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…
Autumn Budget Statement 2023
IN A LARGELY uninspiring speech and, amidst declining inflation rates, the Chancellor’s Autumn Statement delivered some fairly unspectacular tax cuts.
In today’s Shipleys Tax note we give you a snapshot of what you need to know as an employer, self-employed or business.
National Insurance Takes Centre Stage
Following much vaunted speculation post-October’s inflation report, expectations were high for potential reductions in corporation tax, inheritance tax, and National Insurance (NI). The final decision primarily impacted NI, affecting both employees and self-employed individuals. However, the effective dates for these changes vary.
Employee NI Rate Cut from January 2024
Effective from 6 January 2024, the Primary Class 1 main NI rate will decrease from 12% to 10%. This alteration, reminiscent of the mid-year modifications in 2022/23, necessitates payroll software updates. It’s crucial for businesses to ensure these updates are implemented before processing January’s payroll. Note: The rate for earnings above the Upper Threshold remains at 2%.
Significant Changes for Self-Employed NI Contributions from April 2024
Starting 6 April 2024, Class 2 NI contributions, mandatory for the self-employed, will be abolished. Self-employed individuals with profits between £6,725 and £12,570 will maintain access to contributory benefits like the state pension through NI credits without paying contributions. Voluntary Class 2 payments remain an option.
Additionally, the main Class 4 NI rate will be reduced from 9% to 8%.
Extended NI Incentive for Hiring Veterans
The beneficial NI incentive for recruiting veterans is now extended until 2025.
Expansion of Cash Basis Accounting for Self-Employed Businesses
The Autumn Statement also brought some good news for self-employed businesses using cash basis accounting. The turnover limit for this accounting method has been removed. Previously, businesses had to switch to the accruals basis after exceeding £300,000 turnover
Business tax
- Capital allowances – permanent full expensing – Full expensing is now a permanent tax break for companies. The Spring Budget 2023 introduced two new temporary first-year allowances. For expenditure on plant or machinery incurred on or after 1 April 2023 but before 1 April 2026, companies can claim a 100% first-year allowance for main rate expenditure – known as “full expensing” – and a 50% first-year allowance for special rate expenditure. Today’s announcement makes full expensing and the 50% first-year allowance permanent by removing the expiry date of March 2026.
- The two R&D reliefs (RDEC and the SME scheme) to merge from 1 April 2024 – A range of measures on tax reliefs have been announced including enhanced support for Research and Development (R&D) intensive small and medium-sized enterprises, an extension to the ‘sunset date’ for freeport tax reliefs and administrative changes to the creative industry tax reliefs.
- The EIS and VCT schemes are extended for another decade.
- The tax reliefs for Investment Zones and Freeports are extended to ten years.
More to follow.
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When are Directors liable for unpaid company taxes?
IN THE UK’s corporate realm, the concept of limited liability shields directors from personal accountability for company debts, including tax obligations. However, there are specific instances where HMRC can pierce this corporate veil, seeking recompense directly from directors.
In today’s Shipleys Tax note we outline these rare yet significant circumstances and the potential legislative defences that may be available to company directors.
The Principle of Limited Liability Status
Limited liability maintains a distinct legal separation between the company and its directors. Nevertheless, this shield is not impervious. There are certain situations, often involving serious misconduct or negligence, where directors can find themselves personally liable for the company’s unpaid taxes.
Where Might Directors Face Personal Liability?
Director’s Personal Guarantees
When a director provides a personal guarantee for a company’s debt, they pledge their own assets as security for the loan. This guarantee means that if the company cannot repay its debts, the director’s personal assets can be targeted to recover the amount owed. Similarly, if a director has an outstanding balance in their director’s loan account, which is not settled before the company enters insolvency, they may become personally liable to repay this debt.
There are certain conditions, often involving serious misconduct or negligence, where directors can find themselves personally liable for the company’s unpaid taxes.
Wrongful or Fraudulent Trading
Directors must act responsibly with regard to the company’s financial status. Under insolvency rules, if directors continue to trade when they know the company is insolvent, or if they incur debts without a reasonable prospect of the company being able to repay them, they can be held personally liable for wrongful trading.
Fraudulent trading goes a step further, where directors deliberately set out to defraud creditors. In such cases, the courts can hold directors personally responsible for the company’s debts, resulting in serious legal and financial repercussions.
Tax Evasion or Avoidance
Tax legislation gives HMRC additional powers to hold directors accountable for tax evasion or avoidance. If a director is found to have a history of corporate insolvency, particularly if insolvency has been used as a means to evade or avoid tax liabilities, HMRC can pursue them personally. This legislation aims to deter directors from using insolvency as a tax evasion strategy, ensuring that corporate tax liabilities are met.
Personal Liability Notices (PLNs)
HMRC uses Personal Liability Notices to hold directors personally liable for the non-payment of PAYE or National Insurance Contributions (NIC). These notices are issued when HMRC believes that the non-payment was a result of the director’s neglect or fraudulent behaviour. Once a PLN is issued, directors can face significant personal financial liabilities, which HMRC will actively seek to recover.
…where directors deliberately set out to defraud creditors… the courts can hold directors personally responsible for the company’s debts, resulting in serious legal and financial repercussions.
Possible Mitigating Factors
When facing action from HMRC for liabilities such as PAYE, NIC, VAT, or Corporation Tax (CT), directors can employ several defences to potentially mitigate or challenge personal liability:
- Lack of Intent: Demonstrating that there was no intention to evade tax payments, that any underpayment was a result of genuine error or misinterpretation of complex tax laws, can be a defence. Evidence seeking clarification or rectifying mistakes as soon as they were discovered needs to be maintained.
- Reliance on Professional Advice: reliance on the advice of competent tax advisors or accountants might provide a shield against liability. However, reliance on professional advice is not absolute and usually requires proof that the advice was professional, based on correct accurate information, and reasonable.
- No Direct Involvement: A director may argue they were not involved in the day-to-day management of the company or in the financial decisions that led to the unpaid taxes. This could apply in situations where there is a clear division of responsibilities among multiple directors.
- Procedural Errors by HMRC: If HMRC fail to follow proper procedures or meet certain legal requirements when issuing a Personal Liability Notice (PLN) or taking other actions, this may invalidate their claim.
- Unforeseeable Circumstances: Events beyond the director’s control, such as sudden market changes, natural disasters, or other external shocks that impact the company’s ability to pay, might be used as a defence, especially if these events can be clearly shown to correlate with the period of non-payment.
- Active Engagement with HMRC: Demonstrating that there was active engagement with HMRC regarding any payment issues, attempts to negotiate payment plans, or voluntary disclosures of potential underpayments can act in the director’s favour.
- Economic Reality: In some cases, directors can argue that, despite their best efforts, the company was unable to meet its tax obligations due to economic conditions affecting the company’s liquidity.
It is crucial for directors to maintain accurate records and documentation to support these defences. They should engage with legal and tax professionals as soon as they are aware of potential tax liabilities or HMRC actions, to ensure their case is as strong as possible.
In conclusion, while the UK legislation primarily places the burden of unpaid taxes on the company, directors can be made personally liable in certain circumstances. If a director finds themselves facing a PLN or potential liabilities for unpaid taxes, it’s essential to seek advice from an tax expert or professional adviser.
For further assistance or queries, please call 0114 272 4984 or email info@shipleystax.com.
Please note that Shipleys Tax do not give free advice by email or telephone. The content of this article is for general guidance only and should not be considered as tax or professional advice. For advice on tax matters, always consult with a qualified professional.
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TAXING BEAUTY – HMRC’s new approach to VAT for cosmetic procedures
DUE TO THE rapid growth of the private cosmetic medical sector in the UK, some noticeable shifts have begun to appear in HMRC’s approach to VAT in the cosmetic medical sector. HMRC have reportedly now established a dedicated team to examine the VAT implications of treatments such as Botox, skin fillers and facial peels.
In today’s Shipleys Tax brief, we consider whether HMRC’s position is now seemingly leaning towards categorizing certain treatments as standard-rated for VAT rather than exempt.
Historical Stance vs. Current Direction
While traditionally, treatments aimed at medical purposes have often been exempt from VAT, those perceived as purely cosmetic have leaned towards being standard rated (20%). This distinct separation is becoming more blurred. Procedures that serve dual purposes, such as Botox, now find themselves in a VAT grey area. There’s a growing inclination from HMRC to classify certain ambiguous cosmetic treatments as standard-rated unless they solidly fit within the medical exemption.
There’s a growing inclination from HMRC to classify certain ambiguous cosmetic treatments as standard-rated unless they solidly fit within the medical exemption.
Recent court case
In one recent tribunal case involving a prominent skin clinic, these VAT issues were brought to the forefront. The clinic had applied for a VAT credit for a specific timeframe, a claim which HMRC challenged asserting that the services during that period were not exempt from VAT.
During the tribunal, a wealth of evidence was presented, including testimonies from the clinic’s lead practitioner, a highly qualified registered medical professional who had pivoted to ‘aesthetic medicine’ and operated the clinic, offering an array of cosmetic treatments.
While the tribunal acknowledged the lead practitioner’s expertise and dedication to professional ethics, it ruled that that cosmetic treatments provided by the clinic did not qualify for VAT medical exemption. It found that the treatments were for “aesthetic reasons” and not for clinical reasons.
The Impact
This evolving stance means that businesses offering cosmetic treatments need to be extra vigilant. The ruling underscores the importance of the nature and intent behind services in determining VAT status, emphasizing the need for meticulous record-keeping and understanding of HMRC’s evolving views on VAT exemptions in the cosmetic medical sector.
…cosmetic treatments provided by the clinic did not qualify for VAT medical exemption. It found that the treatments were for “aesthetic reasons” and not for clinical reasons.
How Shipleys Tax can help
With the landscape shifting, our Shipleys VAT team can help ensure that your practice remains compliant, anticipating and adapting to any changes in HMRC’s perspective on VAT within the sector.
Adapting to change is vital in today’s dynamic environment and ensuring your practice stays ahead and compliant is crucial to avoid falling foul of the legislation.
If you would like assistance, or 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.
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Testimonials
“We value the close working relationship we have with Shabeer and the specialist teams at Shipleys Tax...(read more)
Dr K, GP Surgery – Yorkshire
“One of the most frequent issues we had with our previous accountants was not being made aware, in advance... (read more)
FM Medical Practice – Manchester
“Accountants seem to promise the earth but don’t deliver do they? Well we found the opposite. Abdul made himself... (read more)
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