JSA for contractors - money in Ltd account.

[original PM]

But I thoiught that to claim JSA you had to prove you had been laid off and not sacked/left the job of your own accord.

So surely in order to claim JSA you need to stop being an employee of your LTD?

Absolutley no idea what the score is if you are a director of your LTD...

[mudskipper]

I don't have a problem with unemployed people with money claiming contribution based JSA. I find it perverse that a company director, who takes a tax advantage as a business rather than as a disguised employee, can have spare money in the Ltd and claim to be unemployed / laid off. It seems to me that if you want the advantages of being in business, you should pay your salary between contracts (if you have that money). But I accept it may be legal.

I am interested whether being upfront and honest includes advising the Dole Office how much money and spare money (after tax obligations are met) is in the Ltd account.

I agree with you on the first part, but each to their own. We all manage our financial affairs as we see fit - I still get child benefit, which some may see as immoral. I know someone else who went down to a very low income while his son was at uni so that they'd get the extra financial help - out of order in my book, but is it so different to getting child benefit?

As far as upfront and honest, if you're asked about your finances then I would hope that you would explain the situation and show company accounts if asked to do so. If contribution based JSA isn't income dependent, I don't see why they'd ever want to know.

[NorthWestPerm2Contr]

I don't have a problem with unemployed people with money claiming contribution based JSA. I find it perverse that a company director, who takes a tax advantage as a business rather than as a disguised employee, can have spare money in the Ltd and claim to be unemployed / laid off. It seems to me that if you want the advantages of being in business, you should pay your salary between contracts (if you have that money). But I accept it may be legal.

I am interested whether being upfront and honest includes advising the Dole Office how much money and spare money (after tax obligations are met) is in the Ltd account.

Could it also be argued that we should not claim child Benefit as our "business income" is actually greater than 50k even if we chose to pay ourselves a lot less?

[VectraMan]

I am just wondering if 'totally upfront and honest' includes showing Ltd company bank statements, although I now understand from what you say that there is formally no need to do so.

Not for the first 6 months anyway. IMHO, if you're going to claim to be a proper business and the business still has money, then the business should keep paying your salary whether you're in a contract or not. But that's a moral judgement.

JSA is irrelevant anyway. What you really want is Housing Benefit. The 3 weeks worth of JSA I got last year wouldn't have covered a third of my rent.

[speling bee]

But I thoiught that to claim JSA you had to prove you had been laid off and not sacked/left the job of your own accord.

So surely in order to claim JSA you need to stop being an employee of your LTD?

Absolutley no idea what the score is if you are a director of your LTD...

Presumably, you in your role as company director lay you off in your role as employee, so you haven't left the job of your own accord at all.

[NorthWestPerm2Contr]

I agree with you on the first part, but each to their own. We all manage our financial affairs as we see fit - I still get child benefit, which some may see as immoral. I know someone else who went down to a very low income while his son was at uni so that they'd get the extra financial help - out of order in my book, but is it so different to getting child benefit?

As far as upfront and honest, if you're asked about your finances then I would hope that you would explain the situation and show company accounts if asked to do so. If contribution based JSA isn't income dependent, I don't see why they'd ever want to know.

Was just thinking about that - child benefit has always supposed to be a benefit for all (rich and poor alike) so the idea that you should stop claiming if you are well off kind of goes against the original purpose of it. I claim child benefit myself and see that is our right. The actual change in legislation itself is actually unfair - Mrs NWP2C doesn't work so our combined income is actually well below 100k.

I think the difference between JSA and CB is that with JSA the idea is you are looking for a job whilst CB is a benefit supposedly for all with children.

[speling bee]

Could it also be argued that we should not claim child Benefit as our "business income" is actually greater than 50k even if we chose to pay ourselves a lot less?

I guess it could. But the thing with the JSA that puzzles me is that I don't think the claimant is really unemployed. Are they looking for jobs as an employee? Or are they looking for contracts for their business? And if the latter, isn't that working?

However, it does appear to be legal.

[evilagent]

Presumably, you in your role as company director lay you off in your role as employee, so you haven't left the job of your own accord at all.

but if there is a clear pattern of being "employed" by your company whilst in contract, and "unemployed" when a contract comes to an end, arent you showing yourself to be a disguised employee of the client?

[mudskipper]

Was just thinking about that - child benefit has always supposed to be a benefit for all (rich and poor alike) so the idea that you should stop claiming if you are well off kind of goes against the original purpose of it. I claim child benefit myself and see that is our right. The actual change in legislation itself is actually unfair - Mrs NWP2C doesn't work so our combined income is actually well below 100k.

I didn't change what I was already doing - I've always taken money up to the higher tax threshold, so just carried on as before. At some point I'll take more out, and I'll probably leave that until I no longer get CB (youngest is 16, so guess it stops soon). Dunno if I would actually claim if they'd stopped it and required us to reapply.

[VectraMan]

But I thoiught that to claim JSA you had to prove you had been laid off and not sacked/left the job of your own accord.

Nobody ever asked me for any proof. I didn't even send them my P45.

I also told them I'd resigned my previous job, and that I'd been working (on the Plan B) over the previous 6 months. I think in the end I confused them so much they just gave me money. Half the problem is that the person you talk to isn't qualified to make any decision; they write things down that gets sent to some mysterious other organisation who makes the decisions, so the potential for Chinese Whispers is huge.

I half expect to have to pay my £210 JSA back. I can't see how I was entitled to it by any logic.