New Enterprise Allowance

new enterprise allowanceThe New Enterprise Allowance

Start-ups are not my normal area of expertise, the majority of our business comes from more established companies or property professionals. However, this is a scheme that continues to sit under the radar and really should have a higher profile.

The New Enterprise Allowance(NEA) is a Government scheme that supports those who have decided to start their own business rather than seek employed work. In a gig economy the self-employed route is becoming ever more popular.

The way the scheme works is like this:

  • Attend an initial workshop to help you decide if self-employment is the right option
  • Get a business mentor to help you develop your business idea and start trading
  • Get a weekly allowance paid for up to 26 weeks (up to a total of £1,274)

The caveat is that you need to submit a business plan and have it approved. No great shakes with that as every new business needs to be thought through and planned. This requirement is to weed out the businesses that will never start, it should ensure the scheme runs with some integrity, and hopefully some longevity.

You need to be working 16 hours a week in (or on, to quote my business coach) your business.

Start-Up Loans Company vs NEA

The big difference between these schemes is that the NEA provides a regular small income to support you in starting up your new business, whilst the Start-Up Loan scheme is a straight loan that charges interest and needs to be repaid.

The NEA does not need to be repaid.

For many people starting up for the first time the NEA is a small contribution to support you in the early days, it won’t change the world but it will help a little. For anyone who has started their own business then they will know every little is very much appreciated.

Claiming the NEA does not prevent you from using Start-Up Loans scheme, in fact you would already have the business plan so the process may even be more straightforward.

For more information on the NEA then follow the links above. The application process changes so check the .gov website for how to apply and where to submit your business plan.

The infographic below is from 2014 but still relevant.

If you are eligible then check out the NEA, it is something that many new business owners could be eligible for but just don’t know it exists.

By Dave Farmer

 

new enterprise allowance

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