Clear and hassle-free advice for GPs
Doctors
Clear and hassle-free advice for GPs
Shipleys have been using their specialist knowledge in the healthcare sector for over 10 years. We act for GPs practices of all sizes from small single handed practices to larger partnerships and corporates, as well as Pharmacy linked GP practices, health clinics and consultants.
The health industry has seen a surge in growth in recent years, achieved against a back drop of challenges from fundamental reforms to the NHS. GPs need to be proactive with their business model and look to provide more of the advanced and enhanced services on top of essential services to maintain incomes and profitability.
Sections
- GPs Principals and Practices
- GP Locums, Registrars and Consultants
- Tax planning services for Doctors
GPs Principals and Practices
At Shipleys Tax we understand the specific needs of general practices and the partners involved. Fundamental reforms to the NHS mean GP practices need to continuously re-position themselves under the new system and be able to devote maximum time to administration of patient care. This is where our team can help by providing specialist knowledge on streamlining accounting and tax matters leaving GPs to concentrate on patient care.
Why do you need a specialist GP accountant?
• Knowledge of NHS general practice and the expert advice we provide can be instrumental
• Understanding how practices are funded (from global sum to QOFs ).
• Be familiar with the GP contract reforms, GMS statement of financial entitlements, PMS contracts and the NHS pension scheme.
• Be up to speed on practice based commissioning (PBC), APMS contracts and the developing primary care market.
• Deal competently and promptly with all taxation matters and with GPs’ superannuation.
Why us?
We aim to do more than produce the annual accounts and handle the partners’ tax affairs.
Personal service – you will deal with one particular partner and their same support team and not be passed around
Timely – the annual accounts will be prepared to agreed time scales and we will visit the practice to discuss
Prompt – we will deal promptly with routine queries, telephone calls and emails and advise on bookkeeping, cash flow and monitoring partners’ drawings without making additional charges.
Tax planning – we will discuss ways to minimise your overall tax liability and spot opportunities.
We have nationwide coverage and are happy to come and visit you.
Cost
What our basic annual fee covers:
• Annual accounts preparation.
• Meeting GPs to discuss draft accounts.
• Partnership tax return and tax computation..
• Advising on projected profits and tax liability.
• Dispensary accounts.
• Partners’ personal tax returns.
• GP certificate of NHS pensionable income.
• Ad hoc email and telephone queries
• Opportunities for tax planning for both business and personal affairs
We also advise on:
• VAT accounting.
• Setting up a limited company for non-NHS or locum income.
• Setting up a limited company social enterprise for PBC/APMS purposes.
• Handling HM Revenue & Customs’ investigation into the practice.
• Payroll
• NHS superannuation
• Specific tax planning strategies for reducing IHT, CGT and Stamp Duty
GP Locums, Registrars and Consultants
We have acted for GP Locums, Consultants and Registrars for many years and understand the needs of the medical profession.
As a GP Locum, Registrar or consultant you have very specific accounting and tax needs which may not necessarily be appreciated by a non specialist advisor.
What does the service include?
• Advising on employed vs self employed status and NIC implications
• Proactive advice on tax allowable business expenses, professional subscriptions and general tax planning for locums
• Advice on employing a spouse
• Preparation of annual Accounts and tax returns for HMRC
• Ad hoc telephone and email advice
As well as providing accounting and income tax advice we can also advise on the following areas:
• Incorporation of your business via a limited company
• Advice on tax treatment of superannuation
• Advice on completing superannuation certificates (GP solo, Forms A&B)
• Inheritance tax planning
• Property tax planning
We have nationwide coverage and act for GP Locums, Registrars and Consultants clients based throughout the UK.
Why us?
• Save you money – proactive services ensuring you are aware of tax savings
• Knowledge you can rely on – we have a wealth of tax expertise in the healthcare sector
• Planning – ensuring you are aware of tax liabilities and payment dates enabling you to plan your cashflow
• Peace of mind – we have many years of experience in dealing with the tax affairs of medical and hospital consultants
• Help you minimising risk of HMRC enquiry
Our fees start at £345 + VAT
Tax Planning for Doctors
Tax law never stands still and goal posts are always moving. It is crucial that you have the right adviser to guide you through the maze and help reduce your tax bill through legitimate and transparent means.
Shipleys Tax has a number of specialist tax advisers with wealth of experience in the medical sector who can talk to you about the many tax saving opportunities.
We always say the best tax planning is done before a major event in the business so seek advice early on in the lifecycle of a transaction. Some areas to consider:
• Buying or Selling a GP practice property – huge tax saving opportunities both personal and corporation tax (NB: patient lists cannot be sold)
• GP linked pharmacies – most tax efficient trading structures
• Reduce inheritance tax on death
• Reduce stamp duty land tax on buying
• Offshore tax planning advice for certain businesses
• Provide property development strategies
• Use of EIS/SEIS and corporate venture vehicles
• Use of LLPs and corporate partnerships
• Asset protection and preservation of wealth
• Estate planning and succession
Latest news & blogs…
Tax planning with Shares and Spouses
WE CHERISH OUR partners for a multitude of reasons, yet tax planning rarely ranks among the top. Nevertheless, in light of the unprecedented tax burden faced by taxpayers today, planning with shares and spouses can be a valuable tool for both individuals and businesses to manage their tax liabilities effectively.
In today’s Shipleys Tax article, we explore some of the basic considerations for tax planning with shares and spouses and the traps that one should avoid.
Shares and Spouses
One of the most common tax planning strategies involving shares and spouses is the transfer of shares between spouses. This can be done to take advantage of lower tax rates or to transfer ownership of a company or business. By utilising tax free allowances by paying a spouse a small salary, usually up to the primary threshold, so as to incur no PAYE or NICs but still maintain entitlement to state benefits and the state pension. The company gets corporation tax relief on the salaries, and earnings are then topped up by dividends.
However, it is essential to understand the tax implications of such transfers and to ensure that they are done correctly.
One of the most common tax planning strategies involving shares and spouses is the transfer of shares between spouses
Firstly, when transferring shares between spouses, it is important to consider the capital gains tax (CGT) implications. In the UK, CGT is a tax on the profits made from selling assets, including shares. The current CGT allowance for individuals is £12,300 for the tax year 2022/23. However, when transferring shares between spouses, the transfer is not subject to CGT. Instead, the transfer is deemed to take place at market value, and the new owner of the shares takes on the original cost of the shares for future CGT calculations.
Secondly, it is important to consider the income tax implications of transferring shares between spouses. Dividends from shares are subject to income tax, and if a higher-earning spouse transfers shares to a lower-earning spouse, they may be able to take advantage of the lower tax rates. However, there are rules in place to prevent spouses from using this strategy to avoid tax. The so-called “settlements legislation” applies to situations where income is transferred between spouses in order to take advantage of lower tax rates. In such cases, the income will be taxed as if it had been earned by the higher-earning spouse.
The Traps to Avoid
When it comes to tax planning with shares and spouses, there are several traps that individuals must avoid. These include:
- Failing to properly document the transfer of shares between spouses – It is essential to document any transfers of shares between spouses to ensure that the transfer is valid and to avoid any disputes with HMRC.
- Failing to consider the long-term implications of the transfer – Transferring shares between spouses can have long-term implications, such as future CGT liabilities, and individuals must consider these implications before making any transfers.
- Failing to comply with the rules on settlements – The settlements legislation can be complex, and individuals must ensure that they comply with the rules to avoid being subject to additional tax liabilities.
Dividends from shares are subject to income tax, and if a higher-earning spouse transfers shares to a lower-earning spouse, they may be able to take advantage of the lower tax rates
- Alphabet share schemes – companies may issue so-called “Alphabet shares” to spouses, which restrict shareholders voting rights, and/or their right of income to dividends, or capital on a winding up, based on performance or some other metric. Gifting or issuing such shares to such key individuals could be argued by HMRC to be “substantially a right to income”, and therefore would fall foul of settlements legislation above.
If however such shares issued under a carefully drafted alphabet share scheme, have equal and full minority voting rights applied, then broadly HMRC would not be able to attack this arrangement as a “settlement”, as always there are exceptions to this however and it is best to take professional advice.
Conclusion
Tax planning with shares and spouses can be a valuable tool for managing tax liabilities effectively. However, individuals must be aware of the potential traps and pitfalls that can arise when using this strategy. By properly documenting any transfers of shares, considering the long-term implications of the transfer, and complying with the rules on settlements, individuals can avoid these traps and ensure that their tax planning strategies are effective and compliant with tax rules.
If you are affected by any of the issues above and would like more information, please call 0114 272 4984 or email info@shipleystax.com.
Please note that Shipleys Tax do not give free advice by email or telephone.
Muted Spring Budget 2023 delivers controversial pension tax reform
AFTER THE PREVIOUS blockbuster Budgets, today’s Spring Budget 2023 announcement was bit of a damp squib. While the Chancellor’s may not have been the most exciting event, it did have some notable highlights worth mentioning.
The main focus of the speech was on incentives for working parents, older individuals, and carers, rather than on tax changes. However, it was confirmed that the corporation tax increase previously announced in 2021 will go ahead from April 1, 2023, with the main rate increasing to 25%.
In today’s Shipleys Tax note we look at the main Budget 2023 announcements.
Incentives for Working Parents, Older Individuals, and Carers
The Chancellor’s Spring Budget 2023 placed a significant emphasis on providing support for working parents, older individuals, and carers. Several measures were announced with the aim of incentivizing these groups to continue working and contributing to the economy. See here..
Pensions
Pensions were a major topic, with changes to both the annual allowance (AA) and lifetime allowance (LA) thresholds. The AA, which is the maximum amount of tax-relieved contributions that can be made in a pension input period, will increase from £40,000 to £60,000 starting in 2023/24. The LA charge will be removed for 2023/24 and completely abolished from 2024/25, instead of increasing to £1.8M as previously rumoured. The money purchase annual allowance will also increase from £4,000 to £10,000 from 2023/24.
The changes to the annual and lifetime allowances for pensions have been controversial, with some critics arguing that they primarily benefit the very wealthy. However, the removal of the lifetime allowance charge from 2023/24 is seen as a positive development for some GPs and dentists.
Many GPs and some dentists have been affected by the lifetime allowance charge, which can result in a significant tax bill for those with large pension savings. The removal of the charge is expected to provide relief for these individuals, who may have been considering early retirement or reducing their working hours to avoid the charge.
Despite the positive impact for GPs and some dentists, there is ongoing debate over the fairness and effectiveness of the pensions reforms, with some calling for further measures to address pension inequality and encourage more widespread saving for retirement.
Changes to System of Capital Allowances
In terms of businesses, there will be changes to the system of capital allowances. From April 1, 2023, until March 31, 2026, companies will be entitled to a 100% first-year allowance for capital expenditure on IT equipment and plant and machinery. The 50% deduction for special rate expenditure will also be extended during this period.
Expanding Cash Basis for Unincorporated Businesses
- There will be a consultation on expanding the cash basis for unincorporated businesses.
- This may lead to relaxations of restrictions on loss relief and the cap on deductible interest payments (currently £500).
Other announcements
Individuals:
Qualifying care relief
The income threshold at which qualifying carers begin paying tax on care income will increase to £18,140 per year plus £375-450 per person cared for per week for 2023/24. These levels will then be index-linked.
Fuel duty
The planned increase of 11p in fuel duty this year will be cancelled. For the next 12 months, rates will be kept the same.
Trusts and estates
An existing income tax concession for low-income trusts and estates will be extended. Further changes will simplify calculations and reporting. HMRC also intends to remove non-taxpaying trusts from reporting requirements by modifying inheritance tax regulations.
Businesses:
R&D tax relief
From 1 April 2023, there will be an increased rate of relief for loss-making R&D intensive SMEs. Eligible companies will receive £27 from HMRC for every £100 of R&D investment.
A company is considered R&D intensive where its qualifying R&D expenditure is 40% or more of its total expenditure.
Previously announced restrictions on some overseas expenditure will now come into effect from 1 April 2024 instead of 1 April 2023.
Cultural tax reliefs
The higher rates of the theatre, orchestra and museums and galleries tax reliefs will be extended for two years.
Creative tax reliefs
From 1 April 2024:
- A new Audio-Visual Expenditure Credit will replace the current film, high-end TV, animation and children’s TV tax reliefs
- A new Video Games Expenditure Credit will be introduced
Tax avoidance measures
- A further £47.2m investment to support HMRC’s capability to collect tax debts
- Legislation to close an avoidance loophole that can leave HMRC out of time to assess tax due on capital gains when an asset is disposed of under an unconditional contract
- From the 2024/25 tax year, changes to the self-assessment tax return forms requiring amounts in respect of cryptoassets to be identified separately
A full overview of the announcements is available here.
Using a Trust for tax planning?
TRUSTS CAN BE a very useful way to hold interests in land and property in the UK. One type of trust, called a bare trust, provides a simple and flexible way to manage and transfer property ownership and can be used in for basic tax planning. However, many people who have created such bare trusts are not aware of the HMRC registration requirements and the tax implications associated with them.
In today’s Shipleys Tax note we look at in particular what bare trusts are and the consequences of failure to register with HMRC.
What is a bare trust?
Bare trusts are often used for holding interests in land and property, as they provide a simple and flexible way to manage and transfer property ownership. A bare trust is created when a settlor transfers legal ownership of property or assets to a trustee, who holds the property or assets on behalf of the beneficiary. Unlike other types of trusts the trustee has no discretion over how the trust assets are distributed, and the beneficiary has an immediate and absolute right to the trust assets.
Bare trusts are often used for holding interests in land and property, as they provide a simple and flexible way to manage and transfer property ownership.
Trust Registration
The UK government’s Trust Registration Service (TRS) requires trustees to register details of certain trusts with the government within certain deadlines. The registration requirements apply to all trusts that have UK tax consequences, including trusts that hold interests in land or property.
Despite this, many people who have created bare trusts may not be aware of the registration requirements and the potential consequences of failing to comply. (Surveys by YouGov in 2019 found that over half of UK adults were unaware of the TRS and the registration requirements for trusts; and NFU Mutual 2018 which found that more than a third of people with trusts were unaware of the registration requirements).
Failing to comply with the registration requirements for a bare trust in land or property can have serious consequences. Trustees who fail to register the trust with the TRS can face fines and penalties. In addition, failure to register the trust can result in delays and difficulties in transferring or selling the property.
Bare trusts exempt?
Some trusts, such as those that hold only cash or simple assets, bare trusts, and those already regulated, are exempt from registration.
Trustees who fail to register the trust with the TRS can face fines and penalties. In addition, failure to register the trust can result in delays and difficulties in transferring or selling the property.
However, the exemption does not cover trusts that hold interests in land or property. If you have a bare trust that holds interests in land or property, you will need to register the trust with the TRS if it meets certain criteria. The registration requirements apply if the trust has a UK tax liability, such as income tax, capital gains tax, or inheritance tax.
How do you register a bare trust?
The registration process involves providing detailed information about the trust, including the names and addresses of the settlor, trustee, and beneficiary, as well as information about the trust’s assets, income, and tax liabilities. The trustees must also keep accurate records of the trust’s transactions and be able to provide them to HM Revenue & Customs (HMRC) if requested.
What are consequences on non-registration?
Penalties for non-compliance with the registration requirements can be significant. Trustees who fail to register a registrable trust within the required timeframe can be subject to penalties of up to £5,000, as well as daily penalties of up to £10 per day for each day that the registration is overdue. In addition, failure to register a trust can result in criminal sanctions, including fines and imprisonment.
If you have a bare trust that holds interests in land or property, you will need to register the trust with the TRS if it meets certain criteria.
Another potential consequence of failing to register a bare trust in land or property is the possibility of a tax investigation by HM Revenue & Customs (HMRC). If the trust generates income or has assets that are subject to income tax, capital gains tax, or inheritance tax, the trustees may be liable for tax penalties and fines if they fail to comply with the tax requirements.
What are the tax implications?
In addition to the registration requirements, bare trusts that hold interests in land or property may be subject to additional taxes, such as stamp duty land tax (SDLT) and capital gains tax (CGT). The tax liabilities associated with bare trusts in land or property can be complex, and it is important to seek professional advice to ensure that the trust is set up and administered in a tax-efficient manner.
One potential advantage of using a bare trust for holding interests in land and property is that it can provide greater privacy and confidentiality than other types of trusts. However, it is important to note that the registration requirements and tax implications associated with bare trusts in land and property can be significant. Failure to comply with the registration requirements or pay the appropriate tax can result in penalties and fines.
In conclusion, failing to register a bare trust in land or property with the government’s Trust Registration Service can have serious consequences, including fines, penalties, and delays in transferring or selling the property. You may need to register the trust and comply with complex tax requirements. It is important to seek professional advice to ensure that the trust is set up and administered in a tax-efficient manner, and to avoid penalties and fines.
If you are affected by any of the issues above and would like more information, please call 0114 272 4984 or email info@shipleystax.com.
Please note that Shipleys Tax do not give free advice by email or telephone.
Testimonials
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