Tax for the new GP

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Tax for the new GP

• Course Organisers

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Before you start

• Get an accountant theyll pay for themselves
• Self employed within 1 monthregister yourself
  as self employed (100 fine)register for Class 2
  NIC (c2.10/w)

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Documentation

• Collect everythingReceiptsCertificatesBank
  statements etc

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Tax burden
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Paying tax

• Complex system of 2 annual payments Payment
  on accountBalancing payment
• Essentially nightmare for first 2-3 years of self
  employment as always chasing your tail
• Payments due in January and July each year (based
  on previous years profits)
• Submissions of accounts by 31st January online

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What can you claim relief on?

• You pay 40 on all your earnings gtc34K
• You can claim relief on a proportional amount of
  that ie
• You buy a stethoscope for 100It is 100 for
  business purposesYou claim 40 relief ie 100 of
  40 of 100
• Or you buy a computer for 500It is 25 for
  business purposesYou claim 50 relief ie 25 of
  40 of 500

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Relief

• Car
• How much do you use your car for business? i.e.
  not to and from work. Only include business
  travel i.e. visits, meetings etc
• If used 30 then allowance is 30 of (40
  expense) 13.3 reliefMaximum allowance
  14,400 this is the maximum values of any car
  do dont buy an expensive one for tax
  savings!Exception is low emission cars
  (lt120gm/km) e.g. Audi A2Big savings only in year
  1 of ownershipAllowed small amount in
  depreciationAll car related bills insurance,
  road tax, services, MOT, tyres, cleaning
  etcFuel
• Also consider car loan offset interest on loan
  e.g. AA Car loan 5.6 becomes 4.86 (5.6-13.3
  relief based on 30 car use)

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Travel

• Bicycle
• Public transport keep tickets
• Parking costs (not fines!)
• Not walking!

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Professional memberships

• 100 of 40 as entirely linked to
  roleBMAGMCRCGPMPS/MDUASME/AMEE
  etcJournals etc
• CANNOT claim for examination fees but you can
  claim on courses

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Professional equipment

• StethoscopeOtoscopes etc
• Books (no limit)
• Clothes NOT covered unless uniformPossibly dry
  cleaning if caused by body fluid
• Mobile telephone (proportional use)

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IT

• Computer (limit on cost)
• Internet connection
• Software/hardwareProportional costs

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Working from home

• Must do substantial amount of work from home in a
  room designated for that purpose
• Based on area of room as compared
  houseMortgage interestUtility costsSecurity
  costs
• May make you liable for capital gains tax upon
  sale of house

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Other things you may be liable for

• Tax on other self employment
• Bank account interest (is it deducted at basic or
  higher rate by your bank)Get an ISA!!
• Class 4 NI (all self employed persons)

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Class 4 NIC

• 8 of profits 4,895-32,760
• 1 all profits thereafter
• Due to change slightly as a result of budget 07
• May interfere with any employed work as you
  already pay Class 1. Get an accountant

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Pension contributions

• Get an accountant!

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Practical guide

• Get an accountant
• Collect everything
• Make a database (for everything you can imagine
  the accountant will always advise you what you
  can/cannot claim)