Universal Credit

How UC Works for Self-Employed#

If you're self-employed and claiming Universal Credit, your payment is calculated based on net self-employment earnings for each monthly assessment period.

Rates (2025/26)#

Standard Allowance#

Circumstance	Monthly
Single, under 25	£311.68
Single, 25+	£393.45
Couple, both under 25	£489.23
Couple, one 25+	£617.60

Additional Elements#

Element	Monthly
First child (born before 6 Apr 2017)	£333.33
First child (born after 6 Apr 2017)	£269.58
Second child	£269.58
Housing element	Varies by area
Disabled child (lower)	£156.11
Disabled child (higher)	£487.58
Carer element	£198.31

Work Allowance#

Circumstances	Monthly Allowance
With housing element	£411
Without housing element	£722

Taper Rate#

For every £1 earned above the work allowance, 55p deducted from UC payment.

Minimum Income Floor (MIF)#

After 12 months of gainful self-employment, DWP assumes earnings of at least:

National minimum wage × expected hours × 52 ÷ 12

Even if you earned less, the MIF amount is used - resulting in a lower UC payment. TaxMTD highlights when the MIF is applied.

UC Calculation Formula#

flowchart TD;
    A[Gross Income] --> B[Minus Expenses];
    B --> C[Net Earnings];
    C --> D{MIF applies?};
    D -->|Yes| E[Use MIF amount];
    D -->|No| F[Use actual earnings];
    E --> G[Minus Work Allowance];
    F --> G;
    G --> H[Multiply by 55%];
    H --> I[Taper Reduction];
    J[Standard Allowance + Elements] --> K[Total Entitlement];
    K --> L[Minus Taper Reduction];
    I --> L;
    L --> M[UC Payment];

UC Statement Fields#

TaxMTD captures the full UC statement breakdown:

Field	Description
`paymentAmount`	Headline payment received
`standardAllowance`	Base UC amount
`housingElement`	Housing costs support
`childrenElement`	Child element totals
`totalEntitlement`	Sum of all elements
`minimumIncomeFloor`	MIF threshold (if applied)
`usedEarnings`	Amount DWP uses for taper
`workAllowance`	Earnings before taper
`taperRate`	Deduction rate (0.55)
`totalDeductions`	All deductions combined

API#

// List UC statements
const statements = await $fetch('https://taxmtd.uk/api/uc-statements')

// Create UC statement with full breakdown
await $fetch('https://taxmtd.uk/api/uc-statements', {
  method: 'POST',
  body: {
    periodId: 1,
    assessmentStart: '2026-01-30',
    assessmentEnd: '2026-02-27',
    paymentDate: '2026-03-15',
    paymentAmount: 312.45,
    standardAllowance: 393.45,
    housingElement: 450.00,
    totalEntitlement: 843.45,
    claimant2SelfEmploymentEarnings: 1200.00,
    minimumIncomeFloor: 1400.00,
    usedEarnings: 1400.00,
    workAllowance: 411.00,
    taperRate: 0.55,
    totalDeductions: 531.00,
    reportedIncome: 1200,
    reportedExpenses: 300
  }
})

// Update statement
await $fetch('https://taxmtd.uk/api/uc-statements', {
  method: 'PUT',
  body: { id: 1, paymentAmount: 320.00 }
})