From comfortably off to benefits overnight - I can’t believe this is happening to us

[greatbighillofhope]

My husband and I own and run a business together which has closed due to corona. We have overheads that still must be paid and also suppliers to pay. We could never foresee a scenario where we would be unable to trade other than fire or flood. Even in the case of illness/death we could still trade as we employ staff who could keep it going for periods without either of us. Regardless, we have insurance cover for all those eventualities.
Because we cannot trade now our rainy day savings are more than wiped out paying our continuing overheads and suppliers. We have gone from being entirely secure with a good income to having absolutely nothing overnight.
We have been 26 years in business, we have declared every penny of income and paid every tax in full and on time.
Thanks to Rishi Sunak’s bizarrely unfair self employed support scheme our family can claim nothing. I feel so let down, left behind and forgotten about.
It is incredibly unfair that someone whose business has been only mildly affected may still be eligible, can now claim 80% and also continue to trade. Why do we get nothing In this scheme when we have nothing to live on?
I have put in an online claim for universal support. I think our family could be eligible for around £500 per month (including carers allowance as our son has special needs). it won’t cover our expenses as our lifestyle is based on a much higher income. We can cut down on many things of course but It won’t even cover our fixed costs.
But, I cannot get through by phone to UC to book a telephone appointment. I tried all day yesterday, but the line keeps cutting off. at one point I had been on hold for 1.5 hours before it just cut me off. What else can we do?

Oh and people it's profit, which in my DH case is let's say he buys a microwave for £20, sells it for £40 and spends £5 fixing it. His profit is worked out gross and net, the government is talking about gross profit. So in this case it would be £40, as his net is £15... But they are going by the profit in total not the expenses laid out to get that end profit total. As a lot of you seem to think OP & OPDH are earning over 50k when this is not the case in all these circumstances.

Odessa- Esa is for people too sick to work.

Can you get a Mortgage holiday for a few months? Are some of your outgoings reducing because of Coronavirus?

For all you people who have been living the high life and are now having to claim UC,perhaps now you wont be quite as quick to look down your noses at people who are already on UC and JSA,and telling them to get a job.Remember its the Tories who have actioned this,you cold have had a caring Labour Govt who would have helped EVERYONE.You reap what you sow as they say!!!

26 years of trading and no contingency? After just a few weeks of shutdown all of your savings are gone already? Sounds like it was barely a subsistence business.

I’m shocked by some of the attitudes on this. There’s not one thing to suggest the op looks down her at other people. What awful inverse snobbery.

The government wants people to run businesses and provide jobs to other people. With that comes a lot of expense and a lot of stress.

Also, her savings are gone because she has fulfilled her obligations to her employees and paid them their salary out of that. Depending on the size of the business this could be in the 10s of thousands of pounds in each month. Even five employees full time on minimum wage would be the best part of £10k per month. Rent as well could easily be thousands of tens of thousands a month. Even if she was insured for a pandemic like this, as the government has stopped short of telling everyone they must stop work, it is likely the insurance wouldn’t pay out.

Op, I work for myself as a copywriter, PR and digital marketing specialist. If you would like any ideas for increasing your sales online, please drop me a message and I’d be happy to help (without charge). We all have to pull together now. My work has sadly reduced but out the other side I hope things will pick up again. If there’s anything I can do to help someone struggling at this time I gladly would.

26 years of trading and no contingency? After just a few weeks of shutdown all of your savings are gone already? Sounds like it was barely a subsistence business

Unhelpful comment of the year.

OP, please write to your MP to complain and make loads of noise. Also approach your bank for help as well. I thought part of the chancellors package was business loans as well?

26 years of trading and no contingency? After just a few weeks of shutdown all of your savings are gone already? Sounds like it was barely a subsistence business.

Shock horror! the majority of small business aren't making vast sums of money, they are just ticking over.

First off regards UC and being able to book an appointment to sort out your first interview etc

The main helpline is extremely busy up to 12 hour wait some days. But you would be classed as a vulnerable household because you have a child with disabilities. So you are one of the few who can call the local jobcentre direct explain you have disabilities in household they will arrange with you direct to sort your appointment. I am a welfare rights manager and this Info came direct from DWP. You may still be on hold to your local jobcentre but will have a better chance of getting through successfully.

Regards the self employed support scheme you should be able to claim as employers for the staff salaries as stated under the job retention scheme. It’s confusing depending on what status you have for yourselves either PAYE then even if self employed if you’re this route it is job retention scheme. Only those who are earning more than fifty per cent of their earnings from self employment and are profit only based are the self employed income support scheme.

Martin Lewis did a really good piece on his tv show last week on self employment support. He mentioned people trading under 12 months not being eligible but that they should try apply anyway. I know you and DP are partners in business but I would apply both of you separate and challenge the fact that if you were both self employed separately you would qualify. The problem is they have had to rush through legislation very quickly to try and support people. They have had to start somewhere and in doing so lots of groups within self employed missed out. The only way to address that is challenging.

Sorry can’t be particularly sympathetic, as you say you have lived comfortably for years. Having your own company has risks.
Thousands of people have lived on the breadline for years often through no fault of their own.

OP have you heard of ESA?

Are you kidding? ESA is for those too sick to work, which OP and her DH clearly aren’t. It’s hard enough to get when you are legitimately sick.

And as for the people banging on about dividends

Sorry, hit post too soon

OP doesn’t take dividends as they’re a self employed partnership. And dividends are not taxed less than PAYE income anyway,

Anything you take as dividends has already had corporation tax paid (19%). That’s on all profits (so after salaries are paid). The first £2k of dividends then have no further tax, and after that its 7.5% additional tax. Once you’re taking more than about £32k dividends that shoots up to 30 something per cent.

Sorry can’t be particularly sympathetic

That's nice of you 😞

Sorry to hear about your business and welcome to how the other half lives☹️

Sorry to hear about your business and welcome to how the other half lives

Appalled to see so many people enjoying the suffering of others. Would this sort of comment be made to people who’d been laid off, become sick or disabled etc? It’s just vile.

There are some awful comments on here. The OP sounds perfectly lovely, somebody who has worked hard to build a business, employed others, generally done the right thing, paid staff wages from her savings.

It’s worth remembering that this lady’s taxes have contributed massively to paying benefits for ‘the other half.’ The more you earn, the greater your contribution in taxes. The fact that she now finds herself in this head spin is heartbreaking and undeserved. Our household tax bill is about £27k per year. Every year. That’s money we’ve earned and we give back. I’ve never claimed benefits in the 30 years I’ve been working. Think about that for a minute and determine whether you might ever have benefited from other people’s taxes before you make such shitty comments.

@Deathgrip It doesn't surprise me to be honest. This crisis has really brought out the worst in some people. Jealousy and bitterness just isn't needed at the moment.

I am appalled at some of the comments on this thread. What have we become in this country? OP I wish you an your family luck and hope we all manage to get through this crisis as best we can.

@UYScuti

There are many reasons people go this route. Here are mine.

1. Most clients in my industry will only hire ltd freelancers. So we have to be ltd to get the work.
2. My old job wouldn’t let me have a single day off in the school holidays. That didn’t work with primary age children and the cost of childcare for two. I could not afford to stay as an employee.

I have been freelance for around 5 years. It has been a struggle but it has meant my kids have been me there for every school play etc. I only bring in around £1200 a month but it keeps us afloat. I am typical of a large number of directors.

I get no sick pay. No pension. No holiday pay. Most months I have no guarantee that the work I’ve lined up to pay my bills will actually happen. This means a lot of graft to find new work (and all that time is unpaid) around the contracts.

Self employment is harder but it is even harder when people with a paycheck and no idea of that insecurity jump on the Daily Fail bandwagon and attack us. We are not tax dodgers.

Big companies with holding companies offshore etc. They are tax dodgers but they own the media and want to take the Panama Papers spotlight off them. We are the convenient target so the masses have someone to blame that the tax receipts are not as high as they could be. Talk to Amazon etc if you want to know about tax dodging. Talk to the City. Not the little people like us who pay our way and get nothing for it.

It’s definitely galling to see small business owners getting so much shit hurled at them while people are using companies like amazon more than ever.

Oh and people it's profit, which in my DH case is let's say he buys a microwave for £20, sells it for £40 and spends £5 fixing it. His profit is worked out gross and net, the government is talking about gross profit. So in this case it would be £40, as his net is £15... But they are going by the profit in total not the expenses laid out to get that end profit total. As a lot of you seem to think OP & OPDH are earning over 50k when this is not the case in all these circumstances.

@OwnedbyOdessa - I don't think you understand this either. His gross profit on that sale is £15. Sales (£40) less cost of sales (£20 plus £5 parts and materials) is £15. His net profit is that £15 less tax.

This whole situation just demonstrates how little the general public understand about business in general and self-employment in particular.

Turnover, margin, gross and net profit, and cashflow all seem like alien concepts to many. The difference between sole traders, partnerships ad limited companies aren't understood, or the significant benefits and disadvantages of each. The main reason for forming a limited company is nothing to do with tax, it's the limited liability protection.

I am appalled at some of the comments on this thread. What have we become in this country? OP I wish you an your family luck and hope we all manage to get through this crisis as best we can.

You should see what people write in the benefit bashing threads that show up here on occasion. Well at least the OP isnt being called a scrounger by the MSM and the government, and I doubt if shell be asked when shes planning on killing herself or have a benefits advisor fabricate an assessment, I doubt OP will end up starving to death because she has been sanctioned for some spurious reason

This whole situation just demonstrates how little the general public understand about business in general and self-employment in particular.

Never seems to bother those with wealth when they talk about the poor

HospitalToast 👏👏👏👏👏

Pretty much same for me. Used to have a job, company forced to close, forced into freelance then Ltd. or no work. Husband in same line of work so we are both hit.

JustAnotherPoster00 I’m not bashing anyone who’s on benefits. I’ve been disgusted by what this government has done to our welfare system and have voted against them at every opportunity.

I just find enjoying someone’s suffering because you feel they somehow deserve it, especially at this time, is repugnant.

Anyway, the Tories want us all fighting amongst ourselves so we don’t notice them screwing us all over in favour of their rich mates. So with that in mind I’m stepping out of this discussion.

Wishing everyone well.