you wish to begin a boiler engineer enterprise. It may additionally embody issues like well being and security coaching for cellular 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.
For those who’re on a low earnings, it’s additionally value your native grownup training centres and programs. They’ll typically supply free or discounted locations to folks on advantages or who can show a low earnings.
Have a look at charities centred round your business of alternative, 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? For those who’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 supply a strategy to workers your organization whereas coaching the brand new technology. New companies should fund 5% of apprenticeship prices, with the remaining lined by a Authorities scheme.
You’ll must comply with the principles about working hours, and day off for examine and exams, and help with mentoring your apprentice.
Your apprentices may change into full-time workers as soon as they cross their course a number of years down the road, too!