Accountants for UK HealthCare Industry

Among the most highly qualified healthcare professionals ‒ GPs, specialist doctors, dentists, and surgeons, for example ‒ a prospective liability of tax at 40% or 45% is the expectation. Doctors tax is particularly complex, involving unique issues such as NHS pension schemes, private practice income, and GP practice accounts, making specialist knowledge essential for accurate compliance and planning. There is also a significant risk of tax code errors, which can lead to incorrect payroll deductions and issues with NHS pension contributions, so accurate payroll management is crucial.

The NHS pension scheme itself presents unique challenges for tax planning, requiring a deep understanding of its rules and implications. Understanding the NHS pension and managing NHS pension tax charges is vital, as these can have a significant impact on a doctor’s overall tax position. The annual allowance is another important consideration in retirement planning for medical professionals, as exceeding it can result in unexpected tax charges. Navigating self assessment and self assessment tax returns is often complex for doctors, especially when dealing with multiple income streams and pension contributions, making expert help invaluable.

Trying to avoid declaring income is a definite no-no; there is no point, especially when there are some compliant means to pay less tax without resorting to aggressive avoidance that could land you in trouble, and particularly in light of recent HMRC tactics to crack down on undeclared income by healthcare professionals. Tax advisers play a crucial role in supporting healthcare professionals with these complex tax issues.

For example, in 2010, HMRC launched a campaign encouraging doctors and other medical professionals to declare their unpaid tax. The campaign raised total revenue of more than £64 million. Bear in mind also that over the last five to eight years, HMRC has grown in power and is able to demand “bulk” information from businesses or government agencies. When in 2008 HRMC started homing in on the medical profession, it acquired information from NHS trusts, private hospitals, and specialist medical and insurance companies to test suspicions that practitioners were failing to declare fees for consultations, medical examinations, and other services.

Tax rebates

There are specific tax rebates for healthcare workers that should definitely be exploited. Across the healthcare profession, many workers are eligible to claim extra tax relief for expenses incurred as part of their job. This element of tax relief alone can add up to hundreds of pounds. It can only be reclaimed by submitting a claim to HMRC, so if you haven’t done so, you should do immediately, and remember that you can backdate the claim for the last four years.

Uniform-cleaning allowance

If you wear a uniform for work and launder it yourself, you can claim a flat-rate tax allowance every year for the cost of cleaning your uniform. The amount depends on your occupation, but can amount to as much as £100 a year without any need to provide receipts or any proof of the actual costs.

Shoes and stockings/tights allowance

An allowance of £12 per year can be claimed if you are required to wear special types of shoes (e.g. non-slip) in the workplace. If you are required to wear stockings/tights/socks of a particular colour, then you can claim additional tax relief of £6 per year.

HealthCare Industry Tax & Accounting

Exam fees & professional fees and subscriptions

Following an agreement between the Royal College of Surgeons and HMRC, trainee surgeons, contracted as speciality or core trainees, and who pay the MRCS exam fees themselves, are now allowed to claim tax relief on exam fees. You can also claim 20% of the cost of fees to professional bodies or unions such as Unison, RCN, NMC, HCPC, or SSSC. Likewise, if you pay professional indemnity insurance (i.e. Medical Protection Society) you can claim tax relief on these costs annually.

Mileage allowance relief

You can claim the scale rates for mileage if you use your own car for work-related journeys or to attend professional courses. If a colleague travels with you, there is a further allowance of 5p per mile. Check the HMRC scale rates and note that they do change from time to time. At present, you can claim up to 45p per mile for each business journey you make – for example, if you pay visits to patients at home. If you receive less than 45p per mile for from your employer, you can claim tax relief on the difference from HMRC.

Equipment purchase

For any equipment bought solely for work purposes you are entitled to make a claim for the cost; usually proof of purchase evidence is required, so maintaining records is essential. See how easy Nomi ‒ our bookkeeping and accounting software on the cloud ‒ makes saving receipts: watch the video.

Incorporation expenses

Expenses involved during incorporation of a business can be claimed back for up to seven years before the company started up providing that they were incurred wholly and exclusively in the course of setting up company for which the expenses are being claimed.

For limited companies, it is essential to file accounts with Companies House and complete Corporation Tax returns as part of ongoing compliance requirements. Filing these documents is a statutory obligation and ensures your medical practice remains compliant with legal and regulatory standards. If you are considering switching from your current accountant, it is important to change accountants to a specialist who understands the unique financial needs of medical professionals and can facilitate a smooth transition.

Healthcare professionals are you aware of the plethora of tax changes for 2016/17 and all the many tax-planning opportunities open to you? We ensure that healthcare professionals exploit all opportunities to lower their tax liability compliantly in every respect, whichever way they work. For added peace of mind, we offer a fixed fee quote for incorporation and ongoing services, so you always know what to expect.