NHS Doctors – 2019/20 Scheme Pays Election & Compensation Policy Application

3rd February 2022

The extended 31 March 2022 deadline for NHS Doctors to submit their scheme pays elections and compensation policy applications for the 2019/20 tax year is fast approaching.

 

For those NHS Doctors that suffered an annual allowance pension tax charge in the 2019/20 tax year had the option to either pay the charge directly to HMRC through self-assessment or elect to use the scheme pays facility, where the NHS Pension Scheme would be responsible for paying the charge to HMRC. The scheme pays function would result in a permanent reduction of your pension at retirement to recover the tax settled for you.

 

Individuals that have completed their 2019/20 tax return on the basis that the annual allowance pension charge was paid, must complete a scheme pays election (SPE2) by 31 March 2022.

 

Additionally, for the 2019/20 tax year only, NHS England introduced a compensation policy for NHS Doctors that went over their annual allowance and used the scheme pays facility to pay the tax charge can apply to be fully compensated in retirement for any reduction to their NHS Pension Scheme income.

 

As with the scheme pays election, the compensation application deadline is 31 March 2022 (for GP’s, the deadline for submitting the compensation application is 11 February 2022), although the scheme pays election must be submitted first otherwise the compensation application will not be accepted.

 

Should you have any concerns regarding the scheme pays election and/or the compensation policy application, please contact your usual Whitings contact in the first instance.

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