ESA permitted work rules and setting up a charity

Client is in ESA support group and wants to set up a charity and apply for grants etc. She is hoping in the long run to make an income for herself from running the charity - she is 18 and has recently been discharged from long term hospitalisation for an eating disorder and wants to set up the charity to promote awareness of eating disorders. She is very interested in the media and has been directed by her care co-ordinator towards agencies for advice on the actual setting up of a charity and the legislation involved around grants etc so it looks like a very positive move for her generally but she is concerned about the effect on her benefits.

I am assuming that aside from any charity law requirements,  any income would still come under the permitted work rules - is this right?

See p.1042 CPAG 2015/16 which deals with permitted work.

If the work is being done as “part of a treatment programme” under medical supervision whilst regularly attending hospital as an outpatient, then provided she earns no more than £104 p/w she should be fine.

Alternatively, whilst she remains in the support group, she could do permitted work indefinitely provided she works, on average, less than 16 hours a week and does not earn more than £104 p/w.

Whilst those rules do appear relatively straightforward, experience does suggest a note of caution, as I have seen apparently unprompted reassessments taking place when DWP have been notified of permitted work arrangements taking place. Of course, there is no requirement to notify DWP in legislation but again, experience suggests that it is often better to do so to avoid their jumping to erroneous conclusions.

I would hazard that setting up, running and funding a charity on your own is probably going to take substantially more than 16 hours a week in any case.

However once the charity exists as its own legal entity, I would imagine she would be able to reasonably volunteer her services to it without payment for a longer amount of time without impacting her benefits. That might be a better option at least until things become established.

As Paul says, I would be concerned about re-assessment. Establishing a charity on your own and obtaining funding is a pretty mighty undertaking and is likely to create a presumption, rightly or wrongly, that you could manage in a workplace.