Reporting self-employed earnings

This advice applies to Wales. See advice for See advice for England, See advice for Northern Ireland, See advice for Scotland

You need to report your earnings every month to the DWP - they won't remind you.

You'll have to report earnings for each month the DWP calculate your Universal Credit payments - this is called an 'assessment period'. Your assessment period usually starts on the same date each month - starting 1 calendar month after the date you submit your claim online or over the phone.

You can report your earnings for the month from 7 days before and until 14 days after the end of your assessment period.

Example

Ruth claims Universal Credit on the 8 November. Her assessment periods start on the 8th day of each month.

Her first assessment period runs from 8 November to 7 December. She must report her earnings for this period to the DWP between 1 December and 21 December.

If you can't report your earnings on time

The DWP might be able to base your payment on an estimate of your earnings. You'll need to have a good reason why you couldn't report your earnings on time. For example, if you were admitted to hospital at short notice and no-one else had access to your accounts.

If you don't have a good reason, the DWP will usually stop your Universal Credit claim until you report your earnings.

Contact the DWP as soon as possible to explain why you're reporting your earnings late.

Universal Credit helpline

Telephone: 0800 328 5644

Telephone (Welsh language): 0800 328 1744

Textphone: 0800 328 1344

Relay UK - if you can't hear or speak on the phone, you can type what you want to say: 18001 then 0800 328 5644

You can use Relay UK with an app or a textphone. There’s no extra charge to use it. Find out how to use Relay UK on the Relay UK website.

Video relay - if you use British Sign Language (BSL).

You can find out how to use video relay on YouTube.

Monday to Friday, 8am to 6pm

Calls are free from mobiles and landlines.

Working out your earnings

Add up all the income your business has received during the assessment period - these are called 'receipts'.

Then take away amounts you've spent on your business - these are called 'personal allowances and permitted expenses'. This will give you your final earnings amount.

Personal allowances

You'll need to take amounts for the following off your earnings:

  • income tax - if you've paid any that month

  • National Insurance - if you've paid any that month

  • pension contributions you make

Permitted expenses

You should take away amounts you've spent on reasonable expenses for your business. These might include:

  • stock or equipment

  • rent for business premises, office or storage space

  • insurance - such as liability or buildings insurance

  • repayment of interest on a loan - up to £41 a month

  • VAT

Costs of a vehicle

You can deduct expenses for the costs of a vehicle you use for your business. The amount you can deduct depends on the type of vehicle you use.

If you use a car for business, you can deduct a fixed amount for each mile you travel for business - this is called a ‘flat rate deduction’.

If the vehicle isn't a car - for example, if it’s a van or motorcycle - you can choose to deduct either:

  • flat rate deductions

  • the actual expenses of buying and using the vehicle - including petrol, servicing, repairs, insurance and MOT

Flat rate deductions are 24p per mile for a motorcycle. For other vehicles they're 45p per mile for the first 833 miles then 25p a mile after that.

If you use your home for business purposes

You can deduct expenses for use of your home by either:

  • working out the costs of using your home for business purposes

  • using flat rate deductions

The amount of the flat rate deduction depends on the number of hours you spent working at home during the assessment period.

Hours spent working at home during the assessment period Flat rate deduction
Hours spent working at home during the assessment period
Between 25 and 50 hours
Flat rate deduction
£10
Hours spent working at home during the assessment period
More than 50 but no more than 100 hours
Flat rate deduction
£18
Hours spent working at home during the assessment period
More than 100 hours
Flat rate deduction
£26

Reporting your earnings

Report your earnings through your online journal.

If you've done paid work for an employer, you should report this income too.

If you need help or support reporting your earnings, call the Universal Credit helpline.

Universal Credit helpline

Telephone: 0800 328 5644

Telephone (Welsh language): 0800 328 1744

Textphone: 0800 328 1344

Relay UK - if you can't hear or speak on the phone, you can type what you want to say: 18001 then 0800 328 5644

You can use Relay UK with an app or a textphone. There’s no extra charge to use it. Find out how to use Relay UK on the Relay UK website.

Video relay - if you use British Sign Language (BSL).

You can find out how to use video relay on YouTube.

Monday to Friday, 8am to 6pm

Calls are free from mobiles and landlines.

If you don’t make a profit in a month

You should still report your income and what you’ve spent on your business through your online journal.

If you’ve made a loss, this will be taken off your profit the next time you make a profit. This means you might get more Universal Credit in future.

Example

Alessia is self-employed and gets Universal Credit.

In January, Alessia reports that she made a loss of £500. In February, she reports that she made a profit of £800.

The loss from January is taken off the profit from February. £800 minus £500 is £300.

Alessia’s Universal Credit payment for February is calculated as if she made a profit of £300.

What happens next

The DWP will check your earnings amount and whether the minimum income floor applies to you. Then they'll work out how much Universal Credit you should get paid for the assessment period. The DWP aim to pay you within 7 days of the last day of your assessment period.

Check if the minimum income floor applies to you.

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Page last reviewed on 18 December 2018