UK Employer vs self employed

[Knguyen]

Can anyone help me distinguish the difference between an employer and self employed ?
I think self employed is a sole trader. In terms of taxation, they pay different NIC, i.e. Sole trader pays class 2 and 4 whereas employer pays class 1 on behalf of employee and class 1A for benefits

How do you decide which one is which?

Thank you very much

 

[Becky]

I think there might be some confusion here - sole traders can have employees, therefore you could be both self-employed and an employer.

As a sole trader, you are responsible for your own tax affairs, which includes paying Class 2/4 NICs. If you also have employees, then you are responsible for paying PAYE and Class 1/1A NICs etc to HMRC on behalf of your employees.

I would strongly recommend speaking to an adviser before you commence trading, and there is also lots of guidance available on HMRC's website:

HM Revenue & Customs: Starting a business

Hope this helps!