Chris Thorpe outlines some tax issues for consideration by employers when taking on staff.
With the growth of a business will come the need for more people to service the growing number of clients and customers.
When it comes to employees, a plethora of employment laws needs to be considered (especially once the Employment Rights Bill becomes law later in 2025), but the tax consequences also need to be considered.
An employee?
The first and most important question is whether the individual hired is actually an employee, as opposed to a contractor. If they are an employee, the employer has to operate a PAYE scheme and pay the income tax and National Insurance contributions (NICs) on the salary to HMRC; indeed NICs are the major distinction between taking on employees and engaging contractors – the employer is liable to secondary NIC’s at 15%, a
