The 2016 budget announcement means a few changes that could affect sessional GPs.
The headline change announced in the Budget that might affect GPs is the change to the so-called IR35 legislation. This is going to be with effect from April 2017, and is designed to counter the tax advantage gained where someone who would otherwise have been an employee then trades through a company to obtain the tax/NIC advantages of ‘low salary/high dividends’ – rather than normal PAYE.
No details of how the new rules might work have been published at the time of writing, but the broad intention is that:
- If the ultimate ‘employer’ is a public service entity –(so the NHS) which will probably include GP practices as well as hospitals and
- The engagement would have been an employment were it not for the intermediary company
- Then the public service entity – or the agency supplying the individual – will be responsible for deciding whether IR35 will apply, not the intermediary company itself.