Revenue offers cure for tax-risk docs

HMRC is offering an amnesty to medical consultants with unpaid tax liabilities. These include doctors, hospital consultants, dentists, cosmetic surgeons and associated professionals.

Revenue officials claim that some medical professionals are understating their UK taxable earnings, thus paying less tax than they should.

HMRC wants to cure errant medics of their bad habits and is offering an amnesty sweetener for anyone willing to swallow the medicine and own up to unpaid tax.

Doctors opting for the offer must pay the tax they owe, but will only face a reduced penalty of 10 per cent.

There are more than 3,800 medical and dental professionals, excluding GPs, working in hospital and community settings in Northern Ireland. Just over a third (35%) are medical consultants.

Called the Tax Health Plan (THP) the amnesty was launched on 11st January 2010 and gives medical professionals until 31st March 2010 to register their intention to disclose untaxed income.

"The revenue is getting tough on the professions it suspects of short-changing on their tax." warns PwC tax partner, Martin Fleetwood.

"Medical consultants and professionals who have underpaid their tax need to make a decision and be prepared to come clean.

“Any medical professional who believes that he or she may have underpaid tax should take professional advice immediately, but also accept that they face some difficult questions.

“HMRC is targeting this group for a very good reason and anyone who should avail of the amnesty but declines could face unpleasant consequences, including substantial financial penalties, prosecution and even prison.”

The Tax Health Plan (THP) is a follow-up to the general amnesty, the New Disclosure Opportunity (NDO) which began on 1st September. This offered an amnesty to taxpayers with undeclared offshore bank accounts and who owned up before 4th January 2010..

It is believed that a number of Northern Ireland taxpayers with substantial offshore accounts were targeted by HMRC investigators seeking a reputed £2bn of undeclared UK deposits in secret offshore accounts.

Under the Tax Health Plan (THP), disclosures must be completed on special forms and payment made to HMRC by 30th June 2010.

Martin Fleetwood offers some tips to medics considering whether they should disclose:

• Don’t prevaricate: act now to avoid becoming a target of an HMRC investigation; 
• Gather all the information necessary to help calculate the tax and interest due and, for medical consultants in private practice, ensure your accounts are up to date; 
• Make immediate contact with a specialist adviser who understands exactly what type of evidence will be needed to ensure your disclosure is accepted without protracted enquiries from HMRC.

Contact details
Email: Martin Fleetwood
Tel: +44 (0)28 9041 5486