A Limited Company is a limited liability company whose creation and operation must follow specific rules. It is limited by shares or by guarantee, as it can be run as a private business; this means the company is legally separate from the people who run it and then has separate finances from your personal ones. This also means the company can keep the same profit even after paying tax.
PAYE & Auto Enrollment
As an employer, you normally have to operate PAYE as part of your payroll. PAYE (Pay As You Earn) is HM Revenue and Customs’ (HMRC) system to pay income tax and National Insurance contributions.
By law, every employer with at least one member of staff has duties, including enrolling those who are eligible into a workplace pension scheme and contributing towards it.This is called 'automatic enrolment' because it is automatic for staff – they don't have to do anything to be enrolled into a pension scheme, but it is not automatic for employers.
A self-employed individual does not work for a specific employer who pays them a consistent salary or wage. Self-employed individuals, or independent contractors, earn income by contracting with a trade or business directly. In most cases, the employer will not withhold taxes, so, this becomes the responsibility of the self-employed individual.
TAX & MTD
Income Tax is a tax you pay on your income. You do not have to pay tax on all types of income.
Making Tax Digital is a key part of the government’s plans to make it easier for individuals and businesses to get their tax right and keep on top of their affairs - meaning the end of the annual tax return for millions.