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<p>We are aware that for many self-employed, particularly those with seasonal businesses,
their earnings often fluctuate from month to month, and they need to budget and plan
for this. Self-employed Universal Credit claimants are no different in this regard.</p><p>
</p><p>Universal Credit supports people in self-employment, where self-employment
is the best route for them to become financially self-sufficient. As part of that,
for those claimants expected to seek work, who are gainfully self-employed and not
within a year of starting their self-employment, we apply a Minimum Income Floor (MIF).
This is an assumed level of monthly earnings, based on what they could expect to earn
each month at the National Minimum Wage.</p><p> </p><p>The MIF is designed to encourage
those reporting very low self-employed income to increase their monthly earnings.
This means that, where a self-employed claimant’s monthly earnings are below their
MIF level, the MIF level is taken into account in assessing the claimant’s monthly
Universal Credit payment. For this reason, they can receive a lower amount of Universal
Credit than an employed claimant earning a comparable monthly sum, but not subject
to the MIF.</p><p> </p><p>Some self-employed claimants will respond to this by increasing
their monthly earnings from self-employment, some will choose to work as an employee,
and others will combine the two. All are potentially good outcomes for them, their
families and the taxpayer.</p>
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