What is income tax?
Income tax is money taken out of your earnings. Unless you're self-employed, your employer takes out the income tax before you get paid. The main types of income tax are:
- pay as you earn (PAYE) - money taken out of your salary or wages by your employer
- tax on schedular payments (formerly withholding payments) - same as PAYE, but it's taken out of money you earn as a contractor or casual worker eg pamphlet deliveries.
