Locums risk falling foul of tax legislation

GPs locums and practices are running the risk of landing unexpected tax bills by not complying with tax legislation.

The warning, from contractor accountant firm Brookson, comes at the end of a year in which HMRC collected £9million in unpaid taxes from just 1500 medical professionals.

Experts are now warning GPs face a rise of £10k a year in tax bills.

With changes to PCT funding meaning that GP locums will be under even greater financial burden, Brookson, which specialises in accounting services for contractors, is looking to spearhead compliance in the medical industry by giving GP locums the advice they need to avoid unexpected tax bills and the potentially damaging reputational impact to their practice.

Martin Hesketh, managing director of Brookson, said:

"It is clear that GP locums and practices are coming under the spotlight and working practices need to be 100 per cent compliant. HMRC is placing a strong focus on VAT, the declaration of business expenses, pensions and the employment relationship that exists between the practice and the locum.

"Brookson have long been regarded as the employment status experts for independent workers. As HMRC turn their attention to the medical sector we are now looking to help promote compliance and provide guidance on employment status, promoting stability and longevity within the locum marketplace. Practices failing to ensure the employment status for locums they appoint is managed correctly could face substantial financial liabilities of unpaid tax and NIC, and embarrassment for all parties involved – exemplified by the large amount of taxes repaid this year from the sector."

According to accountants for contractors Brookson many GP Locums use traditional high street accountants for their tax affairs; however with HMRC examining the working relationships of locums this is not something the industry is prepared for and our experience and research shows that many locum relationships are actually at risk of being seen as disguised employees by HMRC.

Brookson advises that complex IR35 tax legislation means accounts and working practices must be reviewed at more regular intervals with specialist help on IR35 compliance. Brookson’s free guide to accounting explains IR35 compliance, employment status and what it means to you.

Brookson is helping to increase standards across the independent worker marketplace by co-founding the Freelancer and Contractor Service Association (FCSA) which has developed a code of conduct for members to help drive compliance across multiple business sectors in line with HMRC legislation.

-ENDS-

For more information, please contact Victoria McDonnell at Brookson Ltd.

Email: victoria.mcdonnell@brookson.co.uk

Notes to Editors:

Brookson provides accountancy, tax and support services for self-employed professionals working on an umbrella basis, or running their own business either as a sole trader and or via their own limited company.

Brookson was launched 15 years ago ‘by contractors, for contractors’ to provide advice and support to self-employed individuals to ensure they access the benefits they are entitled to, while working compliantly. Managed by a highly-qualified team of chartered accountants and former contractors, Brookson is committed to providing a first class service to its customers.

The independent worker market is highly legislative and the taxation side can be very complex. Throughout its 15 year history Brookson has used its specialism in independent working to guide its customers through the many changes in legislation, always ensuring they are operating compliantly whilst also optimising their tax position.

We are currently working with the BMA and Vocational Training Schemes to create a service for Locum GP’s to ensure longevity and compliance within the market place and are now looking to engage with GP practices and Locums directly.