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Q: I was laid off eight months ago, and have been on the dole since. It’s my first time on the dole in 30 years in the workforce. However, I have a business idea and I’m really thinking about giving that a go – but I’m afraid I will lose my social welfare entitlements. Am I caught between a rock and a hard place? (CC, email).
A: You might be in a good position, CC, primarily because of the Back to Work Enterprise Allowance (BTWEA) scheme promoted by the Department of Employment Affairs and Social Protection, writes Liam Horan, Career Coach, Sli Nua Careers, Ballinrobe.
Their website says: “The BTWEA scheme encourages people getting certain social welfare payments to become self-employed. If you take part in the BTWEA scheme you can keep a percentage of your social welfare payment for up to 2 years.”
Though their site doesn’t specifically state it, my understanding is that you retain your full unemployment payments for year one, and 75 per cent for year two. You retain those payments no matter how well your business goes during those two years.
It is designed as a support to someone who wants to move from unemployment to self-employment. The only ‘catch’ is that you have to be getting the relevant social welfare payments for at least nine months – but, in your case, CC, you are almost at that point, so the timing could be just right.
Get more information on the BTEA here: https://goo.gl/uxHSvo. A scheme for people who haven’t been unemployed for nine months, but who wish to set up their own business, is the Short-Term Enterprise Allowance (STEA) which has similar benefits. Read more here: https://goo.gl/6SuLWi
Under both schemes, you can also get financial support with the costs of setting up your business, in addition to income support (your weekly payment). These supports are provided under a scheme called the Enterprise Support Grant (ESG).
The site says: “You can only get the ESG if you have been approved for the BTWEA. The business plan you submit as part of your application for the scheme must set out the rationale and requirement for financial support. The ESG can pay a total of €2,500 in any 24-month period. You must be able to make a matching contribution of at least 10% to access grant support. You need to provide documentary evidence of the costs (quotations from at least 2 suppliers or, if a single supplier, the reasons for choosing a single supplier)”.
They list eligible items for grant support: accountancy and related services, including legal advice; advertising and marketing aids; business equipment; business training or mentoring; business registration costs and fees; compliance, guidance and training; job-specific tools and equipment; office supplies and stationery; personal protective clothing and equipment; public liability insurance costs; short-term training on book-keeping, regulation, rollout of business plan, start-your-own-business and training courses related to the start-up; signage; upgrading to premises where the premises is owned by the applicant; and website registration, related services and production.
Of course, it goes without saying, but I will say it anyway, that the primary matter you should focus on is whether or not the business is likely to be a viable enterprise in its own right – because no amount of support will save you if it’s not a runner. I wish you the best of luck.