Working Tax Credits financial support for an entrepreneur

working tax credit formsA disabled person can apply for working tax credits if they are over 16 years of age, working over 16 hours and will be in business for at least 4 weeks. Most disabled entrepreneurs will qualify for these credits but often don’t apply, as they are worried that in the initial stages of business they will not be working for 16 hours. They think this because they only count the hours they are actually with a client. They should also be counting the hours marketing the business, going to suppliers, doing the accounts etc. All these tasks are included in calculating the total number of hours.

Before starting the business I would contact my Disability Employment Adviser or Working Tax Credits Department and ask that they to do an assessment of how much I would be entitled to. Working Tax Credits are calculated on either your income for the previous year or a prediction of your wages for the year of trading. Most people choose to have the calculation done on what they earned last year as in most cases, this will be the amount of benefits received and should make them eligible.

The amount of Working Tax Credits can vary, but in most cases it’s roughly the same as your current benefits. After you have been trading for a year on your WTC you will have to submit your earnings to see if you qualify for the next year. As most businesses do not make a profit in the first year it is likely that you will be able to stay on the WTC for another year. This will give your business time to get established before you have to take a wage from it. Read my article Working Tax Credits Vs Test Trading Vs Permitted Work to see which scheme could be best for you

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