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Medics Money podcast
Ep 255: Could GPs save tax with a limited company? Q&A
Feb 18, 2025
The podcast dives into the financial intricacies of GP practices, debating the pros and cons of adopting a limited company for services. It uncovers crucial tax implications and legal hurdles that come with this option. The conversation shifts to managing adjusted net income, particularly for GP partners looking to stay under the £100,000 threshold. Key strategies for understanding pension contributions and tax relief are shared, along with insights into recent pension law changes. Practical tips and expert advice enhance financial literacy for medical professionals.
36:41
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Quick takeaways
- Utilizing a limited company for GP work may provide tax benefits but entails navigating complex tax regulations and withdrawal implications.
- Managing adjusted net income below the £100,000 threshold is crucial for GPs to avoid higher tax rates and optimize pension contributions.
Deep dives
Using Limited Companies for GP Work
Utilizing a limited company for GP work, such as private services like cremation forms and vasectomy services, presents both potential benefits and complexities. While the allure of decreased tax rates through corporation tax seems appealing, it is crucial to consider the full tax implications that arise upon withdrawing money from the company. Taking income from a limited company as salary or dividends often subjects it to additional taxation, which could lead to paying more tax overall compared to being a sole trader or partnership. Additionally, regulatory aspects regarding CQC registration and GMS contracts must be navigated carefully, as they impose restrictions that may complicate the establishment of a company for various GP activities.
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