National Insurance and Consultants
Am I paying too much National Insurance?
Many consultants have at least two sources of income:
- NHS Salary
- Private Practice
Both these sources of income are liable to National Insurance Contributions (NICs). A consultant will pay NICs on their NHS salary as well as on their private practice income.
Keeping your NICs as low as possible
There is, however, a maximum amount of National Insurance Contributions which any individual tax payer has to pay in any year.
Normally your accountant will apply to have the National Insurance Contributions on private practice income cancelled or ‘deferred’. This is because normally a consultant will have paid the maximum National Insurance Contributions due on their NHS salary alone.
Avoiding accidental overpayments
However, in our experience, it is not uncommon for this ‘deferment’ to be missed by an inexperienced or non specialist accountant. If the accountant does not request that the National Insurance Contributions are deferred, the consultant will pay more national insurance than is due.
The Inland Revenue has no procedure to prevent this from happening so they won’t tell you when it does. It is not unusual for a consultant to be paying £2,500 per annum in unnecessary contributions.
The consultant will receive no additional benefits for these unnecessary additional contributions.
How we can help with National Insurance
One of the first things we will do when appointed to act for a consultant is to check what National Insurance Contributions are being paid to see if you are overpaying.
If it turns out you are, then we can even claim back the overpayment going back up to 4 years.
