When you're self-employed and fall ill, you might have some genuine concerns about how you'll be able to support yourself.
The good news is, you may be able to claim self-employed sick pay depends on the structure of your business.
Furthermore, even if you’re not entitled to Statutory Sick Pay (SSP), there are other sickness benefits that you could be entitled to.
Can I Claim SSP if I'm Self-Employed?
In most instances, self-employed people aren't able to claim many of the benefits available to employees, including statutory sick pay (SSP).
SSP is a payment available to employees when they’re too sick to work for an extended period of time.
Whether you're able to claim SSP as a self-employed worker will depend on the legal structure of your business.
If you’re a director of a limited company, then technically you’re an employee of your business. This means you would be entitled to SSP at the same rates as your employees.
However, if you operate as a sole trader or in a partnership, you won’t be able to claim SSP. Don't worry, there are other self-employed sickness benefits that you might be able to claim.
How Do I Claim SSP as a Limited Company Director?
As we've mentioned already, a limited company director is an employee, so they can claim SSP through their business.
The usual SSP rate applies. In 2020-21 the SSP rate is £95.85 a week for up to 28 weeks.
If you’re unable to work due to illness as a limited company director, you need to follow the SSP rules. These rules mean you have to have been off work for four or more days in a row, including non-working days. Days when you’re meant to be working but are off sick are known as ‘qualifying days’.
The first three days are known as ‘waiting days’. You’re entitled to SSP from the fourth day you’re unable to work.
You need to earn an average salary of at least £118 a week to qualify for SSP.
What Sickness Benefits Are Available for Self-Employed Sole Traders and Partners?
Whilst sole traders and partners can’t claim SSP, there are still other benefits they might be entitled to.
One that could cover you if you were unwell would be the Employment and Support Allowance (ESA). You might be entitled to weekly ESA payments if you have a long-term illness or disability meaning you’re unable to work.
To qualify for this you will need to be:
- 16 or over
- under the State Pension age
- living in England, Wales or Scotland
- not claiming Job Seekers’ Allowance (JSA)
- paying enough National Insurance contributions
While there are different types of ESA that people can claim for, most will claim ‘new style’ ESA. For this, you need to have been self-employed for the last two to three years and have two tax years of National Insurance contributions.
You can apply for ‘new style’ ESA online at gov.uk or over the phone. When you apply you'll need:
- proof that you have limited capability for work (fit note)
- National Insurance number
- bank or building society account number and sort code
- GP’s details
- income details if you’re working
How Much ESA Can I Claim?
If your claim is accepted you should expect your first payments a few weeks later. These will usually be backdated by up to three months, to cover the time you weren’t able to work.
When you first claim for ‘new style’ ESA or contribution-based ESA, you’ll usually get:
- £74.35 each week (aged 25 or over)
- £58.90 each week (aged under 25)
After three months, you'll be assessed by the DWP. Depending on your illness, you’ll be placed on one of the following rates:
- up to £73.10 a week (if you’re able to go back to work)
- up to £111.65 a week (if you’re not able to go back to work)
SSP and Coronavirus
The government has made changes to SSP for employees to reflect the ongoing coronavirus outbreak.
The changes mean that employees who are ill or are self-isolating from COVID-19 are entitled to SSP from the first day of being off work, rather than day four.
If you’re not eligible for SSP but you’re ill because of coronavirus, or the virus has affected your ability to work in other ways, you might be eligible for different government support – such as the Self‐Employment Income Support Scheme. Click here to check your eligibility.
Hopefully, you won't be ill any time soon, but if you are we hope you're now armed with the info you need to claim the sick benefits you're entitled to.
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