Employment Allowance

Employment Allowance

Didn't find your answer?

My Client a Dentist, in practice, has two employees one assisting the practice as a dental nurse the other reception and admin. The

practice is 10% private patients and 90% NHS patients, does he qualify for Employment Allowance of £2,000 for Class 1 employer contribution ?

Have asked HMRC SME team but they only refer back to the guidance notes (not explicit enough). Any answers ?

Replies (7)

Please login or register to join the discussion.

By mrme89
09th Jul 2014 16:25

I would say the guidance is pretty clear...

 

You cannot claim the Employment Allowance, for example if you:

employ someone for personal, household or domestic work, such as a nanny, au pair, chauffeur, gardener, care support workeralready claim the allowance through a connected company or charityare a public authority, this includes; local, district, town and parish councils

carry out functions either wholly or mainly of a public nature (unless you have charitable status), for example:

NHS servicesGeneral Practitioner servicesthe managing of housing stock owned by or for a local councilproviding a meals on wheels service for a local councilrefuse collection for a local councilprison servicescollecting debt for a government department

Thanks (0)
Logo
By ArsalanShah
09th Jul 2014 16:38

Probably Not

One of the key exclusions for a dental practice according to the guidance is if work is wholly or mainly of a public nature, which suggests (unless someone could prove other way) that if more than 50% of your work is for the NHS you are not eligible.

Hope this helps.

Thanks (1)
avatar
By kpdahals
30th Jul 2014 07:59

Income of Dentist ?

Is Remission form part of income of the dentist? Is this extra income in addition to fixed contract value?

Or Dentist fixed contract value is maximum amount they earn? Remission automatically set off against fixed contract value?

Thanks (0)
Euan's picture
By Euan MacLennan
30th Jul 2014 10:13

The law

... is set out in ss.1 & 2 NICA 2014.  For once, the HMRC guidance is an accurate reflection of the law.

I agree - a dentist earning more than 50% of his income from the NHS cannot qualify for the Employment Allowance.

Thanks (0)
avatar
By User deleted
30th Jul 2014 10:49

The question then ...

... is whether it is cost effective to split the business and have a separate company that just has private clients, or are there rules against that?

Or could you have two PAYE schemes and run two departments?

Thanks (0)
By mrme89
31st Jul 2014 08:18

You can still claim the allowance if operating two PAYE schemes. But considering only 10% of the above business would be eligible, I don't see any benefit of doing it.

Thanks (0)
By Steve Kesby
31st Jul 2014 09:37

Of course...

... what you could do is have the dentist practice in an LLP and then employ all the staff through a service company, which then makes a recharge to the LLP.

The employer wouldn't then be providing services of a public nature.

And because LLPs are opaque for VAT purposes, forming a VAT group would get around the VAT issue that it creates for a business that makes predominantly exempt supplies.

Thanks (0)