Housing Benefit for self-employed claimants

Self-employed people are those workers who are not employed under a contract. Typically, they can include trades such as window cleaners, certain taxi drivers, painters and decorators.

A person can be self-employed as a sole trader or as part of a business partnership.

Universal Credit from 6 September 2017

From 6 September 2017 we will no longer be able to accept new claims for Housing Benefit unless you:

  • are of pensionable age
  • have more than two children 
  • are in exempt accommodation.

If you don't fall into one of these categories, you will need to make a claim for Universal Credit for help with your housing costs.

If you are self-employed and you fall into one of these categories, you will need to complete a Housing Benefit claim form and a self-employed certificate of earnings form.

Information requirements for self-employed claimants

If you have recently started trading on a self-employed basis, we will ask for an estimate of the likely income and expenses for the business over the first few months trading. This will help us to pay your Housing Benefit sooner rather than having to wait until you have been trading for a few months.

If you have been trading for over 12 months, we will ask for a full years trading figures - normally in the way of a profit and loss account. We may also ask for the most recent tax assessment form received from HM Revenues and Customs.

You will also need to complete a self-employed certificate of earnings form.

What is your total income for Housing Benefit purposes?

You need to provide details of all the income of the business as well as any other money coming into your household. This includes interest from business bank accounts, tips and royalties. We will advise you whether or not this money is counted for Housing Benefit purposes.

Which expenses are then taken off this income?

You must provide details of all of your expenses. Only expenses that are 'wholly and exclusively' incurred in relation to the business can be allowed for Housing Benefit purposes.

Please note that the rules about expenses allowed for Housing Benefit purposes are different to those for Income Tax purposes. For example, depreciation and business entertainment expenses are not taken into account in the assessment of your Housing Benefit.

Self-employed childminders

Childminders are treated differently. Instead of working out what their actual expenses are, two thirds of their total income is disregarded. The remaining third becomes their 'business income' for Housing Benefit purposes.

Business partnerships

If you are employed in a partnership, the pre-tax profit for the business (gross income minus expenses) is divided equally between the number of partners. If there is a formal agreement in the partnership which governs that profit should be treated differently, then this will take priority.

Tax and National Insurance

After the net profit of the business is worked out we will make an assessment of Income Tax and National Insurance contributions. These figures may differ from the figures worked out by HM Revenue and Customs.

Private pensions

Please supply proof of any contributions you may make into a personal or private pension. Half of any contribution that you make will not be counted as part of your income for Housing Benefit purposes.