PAYE for Freelancers: What You Need to Know

As a freelancer, you need to be aware of all the different types of tax you’ll have to pay. One type is PAYE (Pay As You Earn) — a system that makes sure the right amount of income tax is deducted from your salary. So what exactly do you need to know about PAYE as a freelancer? Read on to find out.

Who does PAYE apply?

PAYE applies to anyone who earns money from employment, including freelancers and contractors. If you’re registered as self-employed with HMRC, then PAYE won’t apply because your taxes will be calculated differently usually through Self Assessment during ‘Tax Return season’ at the end of each financial year. However, if your clients treat you like an employee, or if they deduct taxes from your pay before giving it to you, then this means that PAYE does apply to you as well.

It’s important that all freelancers understand whether they are eligible for PAYE or not so they can ensure their taxes are paid correctly and on time.

How do I register for PAYE?

If your clients deduct taxes from your pay before giving it to you, then this means that they are registered with HMRC as an employer and will take care of registering you for PAYE on their behalf so there’s nothing else required from your side! However, if they don’t deduct anything from your paycheck then it may be up to you as the freelancer/contractor to register yourself with HMRC directly using their online services portal or contact them by phone or post if needed.


PAYE can seem confusing at first but understanding the basics about how it works can help ensure that all of your taxes are paid correctly and on time! Knowing which system applies to freelancers either Self Assessment or PAYE is essential in order for them to stay compliant with their tax obligations and avoid any hefty fines down the line. It’s always best practice for freelancers in the UK to make sure they’re aware of both systems so they know what needs doing when it comes time to pay their taxes!

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