The NHS Pension Scheme was created in 1948 and is the largest centrally administered public sector pension scheme in Europe and currently has 1.4 million actively contributing members, and pays pension benefits to over 750,000 pensioners every month.
When the NASGP was founded in 2007, GP locums were not entitled to contribute to the NHS superannuation scheme. So we made it our first priority to lobby the BMA to ensure we could, and 3 years later we succeeded.
The issue of pensions is complex, and the NHS pension scheme is widely regarded as an excellent scheme, and as with anything so crucial as your pension, we also advise you to seek expert advice from an independent financial advisor.
In a nutshell
- You can only contribute 90% of your NHS locum income (not from a limited company) into the NHS pension scheme.
- In England & Wales, the employing practice must pay you the 14.3% employer contribution.
- You need to get a Locum FormA signed once a month for each practice you worked in that month.
- At the end of the month, as soon as you can, use Locum FormB to amalgamate all your income, and use it to calculate what you need to pay.
Locum pension forms
Can I pension my work if I'm a limited company?
You can not pay any contributions in to the NHS superannuation scheme that were paid to a limited company - so that means that if you're employed by a company (such as a locum agency or your own private company), you'll have to use an alternative pension scheme. Locum GPs who are members of a chambers are usually able to contribute to the NHS pension scheme since they remain self-employed.
Employer’s contribution for a private pension?
If you are a locum GP in the NHS scheme the practice must pay a 14.3% contribution to the locum, and you then pay that to NHS pensions along with your personal contribution. If you are not in the NHS scheme, you can still negotiate an employer's contribution with the practice if that is your wish, although there is nothing contractual in place for non-NHS schemes.
Do I have to pension all my NHS locum earnings?
Exclusive clarification from the Technical Consultancy Team, NHS Business Services Authority (NHS Pensions)
The regulations state that “a Locum practitioner may apply to join this Section of the scheme by sending an application (Locum forms) to the Employing Authority.”
Members have 10 weeks to pension this work. If they do not submit the forms in time then this work cannot be pensioned. So in effect they do have a choice, if they choose not to pension the work they do at Practice A then they just have to let the practice manager know that they are not going to pension it so that the 14.3% is not included in the cash envelope.
If you're a GP locum employed by a company, such as a locum agency or your own limited company, your are not eligible to contribute money earned in this way into the NHS superannuation scheme since you are the employee of a private company.
Do I pay tax on the employer’s contributions?
No. Either way, if you're asking this question, you should be using an accountant!
What should I do with the employer's contribution if my pension payment was rejected?
You've got 10 weeks from the last date in that month to get your NHS pension payment to your local Area Team. Go beyond that, and they can reject your payment.
But strictly speaking you're not free to spend all that un-cashed money; the 14.3% employers contribution has to be returned to the practice. That said, if you're using NASGP's T&Cs, there is a clause that allows you to reserve the right to charge an extra 20% to compensate you - so, quids in! Regardless, you can of course keep your personal contribution, and you'll be wise to invest it in a private pension pot - but it'll be unlikely to accrue the same benefits as it would have inside your NHS pension.
Use NASGP's locum Terms & Conditions which includes a clause to receive compensation if their delay causes payment rejection.
Who should pay for the employer’s contribution?
The statutory NHS Pension Scheme Regulations and section 49 of the Pensions Act 1995 states that the employer has to pay the contribution if you're contributing to the NHS superannuation scheme.
Failure to remit contributions to the Scheme, complete relevant paperwork, update member pension records, or deny employees access to the Scheme constitutes a breach of the statutory NHS Pension Scheme Regulations and section 49 of the Pensions Act 1995. Section 48 of the Pensions Act 1995 and section 70 of the Pensions Act 2004 states that NHS Pensions has a legal duty to report any ‘breaches of law’ to the Pensions Regulator. If an individual is found guilty of a ‘breach of law’ they may be subject to a heavy fine, imprisonment, or both.
And also, according to the BMA, if that practice is a GMS practice it is also acting in breach of the statutory GMS SFE (Statement of Financial Entitlement. The SFE has penalty clauses including giving the PCO powers to withhold monies it pays to the practice if any part of the SFE has not been complied with.
So from April 2013, in England and Wales, since funding is provided for all superannuation contributions, including those of GP locums, it is now the responsibility of practices in England and Wales to pay the employer’s contribution for locums.
If a practice therefore refuses to pay, the NHS Pensions Division, the Pensions Division can withhold monies from a GP Provider’s pension benefits if they decide they have been acting illegally.
Section 48 of the 1995 Pensions Act and section 70 of the 2004 Pensions Act states that the NHS Pensions Division has a legal duty to report any 'breaches of pensions law’ to the Pensions Regulator. If an individual is found guilty of a breach they may be subject to a heavy fine of up to £50,000.00 per offence.
The NHS Pensions Division also have a duty to inform the Business Services Authority, at NHS Counter Fraud Services, if they believe that fraud may have taken place in the NHS. NHS Counter Fraud has already investigated several Practices who are allegedly breaking the law.
Has a practice refused to pay you your employer's contribution?
Forward the url of this page to that practice to inform them - they probably weren't aware. Or copy/paste it into your next invoice.
Exclusive advice from NHSPA
If you are an employed sessional GP (an assistant, retainer, or salaried) working for an organisation that qualifies as a NHS Pension Scheme Employing Authority (GP Practice, CCG, LHB, etc) your employer must, in law, ensure your employment is pensionable. If you are a self-employed freelance GP locum working in the NHS you have been entitled to ‘pension’ your income since April 1st 2001. Your scheme membership is ‘triggered’ by completing (and submitting) forms A and B.
If you are a freelance GP Locum working for an agency (or a commercial deputising agency) or have set yourself up as a limited company you fall outside of the NHS Pension Scheme and cannot ‘pension’ your NHS income; you should therefore consider alternative pension arrangements.
Once you’re paying regular Scheme contributions into the Scheme, keep an eye out in your bank statements to ensure your cheques have been cashed as not all authorities send monthly statements.
Meanwhile, for locum GPs, practices are responsible for paying the 14.3% employer’s contribution (which is actually 12.6% of the bill, allowing for 10% of the locum income being classed as “professional expenses” and not being pensionable – as is the case at the moment).
Type 2 Medical Practitioners – Self Assessment
A Type 2 medical practitioner is a:
- salaried GP formally employed by a GP surgery, APMS Contractor, or a LHB (Wales).
- long-term ffee-basedGP who worked for a GP surgery, APMS Contractor, or a LHB.
- GP who solely performs OOHs either on an employed or self-employed basis.
- GP ‘with special interests’ (GPwSI) employed or engaged by NHS England or a LHB.
Every Type 2 medical Practitioner in England and Wales is required by law to complete an annual self-assessment form and arrange for any arrears of employee contributions to be sent to the relevant NHS Pension Scheme ‘employer’. If contributions have been overpaid the Type 2 GP must also be pro-active in recovering these.
The form must be sent to the relevant local area team in England or LHB in Wales by no later than the last day of February each year.
If a Type 2 medical Practitioner fails to complete the form and subsequently pays employee contributions at the wrong rate, they are acting in breach of statutory pensions legislation; this may affect their NHS pension benefits at retirement. There is more detailed guidance on the form.
Form SOLO – what’s it for?
Form GP SOLO is used for fee-based ad-hoc work.
- Form GP SOLO (England and Wales) - For use from April 2016
- Form GP SOLO (Scotland) - For use from April 2014
- Form GP SOLO (Northern Ireland) - For use from April 2013
The types of work it covers (this list is for England and Wales, so check for your area of the UK)
- GP locums who've worked regularly at the same practice for more than 6 months.
- Salaried GPs employed by a Practice, PCT, LHB, or Trust who are working on an individual basis (and not on behalf of their employer) under a fee based contract for services arrangement with another NHS Pension Scheme Employing Authority.
- GP Locums who regularly work for an Out of Hours Provider that is an Employing Authority.
- GPs who work solely for an Out of Hours Provider and have no other pensionable posts.
- GP fee-based ad hoc work such as appraisal work.
- The form GP SOLO must be completed by the GP and the ‘fringe’ NHS Employer and sent to the GP’s host PCT/LHB on a monthly basis. However, it is acceptable for only one form GP SOLO to be completed a year (summarising the annual earnings) subject to the contributions still being paid on a monthly basis.
The form GP SOLO must not be used if a GP Provider elects to ‘pension’ their fringe NHS earnings through the Practice account (i.e. pooled income) or if they are employed under a formed contract of employment with a Practice, PCT, LHB, or Trust.
GP Locums Working for an OOHP
- GP Locums working for an OOHP that is a NHSPS Employing Authority 'pension' their OOHs income in the same way as s Salaried GP would; that is by completing form SOLO.
- The OOHP is responsible for the payment of employer contributions at the rate of 14% and for collecting the employee contributions. The earnings must NOT be recorded on forms GP Locum A and B.
- Where a GP Locum is performing pensionable OOHs work the PCT and LHB will set them up as a type 2 medical Practitioner Scheme member. This means that the GP will have two concurrent pensionable posts; Locum Practitioner plus type 2 medical Practitioner. There has to be a distinction under the NHSPS Regulations.
Where a GP Locum (Locum Practitioner) is also a type 2 medical Practitioner it means that they can 'pension' appraisal income on form SOLO. Their income is in effect added to their OOHs income by the PCT/LHB.
Locuming in same practice > 6 months
If you locum at a GP practice for more than 6 months then you can no longer be classed as a locum (for NHS superannuation purposes) in that practice, and would have to become a Type 2 GP.
According to the NHSBA Locum Factsheet (September 2016):
"You can still work under a contract for services arrangement; your surgery is not legally obliged to employ you under a contract of service."
And according to the NHSBA Form GP SOLO (April 2016):
"[Form GP SOLO applies] to NHSPS Employing Authorities including OOH Providers and CCGs who engage the services of GPs on a self-employed/fee-based/contract for services arrangement."
NB as of October 2016, NASGP is aware of email correspondence from the NHSBA that Form GP SOLO is not for the purposes of pensioning locum earnings after six months continuous work at a practice, but the actual formally published documentation from NHSBA alluded to above, we believe, suggests otherwise, so have formally asked the NHSBA to clarify.
NASGP's You will then be able to pension 100% of the fee paid as opposed to 90%.
What’s the definition of a ‘long-term’ locum?
There are three active formal definitions of a locum GP, depending on your aspect. They are not exclusive i.e. being one does not exclude another.
- Employment law
- Tax status with HMRC
- NHS pension scheme
This advice deals exclusively with the NHS pension scheme definition.
From advice direct to NASGP from NHSBA:
Locums cannot be classed as Locums if they work at a practice for more than 6 months, however even if they are at a practice for more than 6 months they can remain as self employed contractors ie they do not have to go on the payroll and the practice do not have to offer them a contract of service. They would still invoice the practice for sessions/shifts done and then the GP SOLO form would be completed and sent instead of the Locum forms.
If a Locum works at a practice for more than 6 months then they should no longer complete locum forms A & B but should then complete SOLO forms for any period beyond the 6 months. They will then be classed as a Type 2 practitioner and this is better for them in pension terms because they will be covered for death in service 24/7 whereas Locums are only covered whilst working.
We've produced a great blog and podcast to complement our updated Model Terms & Conditions which helps explain this in full.
England: Paying your NHS contribution by BACS
This is the latest information we have from the NHSBA as dated August 2016
When submitting your Locum A and B forms, we will require a copy of your BACS submission confirming the date of payment and amount paid. Unfortunately, we cannot update our records until this has been received.
Payment to be made to:
Bank: Nat West
Account name: NHS England
Account Number: 10014896
Sort Code: 60-70-80
- Quote Our Reference as: PCSE-Q47-LOCUM (plus surname)
- Once payment has been made submit Locum A and B forms either by e-mail to firstname.lastname@example.org (forms must be in a single PDF attachment with the Locum B at the front) or by post to the address below. Please mark the envelope (Pensions – LOCUM).
- Submit a copy of the BACS submission with the Locum Forms
- All emails received are acknowledged.
- Forms must be submitted within 10 weeks.
- We will update the GPs record.
If you require any further information please do not hesitate to contact the Pensions Section, Primary Care Support England, Preston Office by e-mail to email@example.com or telephone 01772 221444.
Primary Care Support England
3 Caxton Road
Locum A and B forms in a single downloadable spreadsheet?
We used to provide a very popular (over 1,700 downloads!) comprehensive pre-formatted NHS superannuation spreadsheet, complete with invoicing capabilities and expenses. Trouble is, it needed updating every year, and being a spreadsheet, was clunky to say the least.
We're now rolling out a brand new online version, initially in beta, that can be accessed via the NASGP Dashboard from mid-August 2016.
Pensioning agency work
The NHS superannuation scheme is open to NHS employees and self-employed GP locums employed by NHS practices.
This explains why the LocumA form stipulates that, in relation to the NHS pension scheme:
- Non-NHS (i.e. private) work is not pensionable
- Freelance GP Locums trading as limited companies cannot pension their income
If you're employed by a locum agency, you are working for a private (non-NHS) company, and are therefore unable to pension your work in the NHS pension scheme for the same reason. But you can pension your work into a private scheme.
GP locums working through chambers can generally pension their work using the NHS pension scheme since they remain self-employed (unless they trade as a limited company through the chambers, or for some reason they are employed by the chambers).
Post retirement, are benefits the same for one’s spouse?
If you are in receipt of a pension the rules are the same whether or not you had been a locum GP, salaried GP or partner. There is a 50% spouse's pension, and if you have a dependent child under 23 then they get 25% and if you have a child who has special needs and not capable of independent living then 23 does not apply.
And if you are not married you need to fill in form PN1 to nominate you partner to receive you pension benefits.
Can I pension my CCG work?
As a freelance locum GP, the only way that you can pension CCG work under the NHS superannuation scheme is if you bite the bullet and become a salaried CCG employee. At retirement, you may get a separate Officer pension, or the CCG post may convert to Practitioner under what is known as the 'flexibilities'.
So why can't I pension my CCG work without becoming a CCG employee?
A GP (Dr X) who is solely a freelance GP locum cannot superannuate CCG work on locum forms A and B. This is because a freelance GP locum is defined under the NHSPS regs as follows....
"Locum practitioner" means a registered medical practitioner (other than a specialist trainee in general practice) whose name is included in a medical performers list and who is engaged, otherwise than in pursuance of a commercial arrangement with an agent, under a contract for services by:
- a GMS practice;
- a PMS practice;
- an APMS contractor;
- an OOH provider;
- or Local Health Board,
to deputise or assist temporarily in the provision of essential services, additional services, enhanced services, dispensing services, OOH services, commissioned services, certification services, Board and advisory work, health related functions exercised under section 75 of the 2006 Act, NHS 111 services or collaborative services (or any combination thereof)"
In particular, note that there is no scope for Dr X to superannuate CCG work if working directly for a CCG. Nor can Dr X superannuate their CCG work in any other way; i.e. as a type 2 (assistant) Practitioner.
A type 2 medical Practitioner is defined in the NHSPS regs as follows....
"type 2 medical practitioner" means a GP performer who
- is not a GP provider, and
- is employed (whether under a contract of service or for services) by a GMS practice, a PMS practice, an APMS contractor, an OOH provider, or a Local Health Board, and
- in that employment is engaged wholly or mainly in assisting his employer in the discharge of the employer's duties as a GMS practice, a PMS practice, an APMS contractor, an OOH provider, or a Local Health Board; or
- is participating in a Doctors' Retainer Scheme"
In summary, a type 2 is a salaried GP or long term fee based GP working for a GP Practice, an APMS contractor, an OOH provider, or a Local Health Board. By virtue that there is no reference to a CCG means that Dr X cannot superannuate their CCG income.
If Dr X has been an existing type 1 (GP Partners, single-handed GPs, and GP shareholders in GMS, PMS, sPMS, and APMS are regarded as type 1 medical Practitioners) or 2 (in addition to working as a GP locum) there would be no problem.
Can I pension my work as an appraiser, even though I’m a locum?
Freelance GP locums who are also appraisers will now be able to superannuate their appraisal income.
This means that it will now in effect cost NHS England (or LHBs in Wales) £570.00 per appraisal. The core pensionable fee (excluding employer contributions) will be £500.00 regardless of what type of GP is performing them. GP locum forms A & B will be revamped to provide guidance and of course a freelance GP locum has the flexibility of not ‘pensioning’ their income if they don’t want to.