How to start a small business with no money and how it will effect your benefits (UK)

If you are on benefits and you want to start a small business, how will this affect your benefits?

The job centre can give you a 'start-up year' where they pay you for a year, whilst you start up your business. Then after that year, they assess if you earn enough money every month to be 'gainfully employed' and if you do earn the threshold they set, they can top up your wage if it's a low wage, after the limit they set as your earning threshold, but deducted from your pay. If you don't meet that criteria of earning enough money, then they put you on job seekers allowance and you have to cease your business and look for work and prove that you are looking for work and getting interviews and work, or they sanction you.

There is a caveat of if you have children under school age you're only required to do around 16 hours a week. If your kids are school age they expect you to do 30 hours a week work. If you have disability you can do less hours - but have to go through PIP assessment ect.

The job centre can put you on courses to help improve your skills, point you to your local chamber of commerce and offer more advice and support to you, whilst you start up your small business.

So, how do you start a small business when you have no money?

So you want to start a small business, but you don’t have a lot of money to do so, can you start a small business on a small budget! Absolutely! Here are ways you can work on a small budget!

1: Brainstorm your skills; what can you offer that your skilled in, what can you borrow from others, what can grants can you get, who do you know that can help support you. What is demand that you can fulfill with your skills and resources. TEST your idea first and build upon it!

2: Explore funding options: Grants, business loans, fundraising, personal investments, start-up loans, angel investors, crowdfunding, family or friends loan, bank loan ect.

3: Don’t give up your day job and do little of your small business every day, even if it’s 3—60 minutes a day. Don’t give up your secure finance until you know you can go full time with your small business.

4: Don’t skip on writing your business plan and creating goals, schedule and strategy for your small business and make sure your ready to do this before you start! It’s not as easy as what people say it is, building a business takes time and effort.

4: Choose a low cost business model, calculate your business start up and running costs with minimal hard costs and outgoings and plan for increasing your income.

We have an affordable financial planner what can help you understand how to financially sustain your small business – Check it in our shop.

We hope this post gives you the information you need to feel inspired, empowered and educated.

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The Business parents Organization.