The Association of Independent Specialist Medical Accountants is warning some GPs to expect an additional burden of pension administration following proposed changes to pension regulations. Full time GPs aged 50 or over, particularly those paying added year pension contributions, are most likely to be affected by the changes. The new rules state that GPs with an uplift in excess of £50,000 in their annual pension value must receive an NHS Pensions Agency (NHSPA) valuation certificate no later than 6th October after the end of the tax year. This is so that tax adjustments can be made in tax returns due by 31st January and will probably require the GP to submit a certificate of pensionable profits to their PCT by 6th June. The current deadline is 28th February, eight months later and only after practice accounts have been finalised and tax returns submitted.

Deborah Wood, AISMA vice-chairman and head of healthcare services at Moore and Smalley, said: “It is impossible for GPs with practice year ends of 31st March to complete their accounts, tax returns and pension certificates by 6th June. The only solution will be for them to submit an estimated certificate of pensionable profits and this will require a significant amount of work on their behalf by their accountants.”

GPs will be penalised twice as a result of the proposed change in regulations. As well as paying a fee to their accountants for the additional work required in preparing the estimated certificate, they will also need to pay the NHSPA for a corrected valuation once the final certificate of pensionable profits has been submitted. Ms Wood understands that this fee could be hefty. As the tax position may change as a result of the corrected information this may also require amendments to tax returns, possibly incurring penalties and interest charges payable to HMRC. In addition the transitional rules for the 2011/12 tax and pensions year extend the deadline for the NHSPA report to 6th October 2013 which is a considerable time after the 31st January 2013 due date for filing the tax return.

Ms Woods said: “The proposed change in regulations has resulted in a set of pension rules that are not fit for purpose for GPs. Over the coming months AISMA will be in dialogue with the NHSPA and British Medical Association with the aim of establishing a fairer process that puts a stop to GPs having to pay unnecessary fees.” AISMA will also be monitoring PCTs’ performance in processing pension certificates to the required deadlines as they deal with the effects of the Health and Social Care Bill.

AISMA is advising GPs to consult with their accountants to find out if the annual increase in their pension value is likely to exceed £50,000. Doctors wishing to contact their local AISMA member for further advice can find details on the AISMA website.

The BMA has voiced fears that the age of consortia GPs following the Health and Social Care Bill could threaten the confidentiality of patient records.

Ethics department head Dr Vivienne Nathanson claimed the Government was putting its desire for access to information ahead of respect for patient confidentiality.

She warned: ‘The Health Bill proposes that a number of bodies – including the Secretary of State for Health, the newly formed Commissioning Board and the NHS Information Centre – should be given the right to obtain and disclose confidential patient information for any number of unspecified purposes.

‘There is very little reference to rules on patient confidentiality that would ensure patients are asked before their information is shared or guarantee that the patient’s identity will not be revealed. Fears that their data may be shared with others may result in patients withholding important information; this may not only affect their own health but has implications for the wider health service’.

The union’s medical ethics committee chair Dr Tony Calland said it was lobbying for a change in the Bill so that patients had to give explicit consent for any disclosure of information ‘unless the information has been properly anonymised, pseudonymised or there is an overriding public interest’.

The Winter 2010/11 issue of AISMA Doctor Newsline, the publication of the Association of Independent Specialist Medical Accountants, is published today with a line-up of top writers providing some essential financial and management information for general practice. Kathie Applebee, primary care organisation psychologist, kicks off with some timely advice on preparations for GP-led commissioning and compulsory registration with the Care Quality Commission as practices deal with the burdens of increased financial pressures. Solicitor Andrew Lockhart-Mirams has some words of warning for GPs with provider companies on handling conflicts of interest under the new regime of GP-led commissioning

Bob Senior, AISMA Chairman, says: “Our editor Robin Stride has pulled together a cracking issue with plenty of practical advice for doctors and practice managers who are facing massive challenges over the next 12 months. We know that tax and pension issues continue to be a major concern for GPs so the articles by AISMA accountants Tony Brand and Andrew Goddard should be particularly welcomed.”

AISMA Doctor Newsline is available exclusively to clients of AISMA accountants.

Doctors wishing to contact their local AISMA accountant should go to the Find an Accountant page.

A new pension self-assessment form for salaried GPs in England and Wales has been finalised by NHS Pensions working in collaboration with PCTs following advice provided by specialist accountancy firm Moore and Smalley. The purpose of the form, which doctors are obliged to complete and send to their PCT or LHB by 28th February 2011, is to collect all information on NHS pay earned by Type 2 medical practitioners during 2009/10. Type 2 doctors include salaried GPs formally employed by a practice, PCT or LHB, long-term fee based GPs working for a GP practice, salaried GPs working for an APMS contractor and GPs who work solely out-of-hours on either an employed or self-employed basis.

Deborah Wood, healthcare services partner at Moore and Smalley and vice-chairman of the Association of Independent Specialist Medical Accountants (AISMA), says: “The form has been designed to ensure Type 2 GPs are paying the correct rate of tiered contributions on all their GP pensionable pay. The tiered contribution rules are complex and for salaried GPs with more than one post, completing the self-assessment form could prove particularly onerous.” AISMA is advising doctors to seek guidance from a specialist accountant.

The new form and guidance notes can be found at www.nhsbsa.nhs.uk/pensions . Doctors wishing to contact their local AISMA accountant for further advice can find details here.

Members of the Association of Independent Specialist Medical Accountants have reached their £15,000 fundraising target for independent humanitarian medical aid organisation Médecins Sans Frontières. The AISMA Big 15 fundraising challenge, which has been taking place throughout 2010, celebrates the Association’s 15th anniversary and marks 15 years of high quality, specialist accounting services for the medical profession.

AISMA accountants have been organising events throughout the UK, including a gruelling 15km indoor running and rowing challenge undertaken by committee members Luke Bennett and Andrew Johnson at AISMA’s annual conference in May. Other events included sponsored walks and bike rides, together with dress down days, cake sales and quiz nights.

The funds raised by AISMA members will go directly to the Médecins Sans Frontières Amman project in Jordan where surgeons provide complex reconstructive surgery for Iraqi children suffering devastating injuries from the continuing violence across the border.

Head of Fundraising at Médecins Sans Frontières, James Kliffen, says: ‘MSF is a charity close to the hearts of many doctors. We are delighted that AISMA members have reached their £15,000 fundraising target. This is a fantastic achievement.”

Members of the Association of Independent Specialist Medical Accountants (AISMA) have appointed Bob Senior as their new chairman. He takes over from David Clough who stepped down at this month’s AISMA annual conference after leading the Association for eight years. Mr Senior, who is Director, Medical Services at accountants RSM Tenon, is a highly respected practitioner in the field of specialist medical accountancy. AISMA’s new Vice Chairman is Deborah Wood, head of Healthcare Services at accountants Moore and Smalley.

AISMA, a national network of accountancy firms providing expert advice to medical practices, sessional GPs and hospital doctors, currently has 77 members. Mr Senior comments: “My aim is to help AISMA members drive home the message that GP practices need to improve efficiency if they are to sustain profits in these difficult economic times. Despite government pledges to maintain frontline services, doctors will inevitably feel the pinch as health service cuts begin to bite. Combined with the tax changes that lie ahead doctors are going to be affected, some quite dramatically.”

Under Mr Senior’s leadership, AISMA will continue to work with the BMA to influence policy. He says: “We will play our role in making the government aware of how proposed cuts will translate into reductions in service.”

Doctors wishing to contact their local AISMA member for accountancy advice can find details by clicking here.

Members of the Association of Independent Specialist Medical Accountants (AISMA) have raised over £13,000 for independent humanitarian medical aid organisation Médecins Sans Frontières. The AISMA Big 15 fundraising challenge celebrates the Association’s 15th anniversary and marks 15 years of high quality, specialist accounting services for the medical profession. Sponsored events organised by AISMA accountants throughout the UK have included walking 15 miles, climbing the 15 Peaks, cycling 150 miles, shedding 15lbs, together with dress down days, cake sales and quiz nights.

At AISMA’s annual conference, held at Eastwood Hall, Nottingham, on Thursday 13th May, Sam Knight, Digital Fundraising Officer, Médecins Sans Frontières joined AISMA accountants to cheer on committee members Luke Bennett and Andrew Johnson as they undertook a gruelling 15km indoor running and rowing challenge. Later Mr Knight spoke to the conference delegates about the work carried out by Médecins Sans Frontières in Amman, Jordan where surgeons provide complex reconstructive surgery for Iraqi children suffering devastating injuries from the continuing violence across the border.

Head of Fundraising at Médecins Sans Frontières, James Kliffen, says: ‘MSF is a charity close to the hearts of many doctors. We are delighted that AISMA has decided to raise funds for the charity which will go directly to our Amman surgical project.’

AISMA hopes to raise a total of £15,000 for Médecins Sans Frontières. Doctors wishing to donate can visit www.justgiving.com/aisma

AISMA committee members Andrew Johnson (left) and Luke Bennett (centre) are joined by Sam Knight, Digital Fundraising Officer, Médecins Sans Frontières (right).

A firm specialising in medical accounts will:

Prepare accounts in a standard format ensuring that income and expenses are not netted off. If expenses are set against the income source rather than being shown separately, the true expense of running the practice will be understated. If these accounts are then used by the Review Board this will reduce the pay award.

Compare your practice knowledgeably with other practices, both locally and at a national level.

Be aware of what the accounts should look like and which expenses claims can be made to minimise Revenue enquiries.

Understand what claims should be made and what income is expected and notify you if there are unexpected or missing figures.

Keep abreast of material changes in NHS funding and warn you in advance of how these might affect your practice.

Have systems to ensure an agreed timetable with you to turnaround the accounts (and if charging on a time basis, not charge you for general learning time) whilst waiting long enough to finalise accounts to ensure all income is correctly included.

Understand the complications of VAT and dispensing practices.

Have at least one other person fully up to date with medical accounts so you are not dependant on a single point of contact.

Help you to prepare meaningful budgets and make calculations for available drawings.

Be able to help out on a temporary basis with the finance side of the practice if there is a gap between practice managers.

Errors frequently made by non-specialist accountants include:

Netting off income and expenses.

Miscalculating debtors (amounts due for work done but not received), resulting in the risk of Revenue enquiries and income being allocated to the wrong partners (if there is a partner change from year to year). This also runs the risk of moving income into a higher tax bracket.

Incorrect tax treatment of pension contributions paid or due to be paid, resulting in the wrong tax relief being applied.

Incorrect completion of pension certificates, resulting in adverse affect on final pension payments.

Allocating profits incorrectly, particularly regarding employer pension contributions, this can affect the balances due to or from partners. This often causes problems where one partner has left the NHS pension scheme.

Miscalculating National Insurance contributions where there is a mix of self-employment and employment.

Including income to which PAYE has been applied in the accounts, resulting in the income being taxed twice.

Failing to show capital accounts and current accounts separately so that property ownership is confused.

Neglecting to pre-share items of income that the partners draw as a prior share of profits (so partners’ current accounts become incorrect).

Not understanding pension rules for locums – and incorporating their business without considering the cost of pension lost.

Specialist medical accountants will also be able to provide access to other experts specialising in the medical profession, such as solicitors, valuers and advisers on VAT, capital allowances and independent financial planning, either in-house or through their own network of professional contacts.

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