What is Universal Credit start-up period?

Job search

Until your work coach decides you are gainfully self-employed, your claimant commitment applies: usually up to 35 hours a week of job search.

Your business work can count. Ask for your business-plan hours to be agreed as “work preparation”. They come off the 35.

What you must do to keep getting it

• Bring evidence to your Gateway Interview: business name and start date, UTR, invoices and receipts, bank statements, website or social media, business plan. A new business with no income yet can pass if it is organised, regular and aimed at profit.
• Report self-employed income and expenses every assessment period, even if it’s nothing.
• You get one start-up period (another only after 5 years, for a different trade), so time it for when you’re ready to go.

If you take or turn down a job: Refusing a job offer is a 91-day sanction (182 for a repeat). Only apply for jobs you would take.

Job search

In your 12-month start-up period you don’t have to look for, or be available for, other work. You do have to take active steps to grow the business.

What you must do to keep getting it

• Go to your Self-employment Review every 3 months. Missing it can be sanctioned or end the start-up period early.
• Report income and expenses at the end of every assessment period, on a cash basis. Flat rates: 45p a mile (first 833 miles), use of home £10 / £18 / £26 by hours.
• Log your active steps: marketing, networking, funding, courses. The work coach checks them.
• From month 13 the minimum income floor applies. Aim your profit at it now.
• Keep business money in a business account: business assets don’t count towards the £16,000 limit, personal savings do.

If you earn money

Your real monthly profit is used, and Universal Credit goes down 55p for each £1 over any work allowance. There is no minimum income floor for these 12 months. From month 13 the floor applies: Universal Credit is worked out as if you earn at least 35 hours a week at the National Living Wage, after tax (about £1,700 a month at 21+), even if you earn less.

If you take or turn down a job: You can take a job; report the earnings. If a job becomes your main work, you’ll have a new Gateway Interview and may lose self-employed status.