In this section:
- Tax for the employed
- Tax for the self-employed
- Work out if you're employed or self-employed
- Starting your first job: what to do about tax
- Tax on casual, part-time or temporary work
- PAYE forms: P45, P46, P60, P11D
- Tax on company cars and other benefits
- Tax on employee share schemes
- Tax on tips and bonuses
- Tax when employing people in your home
Work out if you're employed or self-employed
Whether you're employed or self-employed depends on the terms and conditions of your work. It's important to know your employment status because it affects employment and benefit rights, and how you pay tax and National Insurance.
On this page:
Basic checks to help you decide
You can usually work out your employment status by asking a few straightforward questions.
You are probably self-employed if you:
- run your own business and take responsibility for its success or failure
- have several customers at the same time
- can decide how, when and where you do your work
- are free to hire other people to do the work for you or help you at your own expense
- provide the main items of equipment to do your work
You are probably employed if you:
- have to do the work yourself
- work for one person at a time, who is in charge of what you do and takes on the risks of the business
- can be told how, when and where you do your work
- have to work a set amount of hours
- are paid a regular amount according to the hours you work, and get paid for working overtime - even if you do casual or part-time work, you can still be employed
You can also be employed and self-employed at the same time, perhaps by working for an employer during the day and running your own business in the evenings. Think about each contract separately - you may find that you are self-employed for one but employed for another.
If you're unsure, you should ask to talk to a member of the Employer Support Team at your Tax Office. There's no legal definition of employment or self-employment, so if there's doubt about someone's status the decision is made by referring to previous judgments - known as 'case law'. Whether you are employed of self-employed depends upon the facts of your working arrangements, what your contract says or a combination of both.
Learn more about working out your employment status
If you are self-employed
You are responsible for your own tax and National Insurance contributions. This means telling HM Revenue & Customs (HMRC) about your income by filling in a Self Assessment tax return.
You must register as self-employed with us within three months, or you could pay a penalty.
You can download a registration form from our website using the link below, or you can register by phoning the Newly Self-employed Helpline on Tel 0845 915 4515 open from 8.00 am to 8.00 pm, Monday to Friday and 8.00 am to 4.00 pm, Saturday and Sunday.
Get the self employment registration form (PDF 45 K)
Depending on what type of National Insurance contributions you pay, you may lose the right to certain benefits, statutory payments, employment rights and the additional State Pension.
More about National Insurance contributions from the Directgov website
If you are employed
If you are employed your employer is responsible for deducting and paying your tax and National Insurance contributions through the PAYE (Pay As You Earn) system. You are also entitled to certain rights and benefits, such as maternity or paternity leave, sick pay, Jobseeker's Allowance if you lose your job and a State Pension - including the additional State Pension - when you retire.
