Incomplete service record puts big dent in doctor’s pension

A single six month rotation as a house officer in hospital can typically represent £1,000 a year and a tax free lump sum of £3,000 to a GP’s pension. However, the doctor will only receive this if the period of service is noted on his or her service record. Consequently, incomplete service records can significantly reduce the amount the doctor receives in retirement.

Take the case of a new partner at a practice represented by AISMA accountants Moore and Smalley LLP for several years. When the GP arrived at the practice Moore and Smalley asked for a full NHS career history, including, where possible, dates of joining and leaving. At the same time, the firm requested an estimate of the GP’s pension from the NHS Pensions Agency, including a full breakdown of the doctor’s service record.

David Walker, Healthcare Services Senior Tax Manager at Moore and Smalley, says: “Once we received the estimate from NHS Pensions we compared the service record with the details provided by the GP. It’s surprising how often the two do not match and this case was no different.”

Moore and Smalley discovered that NHS Pensions had over two years of service missing from their records. David Walker explains: “This GP had 20 years to go before his standard retirement age, but even at today’s rates this would have caused him to receive a pension of £4,300 a year less than it should have been and a reduction of £12,900 in the tax free lump sum.”

The case highlights how important it is for doctors to have an accountant who knows what to look out for and who understands the impact that missing service can have. “We were able to get the missing service added to the doctor’s records held by the NHS Pensions Agency, ensuring that he will receive his full pension entitlement when the time comes,” says David Walker. “It is unlikely that GPs on their own, or non-specialist accountants, would even notice that anything was amiss.”

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