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Untangling new GMS arrangements for superannuation

Dr Bob Button reckons the superannuation arrangements are the most complex in the contract – here he clarifies some key changes

Of all the developments in the new contract I would suggest the superannuation arrangements are by far the most complex. I will attempt a summary you can follow up with more detailed advice depending on the area that interests you.

GP contractor practice

In the past, superannuation was based upon an individual's income in the practice. In the future it will be based on the profit of the practice. Whether this is a better system for GPs will depend upon the profitability of the practice.

The immediate effect is that the practice will be assessed for its estimate of profit for the year as of now, and this figure, once agreed with the PCO, will form the basis of the 'notional' amount to be deducted from a practice's global sum each month during that year for its superannuation contributions. This will be 6 per cent in respect of the employee element for GPs, with the 14per cent employer contribution paid by the PCO.

The final profit figure will only be determined once the accountant has adjusted practice income by removing the expenses element. This will not occur until some way into the following financial year. Then a final accurate calculation of the superannuation deductions can be made and correcting adjustment made.

Although the superannuation benefits are earned as a practice they are attributed to each of the partners according to their individual profit shares. Should the practice find its income is going to be greater than originally assessed, then the deductions for superannuation may be adjusted during the year. Regular communication with the PCO will make this an easier process.

The practice will also be responsible for organising the arrangements concerning any employee doctors it may have.

All doctors who are employed by the practice will be treated as assistants. This includes those on flexible career schemes, retainees, and returners as well as salaried doctors. You need to let the PCO know in April each year exactly who is employed as a GP performer in the practice so the relevant amounts may be deducted from your global sum. Should you take on more GP performers during the year you should let the PCO know so it can keep the figures as up to date as possible.

GP registrars

These are considered to be training grades, and as such practices are required to deduct the employee elements of superannuation only and transfer them to the PCO. The PCO will make its own arrangements with the postgraduate deanery for the deduction of employer contributions.


These continue very much as now, with the PCOs being responsible for the employer element of superannuation. The claim form, which must be used by locums, is GP SOLO. It is not available yet but will soon be downloadable from as well as being available from PCOs or primary care agencies.

GP contractor (as individual)

When GP partners work individually, for an out-of-hours provider for instance, then they are effectively acting as locums. They could also have regular employment of another sort, or if they are part-time in a practice be locums outside the practice.

In this case this other employer of the individual contractor is responsible for deducting the employee and employer contributions and remitting these to the PCO. They will then be credited to the individual, after tax deduction has been allowed for. The form GP SOLO is used in this case as well by the individual doctor.

Out-of-hours providers

These, if they are non-profit making and consisting mainly of doctors, such as an ordinary co-op, may be considered as NHS bodies for the purposes of superannuating their workers.

A GP who works for them individually will therefore be entitled to join the pension scheme and have superannuation calculated as a member of the NHS pension scheme. This will mean the out-of-hours provider will be responsible for deducting both the employer's and employee's contributions and passing them on to the PCO.

If a practice contracts with an out-of-hours provider, then any earnings are

paid to the practice gross. The practice then adds them to its practice profits and the superannuation is calculated in the same way as the other elements of its NHS work.

This whistlestop tour only scratches the surface of the detail, but I warn you the detail is not the most riveting read.

Bob Button is chief executive of Wessex LMCs

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