You are required to register as an employer with HMRC and set up a PAYE scheme before your first payday, but no more than two months before that payday.
If your only income is a single private pension taxed under PAYE and HMRC has issued the correct tax code, the system handles it without you having to do anything.
Most everyday groceries are zero-rated for VAT, but a wide range of everyday items, including hot takeaway food, confectionery, drinks served in a café, and food eaten on the premises, are taxed at the standard rate of 20%.
The UK uses a progressive, marginal tax system. This means that as your income rises, each additional slice is taxed at a higher rate, but only that slice, never your entire income.
Paying below the National Minimum Wage is not a technical breach that quietly slips through the system. It is a criminal offense, triggers automatic penalties of up to 200% of any underpayment.
A sole trader claiming £1,000 of expenses at the basic rate saves £200 in income tax. A higher-rate taxpayer saves £400.
Statutory Sick Pay (SSP) is the minimum amount an employer must pay to an eligible employee who is off work due to sickness.
An HMRC investigation is not an accusation of fraud. Most inquiries arise from data matching, statistical analysis, or random selection, and many are closed without any adjustment to the tax position.
Salary sacrifice, also called salary exchange, is an arrangement where an employee agrees to give up part of their gross salary, and the employer pays that amount directly into their pension.