The payment of taxes can be both daunting and worrying for individuals - people are often unaware of how they should be paying tax and how much they should pay. Income tax is one form of personal tax that seems to cause particular confusion.

If you're wondering whether you should be paying income tax, then a general rule that should be adhered to is that you should be paying income tax on any money that you earn from whatever means. If you're earning money through some sort of work, then it's very likely that you should be paying income tax.

Similarly, you'll be liable for income tax if you're earning money from other sources, such as share dividend payments, interest on savings, a jobseekers' allowance, company profits and from renting property. If in doubt, then you should check with your local tax office to see what you should be paying tax on - this is one case where it's definitely better to be safe than sorry.

The amount of money that you are allowed to earn before paying tax will vary depending upon what the Chancellor of the Exchequer chooses to announce in his Budget. This amount is referred to as your personal allowance. If you are employed by someone else, then you may be lucky enough to avoid these complexities, as it is likely that your employer will calculate your tax for you, resulting in you paying the income tax directly from your earnings (this is known as Pay As You Earn, or 'PAYE' for short).

If you are self-employed or at all concerned about tax-related issues then you should contact the Inland Revenue for more information.