Following a change in legislation, GPC has produced initial new guidance on the tax and NI treatment of locums supplying services through intermediary organisations eg. limited companies; this is now available on the BMA website:
This is clearly highly relevant to all locums and to all GMS/PMS practices engaging locums using intermediaries. In a nutshell from 5th April it will be practices’ responsibility to decide whether IR35 applies, and if it does to deduct appropriate tax and employees and employers national insurance contributions from the locum. Note this does not apply to locums engaged by APMS providers. Additional guidance on this matter for practices from the GPC is also expected very shortly.
Please be aware that the broader issue of the employment status of any locum remains unchanged by this legislation. As per previous LMC advice, any locum working regular sessions in a practice without an agreed period of engagement may be considered by HMRC as an employee; similarly any locum working for a period longer than six months may be considered as an employee by the NHS Pensions agency. Practices engaging locums on such terms, and their locums need to be aware of their potential liabilities in respect of PAYE and national insurance payments should HMRC choose to take an interest in their arrangements.
The HMRC employment status website is helpful:
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