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Independents' Day

GPs doing out-of-hours shifts ‘being targeted’ by tax inspectors

Exclusive Out-of-hours GP providers are being targeted by HMRC in a crackdown on employment status, with the threat of tax tribunals for some groups, out-of-hours groups have told Pulse.

Urgent Health UK, which represents out-of-hours groups, said that the taxman was ‘actively pursuing’ its members for historic tax liabilities which one group said could amount to a 30% hike in its costs.

It comes as out-of-hours groups are already struggling with high indemnity costs, which is making it hard to recruit, and having to compete with seven-day GP access schemes.

HMRC is questioning whether out-of-hours GPs should be classed as ‘employees’ rather than self-employed.

Self-employed GPs can claim tax relief on certain expenses and may benefit from lower national insurance and pension scheme contributions, while the organisations themselves pay lower National Insurance employer contributions.

But HMRC claims that out-of-hours GPs are claiming to be self-employed when they are de facto employees, because they are subject to the same control and directions from their managers as standard employees.

It has written to a number of doctors working for Bristol out-of-hours group Brisdoc as self-employed doctors to ask if they would be prepared to go to a tax tribunal so the court can determine their employment status.

The executive chairman of Brisdoc, Dr Ray Montague, says they have been visited two times so far by HMRC without committing to a ‘verdict’, which is creating uncertainty.

Dr Montague added: ‘It feels like HMRC is on a mission to prove this is a case, whether a case exists or not. From a legal standpoint, the potential undermining of the primary urgent care sector that could follow from this approach is not their problem, and nor it seems is it anyone else’s.

‘NHS England and commissioners have shown no sign of being willing to share the risk.’

Chief executive of Urgent Health UK Dr John Horrocks said: ’[HMRC] detects that with the extra requirements put on GPs in the work they do, they are moving more and more towards employee status, because there is more control exercised on them in one way or another.’

Dr Simon Abrams, chair of Urgent Health UK, said that HMRC was ‘actively pursuing’ this and that out-of-hours providers stood to face severe financial penalties if their practitioners had been incorrectly labelled for tax purposes.

One out-of-hours provider estimated that it would face a 30% hike in its costs if the self-employed GPs it worked with were re-classified as employed by the organisation, he added.

Dr Abrams said: ’With this sort of rise in costs all OOH providers would be crippled.’

Tax experts confirmed that out-of-hours doctors were facing increasing scrutiny over their tax status, but said that the responsibility for determining their status lay with providers.

Bob Senior, head of medical services at Baker Tilly and chair of the Association of Independent Specialist Medical Accountants, said: ’The out of hours organisation would have to pay 13.8% employers National Insurance contributions on any income over £155 per week.

’That would be a significant cost and I would not be at all surprised if the OOH organisation sought to reduce the rate they pay for the sessions to effectively cover that cost so that they remain cost neutral. That is probably the most significant point for GPs since if that happened they would be seeing a significant pay cut.’

Deborah Wood, a healthcare services partner at accountancy firm Moore and Smalley, said: ’If they have been incorrectly classed as self-employed in the past, HMRC will instruct the OOH organisation to reclassify them as employed and to retrospectively correct the error for earlier years. Significant sums can be involved.’

HMRC has denied that it is specifically targeting doctors, but said it continually worked to ensure that tax status rules were adhered to.

A spokesman for HMRC said: ‘Employment status is never a matter of personal choice and is always dictated by the specific facts. When the employment relationship does not accurately reflect the underlying reality, the wrong tax is paid then we intervene to ensure the rules are applied as intended by Parliament.’


Readers' comments (27)

  • Move 1: blow to the neck= propaganda
    Move 2: kick to the knee= financial cuts.
    Move 3: elbow drop to the temple= demoralize workforce even further.
    Result: dead NHS

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  • Many OOH providers wanted GP`s to be self employed and went from automatic pay to asking GP`s to invoice as per IR35 checklist.

    Given the paymaster is a private company, the GP`s are working elsewhere as the "main" occupation and are on "zero hour" contract with the OOH companies with "no show -no pay" policy and "substitution policy" i.e. many OOH organizations say "the shift is flexible to work in base, telephone or visiting in any of their local bases" all point towards self -employed status.
    However some GP`s work almost exclusively for a single OOH provider in which case it maybe more complicated.

    If this is settled in Tribunal against doctors, watch OOH collapse overnight as given the OOH indemnity costs of £15-£30/hr, Gp`s already in 40-45% tax bracket, NI (both employee and employer) - will have to pay up to £75.5 per£100 back to government ($5% tax, 8.5% NI, 22% Pensions) and then pay up to £20 for medical indemnity.
    So working to pay up to £95.5 out of each £100 earned would make it harder to find doctors!

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  • No sick or annual leave = nothing remotely like being an employee, but maybe you are the worst of all worlds

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  • This is happening across lots of sectors particularly IT

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  • My local OOH provider is already fighting for survival. They have lost more than half their GPs. They are forced to use untrained paramedics to man PCCs. The workload and toxic environment is driving the remaining GPs away one by one. Now targeting by tax inspectors will be the final blow. Well done tories for a well executed plan. Evil geniuses.

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  • With the litigation, medico legal risk and other problems like the entitled patients, why on earth would anyone even consider working for out of hours in this day and age. The day job with all the notes is bad enough.

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  • Why the worries, let OOH collapse and publicise the fact that it did so because NHSE would not fund it, then let the public decide if they are willing to pay or not.

    GPs. please stop trying to find ways to prop up an inadequately funded service from your own time/finances. Just all quit and force the issue.

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  • Destroy OOH and force us into 7 day working . All part of the Tory plan .

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  • When they try and force a change we need to stand up to the bulllys like the juniors did either individually or/and together .

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  • 7 day working is coming up rapidly, like a bad kebab on a Friday night. The Manchester Muppets are at the front of the queue. CCGs already earnestly discussing plans for 'federations' to cover weekends and evenings, like a bad Co-op with all local GPs liable to work shifts but no money to pay them. Wrecking OOH providers is part of the plan. The floggings will continue until morale improves.

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