GPs set to miss out on compensation for pension tax charges
February 3, 2022
The Association of Independent Specialist Medical Accountants (AISMA) is calling for an extension of the 11 February deadline for GPs in England to claim for compensation against the pension annual allowance tax charge for 2019/20 because many GPs have not received the information they need to make a claim.
A special compensation arrangement was set up for clinical staff caught by the tax charge during the year 2019/20. Under the arrangement, members of the NHS pension scheme elect for the scheme to pay the tax charge on their behalf. When they retire, they are then compensated for the effect of the deduction on their income from the pension scheme.
GPs in England must first submit a ‘scheme pays’ election to NHS Pensions and then submit a claim for compensation to PCSE by 11 February 2022. Before they can make a claim, they need to receive a pension savings statement for the year from NHS Pensions. However, many GPs have yet to receive their pension savings statements and nor have their pension records been updated.
James Gransby, AISMA vice-chairman and partner at RSM UK Tax and Accounting, said: “GPs are unable to make an accurate claim for compensation if they don’t have information they need about the growth of their pension benefits. Through no fault of their own many GPs are at risk of losing compensation which could be worth thousands of pounds across the years of their retirement.”
Andrew Pow, AISMA board member and healthcare partner at Mazars, added: “GPs should be allowed a dispensation so that they can submit a claim at the point they have received information from NHS Pensions about their annual allowance charge for 2019/20. Any GPs who think they may be at risk of a charge should be talking to their accountants about this now and consider making an estimated claim.”