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I'm more worried about patients. I recently met two medics, a consultant anaesthetist and a specialist intensive care nurse. Both took early retirement for exactly this reason - that if they had continued working they would have been penalised. They were quite categoric about it, it was not in their interest to carry on. They both regretted cutting their careers short (as they saw it) but they had this huge incentive to walk away taking all their experience with them. They are aware that their hospital is losing many of its most experienced people for exactly this reason.
It's not just doctors - the armed forces are also affected, especially when promoted, and they don't have the luxury of refusing shifts or working extra hours to afford the tax charge.
my diamond shoes are too tight etc etc
Perhaps we pay them too much if retiring early on a pension most people couldn't even dream of is their biggest source of anguish!
'Conventional methods of reducing taxable income can be used, such as charitable donations made under gift aid.'
Thanks for the article, but if I could just correct the above statement. It is a common misconception amongst tax advisers and IFAs that Gift Aid can reduce the Threshold Income, but this is not the case.
The legislation for this particular test does not allow a deduction for Gift Aid, but DOES for other charitable gifts, such as gifts of shares and property.
I agree with Harry B, no adjustment is available for gift aid. I act for a lot of GPs and the main problem they have is that they are reliant on NHS Pensions to provide the calculation of growth but due to failings at Capita, who process the GP pension payments, information is often not available on time, is missing or is incorrect. All this uncertainty is unfortunately causing many GPs to leave the pension scheme, retire early or reduce their working hours at a time when the government is trying to recruit more doctors.
I'm glad to have some confirmation that there is a real problem in the NHS which has nothing whatsoever to do with medics being overpaid and is caused entirely by an incompetent government and civil service whose decisions increasingly generate unintended consequences. I am infuriated by snide remarks which suggest we should be jealous of medics receiving good compensation. My concern is that we are providing incentives for experienced people to leave the profession early. If we penalise people for remaining in their role, and give them an incentive to leave, why would we expect the outcome to be any different from the unfolding disaster in the NHS which we are witnessing now? If a medic with 30 years' valuable experience leaves 10 years early how long will it take to replace that level of experience?
Thanks Janejordan. I act for lots of NHS consultants; pensions are an issue! I’m guessing it’s even more complicated for GPs. How do you do the growth calculations without payslips??
You do need the payslips for employment posts, or failing that, you will need to request a pension savings statement from NHS Pensions. These should normally be available within 6 months of the end of the tax year for employed consultants.
Sorry - I wasn't clear with that last comment! Its easier for me with the consultants because they have payslips - I was wondering how you cope with GPs and calculating pension growth without any payslips... do you calculate/project or just wait for AAPSS??
Please be advised that you do not need payslips.
instead, have the clinician call NHS BS on 03003301346 and insist that the pension input values are conveyed over the telephone.
Remember, when determining threshold income, deduct the members gross pension contribution first, then make the same deduction, when adding pension input values, in determining the adjusted income.
The BMA estimates that every consultant in the UK will be impacted by tapering, particularly when most have used up their carry forward allowance.
In my opinion, where possible, every consultant with private practice should be incorporated.
we run carry forward reports and tapering calculations by the dozen and the tax charges are eye-watering!
Please be advised that you do not need payslips.
instead, have the clinician call NHS BS on 03003301346 and insist that the pension input values are conveyed over the telephone.
Remember, when determining threshold income, deduct the members gross pension contribution first, then make the same deduction, when adding pension input values, in determining the adjusted income.
The BMA estimates that every consultant in the UK will be impacted by tapering, particularly when most have used up their carry forward allowance.
In my opinion, where possible, every consultant with private practice should be incorporated.
we run carry forward reports and tapering calculations by the dozen and the tax charges are eye-watering!