Self employment, passive income, affiliate links and ESA

jhorner

I’m struggling to find accurate information on this and don’t want to ask the DWP yet for reasons which probably don’t require explanation. Please only reply with advice if you have direct experience or definitely do know. 

I’ve been on contribution based ESA for 10 years (support group) and haven’t been reassessed, though this is overdue. I have been assessed for DLA and 2x for PIP in that time though (currently high rate mobility, standard care). So part of my concern isn’t just what I technically can do but if it will go against my reassessment if I’m seen to be earning some money (not support group category)? 

I’m frustrated from not working this long, though realistically my health is too bad and unpredictable to be able to earn the same as ESA, unless I strike lucky! Ive been following the AI Revolution closely though and this is giving me some hope and ideas for passive income streams, where I could do some work when well enough then simply not do anything when too ill (I can’t sustain employee style work and have tried again as Permitted Work). 

I’m really unclear on where this stands with the DWP. Looking at the Permitted Work form I can’t really complete any of the information. I’ll have no idea how much I’ll earn, it might be nothing, a steady trickle, or a lot. If I do earn money it will be probably quite separate time wise from when I did the ‘work’ and I might be incapable of any work or paperwork when the money comes in. At what point do I contact them? Is it when I earn a certain amount? I’m contribution based so I don’t think the amount I earn per week matters, just the hours I work? 

An example is adding affiliate links to my blog (I have better but harder to explain ideas too). Does this count as working? Adding a link probably takes 2 minutes of work, and my blog exists already, but I’m guessing from the point I start earning from the blog any time spent blogging is then work time I need to log? The blog is on the topic of my disability, so doesn’t undermine my ESA claim, especially as I’m explicit that a lot of recent content was written by AI. Does it become work if I receive actual money but not if it’s a discount or voucher? If I receive AI tokens is that different? 

For people not claiming disability benefits, there’s a disregard type of amount of £1000 before the HMRC is bothered, eg starting an Etsy shop. Is there similar on ESA for unpredictable, non employee work?

I also remember a disabled colleague on ESA having a year to test out part time work and then having to jump either way (just ESA or just working). Does this still apply? Are there any schemes to help disabled people setup our own businesses?

poppy123456

When self employed it’s the earnings that are more important than the hours you work. You can’t really say how many hours you would do with something like this. 

The permitted work earnings for 2023/24 are £167/week. If you earn more than this then there will be no entitlement to ESA. 

As self employed you will need to report your earnings and expenses to ESA but I have no idea how often they will expect you to do this. 

There’s no time limit how long you can do permitted work for. So the example with your colleague no longer applies.
If you start working then you will need to tell DWP and fill out a PW1 form. 

Further details here, including the form. 

https://www.gov.uk/government/publications/employment-and-support-allowance-permitted-work-form

jhorner

poppy123456 said:

When self employed it’s the earnings that are more important than the hours you work. You can’t really say how many hours you would do with something like this. 

The permitted work earnings for 2023/24 are £167/week. If you earn more than this then there will be no entitlement to ESA. 

If you start working then you will need to tell DWP and fill out a PW1 form. 

Further details here, including the form. 

https://www.gov.uk/government/publications/employment-and-support-allowance-permitted-work-form

Thanks my understanding was the other way around- because I get contributions based ESA they’re not too bothered on the money side, they care more how many hours I work? I know what you’re saying is correct for means tested ESA though. 

Or is it only your partner’s earnings they disregard for contributions based? It might also have changed in the time I’ve been claiming. 

Should I wait until I actually start to earn something? There’s nothing really I can add on the PW1 right now and I might never make any money 😆  Although a potential option could involve me having small % equity in a larger partnership so I sort of want to know where I stand before jumping into something like that. 

poppy123456

jhorner said:

poppy123456 said:

When self employed it’s the earnings that are more important than the hours you work. You can’t really say how many hours you would do with something like this. 

The permitted work earnings for 2023/24 are £167/week. If you earn more than this then there will be no entitlement to ESA. 

If you start working then you will need to tell DWP and fill out a PW1 form. 

Further details here, including the form. 

https://www.gov.uk/government/publications/employment-and-support-allowance-permitted-work-form

Thanks my understanding was the other way around- because I get contributions based ESA they’re not too bothered on the money side, they care more how many hours I work? I know what you’re saying is correct for means tested ESA though. 

Or is it only your partner’s earnings they disregard for contributions based? It might also have changed in the time I’ve been claiming. 

It's only a partners earnings that are disregarded for CB ESA. For you as a claimant then permitted work rules apply in the same way they do for any ESA claim.

If you're working then you need to inform them but this doesn't have to be before you start working.

jhorner

Yes I’d misremembered that. It seems very difficult to get off ESA this way. I certainly wouldn’t want to risk losing contribution based ESA for an income that might occasionally go over £167/week but mostly be less than ESA. 

This is making me feel trapped when I just want to dip my toe in and see if it is possible to earn a living this way. The government needs to do a lot more to help disabled people become self employed, it’s the obvious answer to a lot of the problems we have with earning a living (though not all of course, I won’t suddenly be able to work full time or reliably). 

Am I right in thinking that once I lose contribution based ESA I won’t be able to claim that again (having not paid enough NI for a decade and with changes to the benefits system in this time?). Or is there a safety net if I need to reapply within a certain amount of time? 

jhorner

I’m wondering if there might be legal workarounds to stabilise income? For example, can I set up a company and then pay myself a steady wage under £167 (once I start earning that) as an employee of the company, with any excess income to the company being invested in growing the company (production costs and advertising) rather than my income? Realistically I’m expecting it would be a long time before genuine profit/wage would exceed that regularly and at that point I’d be less anxious about losing ESA.