Doctors / GPs

Tax planning around IR35 for doctors and locums

simon

Simon Misiewicz

11th November 2017


Article relevant to the tax year 2019-20

Are you up-to-date with IR35 rules and regulations?

The government has long disliked these arrangements, and the IR35 rules were introduced in April 2000 to try to counter this perceived avoidance. HMRC estimated that the cost of non-compliance in 2016/17 was £440m.

As HMRC does not have an appeals process for anyone deemed to be wrongly inside IR35, legal action is the only option. I predict that this initial case could be the tip of the iceberg for medical professionals.

There are question marks about whether the NHS is taking reasonable care in assessing IR35 status, as the law requires them to do, so I encourage medical professionals to ensure that their NHS Trust has a clear internal appeals process.

Some additional research suggests that medical professional contractors have decided to vote with their feet.

A survey by the Association of Professional Staffing Companies, for example, highlighted that 70% of recruiters had seen a fall in overall public sector contractors since April, while 45% had also seen evidence of contractors increasing their rates since the rule change.

What is abundantly clear is that this is a complex period of change for NHS trusts and medical professionals, and it’s critical for locums, doctors and dentists to utilise effective tax planning advice.

By now you would have noticed that the number of tax changes means that you need to plan for the future to ensure that you keep more of what you earn.

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