National Insurance: What are NI and income tax and what do I pay?

Income tax is paid on earnings from employment and profits from self-employment during the tax year, which runs from 6 April to 5 April the following year.It is also paid on some benefits, external and pensions, income from renting out property, and returns from savings, external and investments, external above certain limits. The basic rate is 20% and is paid on annual earnings between £12,571 and £50,270. The…