AISMA responds to 2020 Budget announcement
March 11, 2020
Responding to the 2020 Budget presented by the Chancellor of the Exchequer today, Andrew Pow, executive board member of the Association of Independent Specialist Medical Accountants (AISMA) and partner, Mazars UK, said: “We welcome the news that the annual allowance threshold for the NHS Pension Scheme will be increased by £90,000 for the 2020/21 tax year. This means that any doctors earning up to £200,000 will now get the full annual allowance of £40,000.
“While this will not remove higher earners with growth above £40,000 from having a tax charge, it will mean most doctors will not have their annual allowance tapered down. It will be important that NHS pension records are kept up to date so that higher earning doctors can assess their tax position.
“The Chancellor also announced that entrepreneurs’ relief on business capital gains will be reduced to £1 million from £10 million. This keeps the allowance in place for most GPs selling shares in their premises.
“The earlier announcement today of a reduction in interest rates by 0.5% will benefit doctors who have variable rate loans on their surgery borrowing.”
Updated GP contract – AISMA verdict: PCNs win but core contract loses out
February 7, 2020
Response to update to the GP contract agreement 2020/21 – 2023/24
Published by the BMA on 6 February 2020
Speaking on behalf of the Association of Independent Specialist Medical Accountants, Andrew Pow, partner at Mazars UK, said: “It is positive that NHS England has responded to the concerns raised around PCNs, particularly the removal of the requirement for practices to fund 30% of the cost of new roles and the assurances given around the risk of future employment liability. It is encouraging that PCNs can now actively chose to engage with community partners to employ staff on their behalf.
“There is now a clear active agenda to encourage resources to flow into primary care, although concerns remain around the availability of staff to take up new roles, particularly in areas that have struggled to recruit.”
Mr Pow continued: “It is encouraging to see financial support for new doctors taking up partnerships, although the new contract does not address the current retention issue. From April 2020 seniority income will cease and it is disappointing that there is no replacement of incentives for partners to remain as partners. Many partners will question the Locum Support Scheme as they already feel the balance in favour of being a locum over a partner is too strong.”
According to Mr Pow, the digital-first service initiative is positive, with many areas now adopting these services to improve patient access. “It is not entirely clear what funding will attach to this, but if it is funded in a similar way to PCN staff then it should be helpful”, he said.
While there is good news around premises investment, Mr Pow said issues remain about premises costs in leased premises which remain unresolved.
Mr Pow warned that, against a backdrop of constructive initiatives and support, there is very little additional funding going into the core GMS/PMS contracts, which will be expected to pick up the costs involved with improved employment provisions for staff. “Many practices are now beginning to feel the impact of the increases in the minimum wage flowing through all staff levels”, he said. “A rise in the global sum to £93.46 – an increase of £3.58 on the face of it – looks positive. However, practices will have lost all MPIG and seniority funding from April 2020 and have staff pay increases and new employment conditions to absorb. In many cases this may deliver a profit reduction year-on-year.”
AISMA responds to draft network specifications
January 15, 2020
The Association of Independent Specialist Medical Accountants (AISMA) has published its response to the draft service specifications for primary care networks (PCNs).
The response focuses on the financial implications of the specifications, which relate largely to service delivery.
Specific points raised by AISMA include how and when money from the Investment and Impact Fund will be made available and how practices will agree to split the ongoing employment costs for additional roles to be recruited. Only 70% of these costs will be reimbursed. Other questions include how the significant project management time involved in the ongoing development of service delivery will be funded.
Other points in the AISMA response consider VAT on supply of staff working across the networks; employment contracts and how they relate to NHS Pension scheme membership; sub-contracting and the off payroll IR35 regulations; and existing work commissioned by local CCGs.
Click here to download the response
Response from NHS England received 20 January:
Many thanks for your considered response to our engagement on the draft Network DES service specifications. Please take this email as acknowledgement of receipt of your comments.
We would like to thank the large numbers of GPs, local medical committees (LMCs) and others who took the time to read and respond to the drafts. This is particularly true as the engagement period was necessarily shorter than planned, driven on one side by the timing of the general election and on the other by the need to give GPs good notice of their new contracts for April 2020.
This is the first time that we have shared draft GP contract materials for open engagement. Whatever the views of respondents about the specifications, we view such widespread engagement in a debate about how primary care networks (PCNs) develop as a positive change and a learning opportunity.
Having invited your feedback, we want to be absolutely clear that we have heard the views expressed. We will now carefully consider how to respond adequately, balancing the ambition to improve services for patients across England and the need to stabilise general practice, with what can realistically be delivered by PCNs in 2020/21.
A final version of the GP contract for 2020/21, informed by this engagement, will now be agreed as soon as possible through negotiations with the BMA GPC.
Primary Care Strategy and NHS Contracts Group
NHS England and NHS Improvement
Action on 2019/20 pension tax impacts
November 22, 2019
NHS England has announced the action to be taken on 2019/20 pension tax impacts:
Responding to the announcement, Andrew Pow, executive board member of the Association of Independent Specialist Medical Accountants (AISMA), said:
“This announcement may go some way to persuading NHS doctors to work the shifts needed to meet demand over the winter. However, it is important that doctors understand that the proposals relate only to their 2019/20 tax payments. Those with large annual allowance tax charges for 2018/19 will still need to pay these in January 2020.
“It is uncertain if the payment of the 2019/20 tax on retirement may lead to a benefit in kind income tax charge. While positive news at first glance, the announcement contains significant uncertainties, including the potential for some form of down the line tax charge, which may not lead to the change in behaviour that is intended.
“Doctors who have already opted out of the NHS Pension Scheme to avoid the annual allowance tax charges should talk to a specialist financial adviser as soon as possible to consider the pros and cons of re-joining the scheme.”
Read how GPonline.com reported the announcement:
BMA demands legal guarantee over pension tax offer as accountants flag ‘uncertainties’
Years of service charge disputes ‘have undermined GP funding and recruitment’
November 21, 2019
AISMA accountant Andrew Pow tells GPonline.com that long-running disputes over service charges have cost GP practices in NHS-owned premises ‘huge amounts’ of time and money and left them unable to recruit or plan ahead. Read the full article.
Pension flexibility proposals unworkable and discriminatory
October 31, 2019
Proposed flexibilities to the NHS Pension Scheme are unworkable and discriminatory, says the Association of Independent Specialist Medical Accountants (AISMA).
Responding to the government’s consultation on pension flexibilities, the association, which includes some of the UK’s foremost authorities on the NHS Pension Scheme, says that the proposals represent uninformed tinkering with the NHS Pension regulations and that a complete re-think is required that must involve changes to pensions tax legislation.
AISMA also warns that the proposals, which only apply to senior clinicians, discriminate against other groups of employees, including highly paid NHS administrators and managers who may also be affected by the annual allowance tax rules.
Deborah Wood, AISMA vice-chairman and healthcare services partner at accountancy firm MHA Moore and Smalley, said: “These proposals do not make it any easier for doctors to understand their pension position. Deciding on a reasonable percentage of pay to pension to avoid a tax charge represents a game of chance for all doctors and for GPs this is compounded by out of date records due to the underperformance of Primary Care Support England (PCSE).”
Ms Wood says that most NHS Pension Scheme members have insufficient understanding of their own pension arrangements. While the consultation suggests that a modeller will be provided to assist with planning, she says this will only be as good as the person feeding information into it.
“Doctors would welcome a simplified system that was fairer and allowed a reduction in the fees for professional accountancy, tax and pensions advice. This could be achieved if the government decides to act on the recommendation of its independent tax adviser, The Office of Tax Simplification, which is to scrap the annual allowance cap on pensions.”
Notes to editors
Click here to read AISMA response in full
Read the DHSC’s consultation here.
For further information please contact Rosalind Dewar on 01580 764713 / 07785 182732 or email email@example.com
GPonline.com: annual allowance cap on pensions should go
October 11, 2019
The Office of Tax Simplification has suggested the annual allowance cap should be removed from defined benefit pension schemes, including the NHS Pension Scheme. Click here to read a full report, including a comment from AISMA executive board member Andrew Pow, on the GPonline.com website.
Practice Index – Is your practice being paid for the work it does?
September 17, 2019
Deborah Wood, AISMA Vice-Chairman, offers this beginner’s guide to claiming for the work the practice carries out. Not always a straightforward task, these helpful tips, published on the Practice Index blog, will help practice managers keep on track. Click here to read the full article.
Pulse: What do the pension proposals mean for GPs?
September 12, 2019
GPonline.com: Government pension consultation
September 11, 2019
The government has announced a new pension consultation to create more flexibility for doctors in the NHS Pension Scheme. Speaking to GPonline.com, AISMA board member Andrew Pow said that for many GPs it remained ‘very difficult to predict growth’ in pensions – and that tailoring contributions to avoid tax penalties would not be straightforward. To read the full article visit the GPonline.com website.