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December 2017 – January 2018 Issue 97 £12.50
INDEPENDENT PRACTITIONER TODAY
The business journal for doctors in private practice
In this issue
Relieve stress: live with it Tips for managing stress on the job – without trying to eradicate it P20
The diary of a clinic build
Developing your own premises requires putting on a hard hat P34
Don’t think you can skimp on cover
A legal look at what you need to know about medical indemnity and insurance P40
Tax drive to hit doctors By Robin Stride
Moves to improve tax compliance could backfire and lead to some doctors cutting their commitment to the private sector, specialist medical accountants warn. HM Revenue and Customs (HMRC) has announced: ➲ A tightening up of compliance issues for ‘wealthy individuals’. Accountants say most consultants would be regarded as wealthy in the taxman’s eyes; ➲ The introduction of new tech nology to tackle the ‘hidden econ omy’ – such as a few consultants who accept cash; ➲ An increasing attack on tax avoidance schemes. HMRC believes doctors and dentists are serial users of these; ➲ New measures from April 2019 to quickly recover tax through PAYE. ‘Hidden print’ in last Autumn’s Budget suggests further trouble for private consultants and GPs who have been less than meticulous with their tax affairs. But Ray Stanbridge, of Stan bridge Accountants, said: ‘The measures increasingly reflect HMRC’s views that the medical sector is a ripe apple to be squeezed harder and harder. Obviously, in some cases, the proposals are fully justified. ‘However, the vast majority of consultants are honest with In association with
respect to their tax affairs. If such honest consultants are squeezed too hard and unfairly, they respond by withdrawing their labour and increasing their leisure time. The natural result is that there is less tax take – the com plete opposite of what was intended.’ He said HMRC’s plan next year to be able to recover tax through PAYE might mean consultants would not be able to plan their monthly net pay if they owed tax. ‘At the very least, this could lead to some individual discom fort.’ The Government is investing a further £155m in additional resources and new technology for HMRC. The tax authority said this was forecast to help bring in £2.3bn of additional tax revenues by allow ing it to: Transform its approach to tack ling the hidden economy through new technology; Further tackle those who are engaging in marketed tax avoid ance schemes; Enhance efforts to tackle the enablers of tax fraud and hold intermediaries accountable for the services it provides using the Corporate Criminal Offence; Increase its ability to tackle non-compliance among mid-size businesses and wealthy individu als;
Recover greater amounts of tax debt including through a new taskforce to specifically tackle tax debts more than nine months old. David Redfern, of DSR Tax Claims, said: ‘Although it is important that HMRC is able to collect the tax revenue that they are owed, these new powers have the capacity to throw the finances of hard-working taxpayers into chaos.’ HMRC must currently wait until the end of a tax year to recoup any shortfall in tax reve nue from any individual taxpayer and is also required to write to inform the taxpayer that their tax code will change due to this underpayment.
He said if new powers gave it the right to deduct extra tax immedi ately from taxpayers’ salaries if it believed there was an underpay ment of tax, then this could lead to taxpayers not knowing how much to expect in their salary each month. Added Mr Redferm: ‘These new powers will cause major problems for taxpayers, who won’t be able to plan and budget ahead because they will be at the mercy of HMRC. He doubted tax overpayments would be refunded as efficiently and hoped ‘good sense will prevail at HMRC’ and that the move will be delayed until its full conse quences to the taxpayer had been assessed.
ONE OF A KIND: The first private hospital of its type in the UK has opened for business. Read the full story on page 8