If you pay an employee less than £113 a week, you usually only need to record and report their pay (unless they have another job or receive a pension).

Even if the "employee" is earning less than minimum PAYE/NIC threshold you still will have to be registered and complete regular Paye returns and P60 end of year

Are you sure? Suspect that's the significance of the £113 figure - below that there's no tax or NI payable, so no need to go the full monty PAYE rigmarole.

But as you say, declaring £120 would bring him into the PAYE system, thus a whole lot of paperwork and hassle best avoided.

If you employ anyone you should register as an employer as you need a PAYE reference for employers liability which you must have

The trouble is with cash-in-hand is when you get older and realise you haven't got enough NI contributions for a state pension.

Someone who used to work for me when i had a bus company in London (on the books) told me his mrs was rushed into hospital with something serious. She'd worked in a pub for years. Tried to claim sick pay, but they said she'd never paid anything in to National insurance so couldn't get any benefits at all. It goes to show..

if she had paid S/E NIC for 60 years she still wouldnt get SP as we cant claim it - its not paid to self employed

Since when?

If you can't work because you are sick or disabled, whether temporarily or permanently, you might be able to claim Statutory Sick Pay (SSP) or Employment and Support Allowance (ESA). Usually, SSP is paid for the first 28 weeks of sickness if you work for an employer. Otherwise, you should claim ESA.

ESA if you can't work because of sickness or disability. ... You might be able to get ESA if your Statutory Sick Pay (SSP) has run out or you can't claim SSP. For example, because you're: Self-employed.

Statutory Sick Pay (SSP) is paid by an employer when an employee is unable to work due to sickness. If you are self employed you cannot get Statutory Sick Pay as you are working for yourself and therefore do not have an employer.