Current and former GP partners who own a share in a surgery building could be faced with an unexpected tax bill of up to £100,000, legal experts have warned.
Retiring GPs could be liable to pay tens of thousands of pounds worth of Stamp Duty Land Tax (SDLT), a tax on property purchases that can be triggered when a surgery becomes a partnership asset and also when it later ceases to be a partnership asset, lawyers at specialist healthcare firm DR Solicitors said.
They added that GP partners were facing bills ranging from £10,00 to £100,000 because of this issue. It comes as GP partners are increasingly reluctant to buy into properties, with many now looking to sell-off properties and then lease them back from companies which will manage the premises.
DR Solicitors said that up to half of all GP surgeries are thought to belong to current or former partners, meaning hundreds of GPs could face paying this additional charge.
Daphne Robertson, senior partner at DR Solicitors said: ‘The problem arises when partners regard themselves as property owners and forget that the building is actually a partnership asset.
‘When the building leaves the partnership through retirement or dissolution it is treated as a sale for SDLT purposes, even when there is only one legal owner.’
All partnership property transactions since 2003 are affected and the amount due is dependent on the value of the building, among other factors.
SDLT is a self-assessment tax, which means it is the responsibility of the individual to declare it. The consequences of not doing so include the risk of significant financial penalties, in addition to the tax due and interest for late payment, the solicitors warned.