Self Employment for Locums
Being self employed is relatively straightforward.
You will almost always provide a service directly to the client and not work through an agency.
You will need to complete an annual self assessment tax return and can offset business expenses against your tax bill. Self employment is not as tax efficient an option as working through a limited company (personal service company), provided that the personal service company does not have to apply the IR35 tax regulations or the ‘off payroll’ working rules.
Self employed individuals can claim expenses which are ‘wholly and exclusively’ incurred for business purposes. An employee can claim far fewer expenses. This means that a locum who is self employed will pay less tax and national insurance than a locum paid by a PAYE salary.
If you start to work as a self employed locum it is necessary to inform the Revenue when you start this type of work.
NHS Pension Forms A & B
If a locum GP provides self employed services to an NHS general practice, NHS superannuation contributions are due on the income received.
Superannuation is accounted for using Locum Form A and Locum Form B.
These forms can be downloaded from http://www.nhsbsa.nhs.uk/
Making provision for Tax and National Insurance
If you are self employed you will be responsible for making provision for your own income tax and national insurance and paying these to HMRC when they fall due. As a client we can advise you of the amounts and due dates to remind you to keep the funds available when due.
Working through an Agency
It is very unlikely that an agency will engage a locum on a self employed basis. The agency may be held responsible for a self employed locum’s unpaid tax or national insurance. So this is unlikely to be a viable option if you are working for an agency.
How can we help
- We can help you to inform the Revenue you have become self employed, registering for you to pay self employed tax and national insurance and assisting in the preparation of your self assessment income tax return at the end of the year.
- We can assist in the preparation and submission of all superannuation forms including Locum Forms A and B.
- We can advise you of the right amount of tax and national insurance to put aside to ensure you have sufficient funds to cover your tax bill when it falls due.
Starting out as a self employed locum doctor? See our Self Employed Checklist.