Are you worried about topping out on your NHS pension?

So.. you’ve been in the NHS for twenty years, and your accountant has written to you to say that you’re about to reach the limit of pension contributions in your NHS pension pot before you’re fleeced for more tax.

You’re not dead yet and you fancy working for a bit longer, whilst the kids are still at school. So, what do you do? Slaving away to give tax on tax to the tax man doesn’t inspire you. So, what about private practice? Might there be a way to set a business in private practice that is much more tax efficient and won’t erode your pension pot?

Here’s a great suggestion…..

What if you were to consider setting up an LLP (that’s limited liability partnership in lay man speak)? An LLP is basically when two or more people (or companies) get together and form a big happy partnership. A partnership means more ‘buying’ or negotiating powers, sharing of costs, better marketing opportunities, and having a business buddy (or two) to share your journey.

But, what could you do with that LLP? So, imagine you’re a consultant orthopaedic surgeon, and currently (when the family lets you), you turn up to do an NHS ad-hoc surgical Saturday list. You arrive to find half the staff are missing, and you’ve been booked a list of anal fissures. Great. You are SO frustrated as you know this wouldn’t have happened if you were in control of managing the shebang. Well, your LLP could do just that.

Here’s the best bit. When you do this kind of waiting list work within your own Trust as an individual, the Trust indemnifies the work. If you’re in an LLP working in your NHS Trust to service their lists – the NHS also indemnifies your work. That way, you are doing extra work in the NHS, improving the efficiency of the lists, but not having to indemnify the work. So compared to undertaking private work on a Saturday, you’ll have less to indemnify…..you get to keep more money and the list runs like clockwork.

It’s a win- win, because the NHS Trusts also see the benefit of more engaged consultants, and therefore they’re much more likely to want to work with LLPs. NHS staff are also keen to turn up to work, because they’re paid a bit more too. Finally, this kind of work attracts the those eager folk you’d really like working with.

So, bringing it all together – how does this help my bottom line, you may be thinking? We know the answer to this – which is that you’re not being paid a sessional rate, but instead, the whole team gets paid on a case by case basis. Due to the improvement in efficiency and because you get paid for the work you actually do, we reckon this adds up to a net income improvement of about 30%. Sweet.

Want to know more about getting into LLPs and not max out on your pension? Drop me an email at barrs@trusthealth.co.uk

Published on in Medical partnership, Trust Health News.