Pensions tax deadline warning for NHS staff

10 February 2022

Quilter has warned NHS staff of a looming pensions tax deadline which could lead to unnecessarily large bills if precautions aren’t taken.

GPs have until 11th February to file for 2019/20 annual allowance compensation to cover their annual allowance tax bill for that year or be forced to foot a large tax bill.

A Freedom of Information request by Quilter showed that 72% of NHS pension scheme members who have exceeded the standard annual allowance in 2019/20 have opted for their scheme to pay their annual allowance tax bill.

However, more than a quarter (28%) of staff who have breached the standard allowance have not elected for scheme pays and will need to pay it themselves.

Furthermore, Quilter said there remains an unknown number of GPs who have not completed the paperwork that will be subject to annual allowance charges caused by the tapered annual allowance this measure sought to address.

Graham Crossley, NHS pensions expert at Quilter, said: “There is a big risk that lots of GPs will not have completed the necessary paperwork to take advantage of the annual allowance compensation policy and will ultimately suffer large tax bills that they will have to foot themselves.

“With the NHS stretched, it is proving to be an incredibly busy time for GPs and understandably filling out complicated pension paperwork can prove tricky. To add insult to injury many GPs have not been issued the right information yet that enables them to work out if they even have an annual allowance charge for 2019/20.

“While the pandemic, at least in the UK, seems to be subsiding there is still significant pressure on medical services. There is no valid reason for any deadline to be imposed for the annual allowance compensation policy and we call for this deadline to be scrapped to allow GPs to get their paperwork in order.”

Professional Paraplanner