Self-employed and unemployment

Introduction

Self-employed people can become unemployed if their business has to close down. It may also be the case, though you continue to be self-employed the amount of work you are getting has reduced so much that it no longer provides you with a sufficient income.

If you find yourself unemployed or you are getting less work than before you may qualify for a jobseeker's payment. You do not need to de-register as self-employed to get a payment. However you must meet the conditions that apply to jobseeker's payments.

If you do not qualify for a social welfare payment you may be eligible to pay voluntary contributions.

COVID-19 and self-employment

The COVID-19 Pandemic Unemployment Payment (PUP) is for employees and self-employed people living in Ireland who have lost their employment due to COVID-19. If you lost your job for another reason, you can apply for a jobseeker’s payment.

If your self-employment has been affected by COVID-19, or if you are sick or caring for someone who is sick, read our document on COVID-19 (coronavirus) and social welfare payments.

You can also read about the supports for businesses during COVID-19.

Jobseeker's Benefit (Self-Employed)

Jobseeker’s Benefit (Self-Employed) (JBSE) is a weekly payment from the Department of Social Protection (DSP) to people who lose their self-employment.

To qualify for Jobseeker’s Benefit (Self-Employed) you need:

  • At least 156 weeks of Class S contributions or at least 104 weeks of paid Class A or H PRSI since first starting work
  • 52 weeks of Class S contributions paid in the relevant tax year. The relevant tax year is the second-last complete tax year before the year in which your claim is made. So, for claims made in 2020, the relevant tax year is 2018.

To get Jobseeker's Benefit (Self-Employed) you must stop all self-employment activity. However, you can work as an employee for up to 3 days each week and continue to get Jobseeker's Benefit (Self-Employed).

If you don't qualify for Jobseeker's Benefit (Self-Employed) you may qualify for Jobseeker's Allowance.

Jobseeker's Allowance

Jobseeker's Allowance (JA) is a weekly payment from DSP to jobseeker's. To get Jobseeker’s Allowance you must be habitually resident and pass a means test. If you are self-employed, you may be entitled to Jobseeker's Allowance depending on your earnings from your business. You do not need to close your business or stop working as self-employed for you to get Jobseeker’s Allowance and you don't have to be unemployed for at least 4 out of 7 days, as for Jobseeker's Benefit. You will get Jobseeker’s Allowance if your income is below a certain level.

Income from self-employment and the means test
The earnings from your business will be assessed in the means test for Jobseeker’s Allowance. The assessment must reflect the income you may reasonably be expected to get from your business over the next 12 months. Income for the last 12 months will be taken as a guide but allowing for any factors which it is known will vary. You should be prepared to discuss these factors when you are assessed for Jobseeker’s Allowance.

Earnings are assessed as gross income less work-related expenses over 12 months. Your expected annual earnings from self-employment is divided by 52 to find your weekly means from self-employment. Any ‘drawings’ you take from the business is not an allowable expense. If your ‘drawings’ from the business are greater than the level of income calculated, the ‘drawings’ are assessed as cash income. There is no exhaustive list of all business expenses allowed because expenses vary with the nature and extent of the self-employment. However the following are the main allowable expenses in most cases:

  • Materials (supplies costs)
  • Motor running costs (portion applicable to business)
  • Depreciation of machinery or equipment
  • Insurance relating to the business
  • Telephone (portion applicable to business)
  • Lighting and heating (for business and not domestic use)
  • Advertising
  • Bank charges
  • Stationery
  • Van leasing
  • Any other costs associated with running the business (household running costs are not allowed as deductions against business profit)

To prove the level of income from your business you must give your receipts and payments (documentation showing money coming in and out of your business) or audited accounts to the person dealing with your application in your Intreo Centre or Social Welfare Branch Office.

When you apply for Jobseeker’s Allowance
Usually, you will be asked for your receipts and payments or audited accounts for the current and previous year. For example, if you apply for Jobseeker's Allowance in April 2020 you will be asked for your receipts and payments from January to April 2020 and for 2019. However, in certain cases you may be required to show audited accounts for the last two or more years. Find out more about signing on for a jobseeker’s payment.

You may qualify for Supplementary Welfare Allowance while you are waiting to be assessed for a jobseeker’s payment or if you don’t qualify for a jobseeker’s payment.

Supplementary Welfare Allowance

Supplementary Welfare Allowance provides a basic weekly allowance to eligible people who have little or no income. If your weekly income is below the Supplementary Welfare Allowance rate for your family size, a payment may be made to bring your income up to the appropriate Supplementary Welfare Allowance rate.

You cannot get Supplementary Welfare Allowance if you are working more than 30 hours per week. If you have claimed a jobseeker’s payment but it has not yet been paid and you have no other income, you may qualify for Supplementary Welfare Allowance while you are awaiting payment.

Other benefits

If your income is below a certain amount you may get a medical card or a GP visit card.

You may get help with paying your rent. If you are in local authority housing, you should contact your local authority and ask for a review of your rent because of the reduction in your income.

You may get help with the cost of uniforms and footwear for children attending school. The Back to School Clothing and Footwear Allowance Scheme operates from 1 June to 30 September each year.

If you have an exceptional or urgent need, for example, you need help with a funeral bill, a range of discretionary payments are provided by the Department of Social Protection's representative in your Intreo Centre or Social Welfare Branch Office.


Page edited: 6 October 2020