Working on UC
Calculator · self-employed · 2026 to 2027 rates

Will UC treat you as earning more than you do?

If you're self-employed, UC may treat you as earning a set amount, even in months when you earn less. This is called the minimum income floor. Check whether it applies to you, and what it means for money you put into a pension.

Answer the steps in order. You can stop if it says the floor doesn't apply to you.

Step 1: Does it apply to you?

How long have you been self-employed on UC?
Do any of these apply to you?

Step 2: Your floor

How old are you?

This sets the minimum wage used: £12.71, £10.85 or £8.00 an hour from April 2026.

a week

Usually 35. It can be less, for example if you care for a school-age child or have a health condition. It's in your claimant commitment.

Step 3: What you earned this UC month

£this month

Money coming in, minus business costs, minus any tax and National Insurance you paid this month.

£this month

What left your bank account. Don't add the tax relief your pension company adds.

£this month

How the floor is worked out

  1. Take the hours DWP expects you to work each week, usually 35.
  2. Multiply by the minimum wage for your age. Then turn it into a monthly amount.
  3. Take off income tax and National Insurance, as if you'd really earned that much.
  4. If you earn less than that in a month, UC uses the floor instead. Pay from a job counts towards it.
  5. Money you put into a pension lowers what you really earned, but it doesn't lower the floor.

More detail: self-employment and the minimum income floor.

Good to know

  • This checks one person. For a couple, DWP compares your earnings together against a joint amount, which can lower the floor or remove it.
  • Tax is worked out with the rates for England, Wales and Northern Ireland. Scottish rates are slightly different.
  • DWP's figure may be a few pence different. LITRG's example for 35 hours at £12.71 is £1,681.45.
  • Losses from earlier months can be carried forward, but if they take your profit below the floor, they're wasted.
  • This is an estimate, not financial or benefits advice. Citizens Advice can check your figures for free.
Where these figures come from

Checked November 2026.