The UK Rules
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New Enterprise Allowance

New Enterprise Allowance Scheme

The UK Government first introduced New Enterprise Allowance in April 2011. The NEA scheme assists unemployed people who are looking to start up in business.

NEA GUIDE: The New Enterprise Allowance program renders a resourceful combination of money and practical support.

Joining the scheme means you would get a weekly allowance and business mentoring. But, you must be claiming one of the qualifying benefits.

As a rule, you can join the program from the first day you start claiming for JSA or Universal Credit. But, there are some extra qualifying conditions.

Jobcentre Plus refer any interested and eligible candidates to a contracted provider organisation. The next step matches them up with their volunteer business mentor. They will then help them to draw up a business plan.

Individuals can then access the financial support once the plan gets approved and they stop claiming benefits.

New Enterprise Allowance Eligibility Criteria

You need to be over 18 to qualify for the New Enterprise Allowance initiative. You must also be able to show that you have a business idea - and that it could work. On top of that, you also need to be receiving one of these work-related benefits:

Note: You may also qualify if you get Universal Credit. This also applies even if you have already become self-employed.

The Jobcentre will assign you a business mentor if you are starting up a new business. The mentor will be able to give you advice and specialist support on:

New Enterprise Allowance Financial Support

You will need to write a business plan and get it approved before you can:

Note: Being part of the Work Programme means you do not qualify for the New Enterprise Allowance.

Payments do not affect your claim for Housing Benefit, Income Tax, tax credits, Universal Credit, or the Access to Work grant.

Self-employed Claiming Universal Credit

Those who are self-employed and claiming Universal Credit may qualify for:

How the New Enterprise Allowance Works

Individuals who get accepted onto the scheme must meet these three specific conditions:

  1. Attend all meetings with mentor or mentoring provider organisation. As a rule they will give you at least 24 hours of notice to attend.
  2. Perform weekly tasks that help to develop the business proposal.
  3. You must contact Jobcentre Plus (within 2 days) and inform them if the business idea ceases or the mentoring relationship ends.

Failure to meet these conditions means your benefits could get sanctioned. There may be exceptions where there are valid reasons.

Changing your mind before the scheme starts does not result in a benefit sanction. The same applies if you give a notice of 2 days before leaving the scheme once it is in progress.

New Enterprise Allowance Scheme Rules in the United Kingdom