Do i need to pay myself!?

[Martin at NixonWilliams]

Would you not need PAYE to do a P11D to be able to reclaim expenses?

You don't need a PAYE scheme to reclaim expenses.

You may need a PAYE scheme if you have expenses that are required to be reported on a P11d. The most common is travel, however this does not include mileage, which is not a reportable expense provided it is claimed in line with the statutory rates.

[d000hg]

Given there is an element of "secrecy" and a self admitted possible conflict of interests you might be as well to ensure you are not in breach of your contract of employment.

If it is the case this is potentially going to have comeback through disciplinary action etc should the employer discover what is going on.

It's more normal to tell your employer you're doing a side project in your weekends so they approve it and cannot later pull the "we own everything you do while in our employment" trick.
Unless you're competing it should be a formality really.