For GP practices and medical consultants, it is very important to know what your tax liability is. Establishing what the correct amount of tax to pay is for your company could make the difference between a practice with successful cash flow and one that fails. By working with a firm like Adcock Accounting, you can help maximise your allowance and claims and therefore reduce your tax liability.
One of the most important tips we have for GPs and consultants is to keep an accurate record of their expenses. This includes a mileage log, broadband and mobile telephone claims, and any professional subscriptions you might have such as GMC, MPS and MDU. These are all allowable expenses against taxable income during the year for your profession.
It is also important to check that you haven’t overpaid national insurance. This is applicable to GPs who are employed as well as self-employed and therefore paying both class 1 and class 4 national insurance contributions and earning over £43, 000 per annum. There is a provision in legislation allowing for Class 4 NI to be backdated indefinitely, meaning that you could be owed substantial refunds. To check if you are due a refund you must meet these criteria:
- Employed and self-employed during a tax year.
- Under state pension age and pay NI
- Total earning exceeds £42,385
Contact us for more information and advice if you think you might qualify for a refund.
As a GP/consultant you must check your pension position, as new changes have been put into place from 6th April 2016. The maximum amount an individual can contribute to a pension scheme in tax year has changed dramatically. For high earning GPs there could be significant tax liabilities. Individuals with total income exceeding £100,000 will have their annual allowance reduced by £1 for every £2 of income above £100,000. However, this will only occur where individuals are caught by The Threshold Income test and The Adjusted Income test.
If you are a GP or consultant and think you could benefit from learning more about your tax liability or need any help, please don’t hesitate to contact us by calling 01623 490 120 or email