Sandison Lang Client Newsletter - Spring 2023

Sandison Lang news

WILL CHANGES TO PENSIONS TAX HELP TO RETAIN THE WORKFORCE?

The pensions tax changes announced in the Budget have now come into force as the new tax year starts. In a bid to retain more senior clinicians who were leaving amid punitive tax payments on their pensions’ growth, Jeremy Hunt removed the tax charge from the lifetime allowance and increased the annual allowance by fifty per cent.

After many years of significant anguish for doctors tied into fixed pension contributions which trigger excess pension savings, it surprised many to be given some positive news.

In the immediate aftermath of the Budget, Labour vowed to reverse the decision to remove the lifetime allowance should the party be elected. However, it has been suggested that NHS members could be exempt in the same

way that the judiciary is treated separately.

Pensions’ tax has always been a political football which can seem frustrating when we consider that the focus should be on stable and responsible saving for future provision.

The news surrounding the lifetime allowance has some drawbacks too – it was later confirmed that the maximum pension commencement lump sum (the ‘tax-free cash’ when pension benefits are drawn) will remain at the level of £268,275 (25 per cent of the current lifetime allowance figure of £1.073m).

This limit will not apply if individuals have previously applied to ‘protect’ a higher level of tax-free lump sum with a scheme such as fixed protection or enhanced protection. However,

many will be paying 40 per cent tax on their larger savings pots in retirement.

Tackling the annual allowance has brought welcome relief for many senior clinicians. The limit has increased from £40,000 to £60,000 with the minimum tapered version now back at £10,000. You can also earn more before the taper applies. The ‘adjusted income threshold’ will increase from £240,000 to £260,000. Adjusted income includes your NHS pension growth and any personal pensions, on top of your work earnings, investment dividends and buy to let income, for example.

If you have any queries about the measures announced in the Budget, please do not hesitate to contact your accountant.

Dr Mark Martin: NHS round up

hour limit on the number of hours worked in the first month has been removed.

Partial retirement

From October 2023, doctors can retain their current role (including the same terms and conditions of their contract) while accessing partial retirement. The new plans give those aged 55 and above, the choice to take up to 100 per cent of their pension benefits.

The advantage here is that doctors can retain their same job role – this was often not the case when they previously chose to ‘retire and return’ and lost their status, allowances or benefits in the process.

flexibility in the 1995 scheme at the time of the exercise.

Inflation

The date that the 2015 pension scheme is revalued each year has now been moved from 1 April to 6 April. The aim is to remove the valuation anomaly producing skewed pension growth and subsequently, larger pension tax payments.

McCloud Remedy

Just before the pensions’ tax news was announced at the Budget, the conclusion of the government consultation into NHS retirement flexibilities was published. Together, the new measures offer opportunities for those planning future options. Of course, they also add extra complexity to already convoluted regulations and should be considered carefully, ideally as part of your wider financial plan.

Pensionable re-employment

Doctors in the 1995 scheme can now ‘retire and rejoin’ – effectively retire, draw their NHS pension benefits and rejoin the 2015 scheme to accrue further benefits. There is a minimum 24hour break before rejoining but the previous 16-

One important consideration however, is that those choosing this option must reduce their pensionable pay by at least 10 per cent. We await guidance from the DHSC on the exact conditions required but there could be an option to make some PAs non-pensionable as part of an agreement with the employer.

Choice 2 election

The consultation stated that some members who moved their accrued 1995 scheme benefits into the 2008 section as part of the previous ‘Choice 2’ election will now be offered the opportunity to reverse their decision as part of the McCloud Remedy. It is believed that members may have moved previously because of the lack of

Viewpoint: William Myatt, partner

us. Somewhat odd though, considering the Office of Tax Simplification – the independent adviser to the government tasked with simplifying the UK tax system –was closed down by Number 10 in March after 13 years.

One could argue whether the Office was a success in that time. In 1995, the ‘tax code’ legislation ran to 5,000 pages, grew to 10,000 pages in 2010 and now sits at over 20,000. Making Tax Digital was also supposed to make things easier for businesses with improved efficiency and planning but clients tell us otherwise.

In March, a further 12-week government consultation was launched (McCloud part 2) to discern how the McCloud Remedy will be implemented. To recap, the remedy is the plan to alleviate the deemed age discrimination caused by moving some members to the 2015 scheme.

Affected members will be able to choose between remedial benefits from their new scheme or from their legacy scheme for their service during the remedy period which is between 1 April 2015 and 31 March 2022. The remedy is due to be implemented from 1 October 2023 but it is believed there have been significant delays to the legislative paperwork needed.

If you have any queries concerning your own plans for retirement, please do chat to your accountant in the first instance.

Firstly, the current cash basis method of producing accounts, which is used by four million sole traders in the UK, will be evaluated and then there is a review of the key forms and documents smaller traders must use.

It might also be time to increase general education on tax payments too. A recent study by Barclays found there was ‘persistent confusion’ around tax bills. The survey showed that one in three of those earning over £50,000 do not know their current tax bracket and more than a quarter of those with an income over £100,000 do not know the threshold for needing to complete a self-assessment tax return.

At the Budget, the Chancellor promised he would introduce a ‘simpler tax system for small businesses’ – music to the ears of all of

Instead, Jeremy Hunt announced a number of tax ‘consultations’ as well as a ‘discussion document’ with the eventual aim of making tax obligations more straightforward.

Of course, no such education is needed among our clients. Please remember to action your July payments on account in good time to avoid late payment penalties.

Sandison Lang interview with Dr Edward Stoner

point. That’s the big, fundamental change – not craning your neck down to see things but looking up at digital images on a screen.

We also have capsule endoscopy now where patients can swallow a pill containing tiny cameras that send information to data recorders. This was not originally available in the NHS, in fact, not even in many private hospitals initially because the kits cost around £30,000 when they were first introduced.

patients on the ward and wouldn’t want to document everything which is the requirement these days.

Have you moved to video call consultations? We can video call or telephone but the vast majority of appointments are back to being face to face which is much better. The patients want to see the doctor and it is much more productive all round.

Dr Edward Stoner graduated from Manchester University Medical School in 1990 and undertook specialist gastroenterology training at the Royal London Hospital and district general hospitals.

He was awarded a MD for his thesis on Sphincter of Oddi manometry by the University of London in 2000 and in the same year was appointed Consultant Gastroenterologist at Princess Alexandra Hospital.

Why medicine?

Medicine was by default – I was at a state comprehensive and was reasonably clever in the class so as a result we were pushed into medicine or dentistry or something similar. I was more science based so moved towards medicine but there were no other medics in my family.

At the beginning, as undergraduates, the rote learning that we had to do to learn anatomy was not my forte. Medicine didn’t click for me really until I got into seeing patients and began to enjoy the clinical side of things. At that stage, everything slotted into place.

Why gastroenterology?

I wanted to do something practical but didn’t fancy the surgical exams. I didn’t want to do any more anatomy and thought I had done enough. I did an elective in gastro in Jersey and had a great time there. I used to do a lot of sailing and all the local doctors had yachts so it was a really enjoyable time.

You have witnessed amazing advances in technology in your career…

When I first started you looked down the scopes directly as there was no video endoscopy at that

I took a leap of faith and invested to buy a kit myself rather than waiting for hospitals to set up services. The risk paid off as I was able to establish one of the first private services and I believe it paid for itself after around 100 patients in an 18 month period.

What has been the most rewarding part of your career?

I have been through a lot of medical management posts in the NHS but the most rewarding thing is my private practice. It’s fundamentally how I want to practise medicine – giving patients the time and providing individual care.

The NHS can be a bit ‘fire and forget’ medicine. You send off patients for tests and hope they come back. They may not even see you if and when they do come back. With private practice, it is much more individualised. You provide the care directly and it’s rewarding.

For example, I saw a young lady recently who I have known for 20 years. I first saw her when she was 15 and she’s now 35. She trains guide dog puppies and she’s on number eight now which is another indication of how long we’ve known each other.

Do you still have an NHS base?

I have one session alternate weeks providing therapeutic endoscopy and the more tricky stuff that the hospital is unable to provide.

In the pandemic I went back into the NHS and provided support together with another colleague who is also largely private. Therapeutic endoscopies were continuing so we were able to help. It was nice to go back to the wards although I am glad I am not doing it all the time.

I have thoroughly enjoyed medicine but it is different now. I wouldn’t want to spend the time doctors do on computers. I much prefer seeing

The art of medicine is largely listening so you can do that by phone taking the history etc but it is much easier to keep the patient focussed when meeting in person, calming their concerns and developing the line of questioning from cues and feedback.

Have you had a mentor in your career?

Yes we had a great, fun team in Manchester where I did my first house jobs. Dr David Maxton who was a gastroenterologist and Professor Trudie Roberts, a physician.

David was also good friends with Dr Colin Ainley in London and between them, they got me on the London rotation. It rains an awful lot in Manchester so moving back was always on the cards.

Now I teach not only trainees but also consultant colleagues in therapeutic endoscopic techniques so they can provide a service when I am not around and take over eventually.

Do you have projects on the go or retirement plans?

I am strategically planning my retirement and this year I aim to complete a medicolegal certification. I have done a bit of this work but not much because of lack of time. It is a five-day course with Bond Solon with certification by Cardiff University. My son is studying there so we will both be students.

The idea is that I can then work remotely as and when I want to. We have a place abroad so this will provide a degree of freedom.

I don’t want to retire completely on one day as that does not seem particularly healthy but I also do not want to work until I’m 70 and not have time to enjoy retirement.

How do you relax?

I am a keen kite surfer and currently planning my annual trip to Dakhla in Morocco. This is a

Sandison Lang interview continued

big lagoon in the western Sahara. Just like skiers checking the snow forecast I’m now starting to look at the weather to see if it’s going to be windy.

It can feel a little like being on an Exocet missile flying through the air and I definitely drank some of the lagoon the first time I was there but I really enjoy it. I love all water activities.

Thanking you for thinking of us

Congratulations to Dr Manos Astrinakis who wins £1,000 in our latest refer-a-friend prize draw.

Do you have a friend or colleague who could benefit from our specialist services? Simply

Q&A

email their contact details to us to be entered into our bi-annual draw. (Please do mention that we might be in touch.)

You will also receive an entry into the draw if a friend or colleague mentions your name when they first enquire to Sandison Lang. You

Best piece of advice received or given?

For me it’s work hard but play hard. You need to reap the rewards of this career and holidays are very important.

We all need our down time. I already have, and always have had, dates in the diary when I can take time off. We work long hours and we deserve the reward that goes with it.

may refer as many people as you wish – for every person that you suggest, you will receive another entry into the competition which will be drawn in November 2023.

Many thanks for supporting our business.

Q: Can I still submit P11D forms in paper format?

Michelle Trivett writes: A P11D is used to report expenses and benefits paid to directors and employees which have not been subject to PAYE tax. The form must report all benefits in kind and include any goods or services received from the company in addition to regular salaries.

Examples of benefits to be recorded include private health insurance, company vehicles and fuel, other loans or financial benefits, staff entertainment including social events, and any goods or assets for personal use.

There are many more benefits which should be included so if you are unsure if the item is taxable, please contact your accountant for clarification. You can also visit www.gov.uk/ expenses-and-benefits-a-to-z for a full list.

The annual deadline for P11D forms to be submitted to HMRC for your employees is 6 July but sadly, paper forms are no longer accepted. Employers must now submit P11Ds electronically via HMRC’s PAYE online service. If you benefit from our payroll service, we can submit the forms for you. Simply confirm by email to emma.richards@sandisonlang.com or telephone 01732 365351 as soon as possible.

A reminder that we have relocated our London office to New Cavendish Street. Should you prefer to meet with your accountant in town or have documents to deliver to the London office, please note our new address with immediate effect is:

Sandison Lang

The Harley Building, 77 New Cavendish Street, London, W1W 6XB

Our main office is still Tonbridge and our group telephone number remains 01732 365351.

Specialist accountants to the medical profession

2 St Mary's Rd Tonbridge TN9 2LB 01732 365351 office@sandisonlang.com

www.sandisonlang.com