HB & CTR For Small Business Owners (FAQ'S & Key ISSUES)

NEXT WORKSHOP:

Thursday, 10th July, 2025.

Full-Day Workshop: (9:40 - 4:30)  

Please note the change from the originally advertised date.

Workshop Fee:  £270   (No VAT)

 Book 3 places and receive a 4th place FREE.

Also available for In-House Bookings for individual organisations, either On-Site or Online.

This Workshop topic is often requested as a 1 or 2-Day In-House course for Benefits Assessment Staff, with the first day covering the "Self-Employed" and the second day covering "Company Directors."  

FAQ's & Key Issues When Assessing Means Tested Benefits For Small Business Owners (Self-Employed & Ltd Company Directors) 

Distilled from our postbag and from FAQs raised on discussion forums we have put together this combined programme looking at the issues that cause the most confusion and disagreement when handling claims from small business owners. 

Over the years we have delivered many one-day Workshop programmes on each of the two topics “Self-Employed Earnings” and “Company Directors”. For this combined Workshop we have taken the key points from both topics, focussing on the issues that generate the most questions and the most debate among practitioners. Both topics remain available as an in-house Workshops covering a full day each: either can be booked individually, or both together as a two-day Workshop.

The combined day devoted to FAQs on both topics includes the following relating to Self-Employment:

• Renting out property: When can the capital value of property occupied by tenants be disregarded as capital on the basis that it is a self-employed business asset? This has been the subject of several landmark Upper Tribunal cases. 
• Dual purpose expenses: Expenses can be deducted from the claimant’s self-employed earnings if they are “wholly and exclusively” incurred for business purposes. We will consider how this applies to expenses such as travel, subsistence, clothing and use of the home as an office – especially when both personal and business use of fuel, phone, broadband etc are covered by a single bill for all use. One recurring question concerns the treatment of flat-rate costs, such as vehicle tax and MOT, some vehicle insurance policies, and utility standing charges - given that these items do not vary according to usage, and the claimant would not pay any less if s/he did not use that particular item/utility for business purposes. Can it be said that part of the charge is ”wholly and exclusively” a business expense?.
• Making a loss: A question we are asked a lot is whether a claimant who makes a loss or no significant profit year after year should really be regarded as self-employed at all, and if not how that affects HB/CTR. What can or should the authority do in such cases?
• Retrospective adjustments: HB is aways paid on the basis of an estimate of what the claimant’s earnings will be. What should we do if that estimate turns out to be inaccurate? When do we go back?

FAQs relating to Company Directors include:

• Director’s loan account: What is it and how does it affect HB/CTR?
• Shares as capital: Should the value of the claimant’s shares in his/her own company be taken into account as capital for HB/CTR? If so, how should they be valued? Or should the shares simply be disregarded on the basis that the claimant’s company is analogous to self-employment? We discuss the competing arguments for and against each approach.
• Low earnings and high profit/dividend: Many company owners draw a small salary – usually just under the tax/NI threshold, but they receive dividends out of the company’s profits .. and those profits will be higher the less the company pays out in expenses such as staff salaries. How should dividend income be accounted for in HB and CTR?

The Full Day Workshops options go into greater depth and include topics that are not covered on the joint day: The differences between self-employment and running a company, different incorporation models for a company, more varied income and expenditure examples for self-employed claimants and more opportunities to do exercises derived from real case studies.

Presented by Peter Barker, a hugely experienced trainer, appeals presenter and submission writer. He started as a local authority appeals officer in the 1980s, and for many years he has represented local authorities in England, Wales and Scotland at both First-Tier and Upper Tribunal level. Tribunal Judges frequently comment on the high quality of Peter’s submissions. He combines a wealth of first-hand experience with expert knowledge of adjudication legislation and has a real enthusiasm for the topic.

Contact us for In-House / Online booking information  for this topic.  

Topics Covered:

Self-Employment FAQs:

• Business assets and capital

                     o Especially renting out property

• Separating business expenses from personal expenses

                     o “Wholly and exclusively” for business purposes

• Long term losses / insignificant profit
• Data-matching with HMRC self-assessment returns

                     o Especially renting out property

• Changing your mind and going back

                     o Can you revise an inaccurate estimate of self-employed earnings?

Company Director FAQs:

• The Director’s Loan Account

                     o What is it and how does it affect HB/CTR?

• Shares and capital

                     o Include as capital or disregard?

                     o How to value as capital?

• Low salary supplemented by high dividends

                     o How should dividend income be treated in HB/CTR?

We are always pleased to arrange most of our Workshops, such as this one, for staff from an individual organisation. Please email us with your requirements for details.