UK Government Self-employment and Universal Credit
Universal Credit is a monthly payment to help with your living costs. You may be able to get it if you’re on a low income or out of work.
Find out if you’re eligible for Universal Credit.
Providing information about your earnings
Everyone claiming Universal Credit needs to report their self-employed earnings at the end of each monthly assessment period. This includes company directors, even those paying themselves by PAYE.
You’ll need to report payments into and out of your business in the assessment period. This includes:
- total amount your business received
- how much your business spent on different types of expenses, such as travel costs, stock, equipment and tools, clothing and office costs
- how much tax and National Insurance you paid
- any money you paid into a pension
What type of work counts for Universal Credit
All work is taken into consideration for Universal Credit. If you’re expected to look for and be available for work, then it needs to be identified whether you’re ‘gainfully self-employed’.
Gainful self-employment means that:
- your main employment is self-employment
- you have self-employed earnings
- your work is organised, developed, regular and in expectation of profit
You must provide evidence about your business and earnings to your work coach, for example your:
- tax returns, accounts and any business plan
- Unique Taxpayer Reference (UTR), if you’re registered for Self Assessment
- customer and supplier lists, receipts and invoices
- marketing materials
If you’re gainfully self-employed you’re exempt from job search responsibilities and can concentrate on growing your business and earnings.
If you’re not gainfully self-employed, you’ll need to look for other work. You still have to report any earnings from your self-employment. You can ask to be reassessed in the future.
How your Universal Credit payment is worked out
If you’re gainfully self-employed, your Universal Credit payment may be calculated using an assumed level of earnings, called a Minimum Income Floor.
It’s based on what an employed person on minimum wage would expect to earn in similar circumstances.
If you earn more than this, then your Universal Credit amount is based on your actual earnings.
If you earn less, the Minimum Income Floor is used to work out how much you can get. You may need to look for additional work to top up your income.
If you want to know how coronavirus (COVID-19) affects the Minimum Income Floor, you can read the latest information about coronavirus and Universal Credit.
If you’re both self-employed and employed
Your Universal Credit payment will be worked out using your combined earnings or any applicable Minimum Income Floor, whichever is higher.
If you’re newly self-employed
If you’re within 12 months of starting your business, you may be eligible for a start up period of up to 12 months.
During your start up period your monthly earnings are used to work out your Universal Credit and the Minimum Income Floor doesn’t apply. You’ll also receive support from a work coach who’s trained to work with the self-employed.
You’ll need to attend quarterly appointments with your Work Coach, providing evidence to show that you’re still gainfully self-employed and actively taking steps to build your business.
You’re only entitled to one start up period, unless it has been more than 5 years since your previous one, and you’ve started a completely different type of self-employment.
Reporting changes in your circumstances
You’ll need to report any change in circumstances, for example if you:
- close your business
- start a different kind of business
- take a permanent job
- are no longer able to work
Depending on the change, your gainful self-employment may need to be reassessed.
In this section
- SCC Guidance for Businesses: Beyond Level 0, Face Coverings, Self-isolation
- Scottish Government Update - Friday 14th May
- Scottish Government Daily Update 24th March 2021
- BlueSky Experiences : COVID-19 As A Catalyst for Change Webinar 30 September
- Scottish Government SME Loan for food and drink businesses!
- URGENT update from NHS Tayside about a COVID-19 Outbreak at 2Sisters in Coupar Angus
- Waste sector grants offered for Covid-19 adaptations- Up to £10,000 per site
- Spain Quarantine Rules: An employment Law Insight
- General Guidelines
- UK government: Government launches £200m funding for sustainable COVID-19 Business Recovery, 27 June 2020
- Scottish Government: Lockdown begins to ease in Phase 1, 28 May 2020
- Scottish Government: COVID-19 Budget Revision, 27 May 2020
- Scottish Government: Sector Guidance for Easing Lockdown, 26 May 2020
- Scottish Government: COVID-19 Funding Plea, 23 May 2020
- Scottish Government: Expansion of COVID-19 Testing, 18 May 2020
- Data Protection and Privacy During the Coronavirus Pandemic
- Scottish Government: Second Coronavirus (Scotland) Bill, 11 May 2020
- Scottish Government: SME Support Doubles to £90 million, 8 May 2020
- Redundancy during Coronavirus Part 4: How do I calculate redundancy payments?
- Redundancy during Coronavirus: Part 3: How do I consult with employees who are risk of redundancy?
- Scottish Government: Emergency Loan Fund for SME House Builders, 7 May 2020
- UK Government: Business Rates Revaluation Postponed, 6 May 2020
- Scottish Government: New Powers over CAP, 5 May 2020
- Scottish Government: Preparing for Economic Recovery, 5 May 2020
- Uk Government: Self Employed Invited to Get Ready to Make Their Claims for COVID-19 Support, 4 May 2020
- UK Governement: Funding five new testing facilities in Scotland, including Perth, 29 April 2020
- Scottish Government: Rapid Coronavirus Research. More than 50 Scottish Studies to Tackle Virus and its Impact, 28 April 2020
- Scottish Government: Securing Vital COVID-19 Supplies for Scotland, 24 April 2020
- Coronavirus Business Interruption Loan Scheme Update and New Support for Smaller Businesses
- Aberdein Considine: View the latest response to Coronavarius
- Redundancy During Coronavirus: Part 2: How Do I Select Employees for Redundancy? 23 April 2020
- Scottish Government: Lifeline Support for Business Confirmed, 21 April 2020
- Scottish Government: Universal Credit. People Being Urged To Access All Support, 21 April 2020
- Scottish Government: COVID-19 Impact on Scotland's Economy, 21 April 2020
- Redundancy During Coronavirus: Part 1: How Do I Deal With Collective Consultation?, 21 April 2020
- Scottish Government: Call for Accelerated Business Support, 21 April 2020
- UK Government: Billion £ Support Package for Innovative Firms hit by COVID-19, 20 April 2020
- Scottish Government: Extend Brexit Transition during COVID-19 crisis, 20 April 2020
- Scottish Government: Advisory Group on Economic Recovery, 17 April 2020
- Scottish Government: Thousands of Businesses Benefit from Support Grants, 17 April 2020
- UK Government: Chancellor extends furlough scheme to end of June, 17 April 2020
- What Coronavirus Act means for Commerical Landlords
- UK Government: Universal Credit claimants to verify identity through Government Gateway, 16 April 2020
- UK Government: Councils given greater financial relief against cash flow pressures, 16 April 2020
- Scottish Government: Additional Support for Business, including additional £100m for Self-Employed, 15 April 2020
- UK Government: Magnox donates 66,000 items of PPE to support coronavirus response, 15 April 2020
- UK Government: Furlough scheme cut-off date extended to 19 March, 15 April 2020
- UK Government: Job Retention Scheme, 15 April 2020
- Scottish Government: New Mental Health Support, 14 April 2020
- UK Government Response: Commission on Human Medicines: Advice on Ibuprofen and Coronavirus, 14 April 2020
- Scottish Government: National Helpline to Support Those at High COVID-19 Risk, 13 April 2020
- UK Government: Scottish Secretary Welcomes Additional Money to Help Scotland Tackle Coronavirus, 13 April 2020
- Scottish Government: Transport Community to Help COVID-19 Sufferers, 12 April 2020
- Scottish Government: New Measures to Protect Business Tenants, 10 April 2020.
- Scottish Chamber of Commerce: COVID-19 Update
- Scottish Government: Skills matching service to help rural business. 09.04.20
- Scottish Government: Additional COVID-19 Daily Data Published 08.04.20
- UK Government: Coronavirus (COVID-19): letter to the manufacturing sector 08.04.20
- UK Government: Letter from the Secretary of State for Business, Energy and Industrial Strategy, Alok Sharma, to those working in retail. 08.04.20
- Scottish Business Community calls for clarity, consistency and cooperation in COVID-19 response 3 April 2020
- Help find new ways too ease global disruption: apply for funding. 3 April 2020
- UK Export Finance to offer export insurance in all major markets in response to Coronavirus (COVID-19). 3 April 2020
- Chancellor strengthens support on offer for business as first government-backed loans reach firms in need
- Scottish Business Community calls for clarity, consistency and cooperation in COVID-19 response. 3 April 2020
- Scottish Govenment Help with non-domestic rates in Scotland during coronavirus (COVID-19) Last updated: 2 April 2020
- Coronavirus: Rishi Sunak announcement on UK government aid for self-employed
- UK Government Self-employment and Universal Credit
- Scottish Government Coronavirus (COVID-19): business and social distancing guidance. Published 25.03.20
- Scottish Government Coronavirus (COVID-19): guidance for businesses on offering support. Published 24 March 2020
- 20th March Update
- SCC & Scottish Government Update 18th March
- SCC & Scottish Government Update 17th March
- PKC Coronavirus (Covid-19) Guidance
- UK Government Coronavirus (Covid-19) Link
- Scottish Government Corona Virus (Covid-19) Link
- NEW Find Business Support in response to Coronavirus - from Scottish Enterprise Source
- Coronavirus: £320m rescue package for business from Scottish government - BBC Sourced
- Guidance & Quick Links
- Helpline announed by Fiona Hyslop, Economy Secretary - Sunday 15th March 2020