Accountants for Medical Locums & NHS + Private Consultants
NHS consultant plus private practice is one of the most tax-complex freelancer profiles in the UK. NHS superannuation, Ltd company dividends, pension annual allowance taper, £100k cliff — all interacting. Accountants in our network run it annually.
How do you work?
Medical locums and consultants running private practice alongside NHS roles face a specific combination of tax issues that few accountants handle properly. NHS work is PAYE, feeding into NHS superannuation. Private practice usually runs through a limited company with salary/dividend optimisation. On top of both sit the annual allowance taper (which kicks in hard at senior consultant income levels) and the £100k personal allowance cliff (which is genuinely difficult to avoid at this earning bracket).
Get the structure wrong and the tax bill is substantial — pension annual allowance breaches, wasted dividend allowances, avoidable higher-rate dividend tax, and NHS super contributions that don't coordinate with private Ltd pension contributions. Get it right and the savings per year are genuine.
Tax questions specific to medical locums & nhs + private consultants.
NHS PAYE + private Ltd
Standard structure: NHS via PAYE consultant contract (unchanged), private practice via Ltd. The Ltd gives dividend timing control, employer pension contributions, and spouse shareholder flexibility.
The annual allowance taper
With threshold income over £200k and adjusted income over £260k, the £60k pension annual allowance tapers down by £1 per £2 of excess, to a floor of £10k. Carry-forward becomes critical.
The £100k cliff edge
Between £100k and £125,140 of adjusted net income, personal allowance is withdrawn at a 60% marginal rate. For senior consultants, staying below the cliff via pension and dividend timing matters.
NHS superannuation + private pension
NHS pension contributions count toward your annual allowance alongside any private pension contributions. Coordination is essential to avoid accidental breaches.
IR35 on locum engagements
Post-2021 rules mean NHS-engaged locums are scrutinised. Most regular GP locum work is outside IR35 when structured correctly; long-running hospital locum placements are often inside.
Medico-legal income
Expert witness and medico-legal work is separate self-employment — usually invoiced through your Ltd. Different IR35 considerations; single-engagement expert reports rarely raise concerns.
The five-lever annual plan for a consultant with NHS + private income.
Senior consultants routinely cross every important tax threshold — £100k, £125k, £200k threshold income, £260k adjusted income. Five annual decisions determine how much you keep.
1. Ltd director salary
Usually £12,570 (personal allowance) if you have no other PAYE — but NHS consultants already have PAYE. So the Ltd salary often drops to zero, with everything taken as dividends. The exact optimum depends on NHS salary level and private practice profit.
2. Pension contribution sizing
NHS superannuation + private Ltd pension contributions together must not exceed your tapered annual allowance. For most senior consultants the taper is fully engaged, leaving only the £10k floor — which NHS super alone often consumes. Private Ltd pension becomes marginal or counter-productive at this level.
3. Dividend timing
With NHS salary already filling most of your tax bands, Ltd dividends immediately hit higher and additional rate. Spreading dividend extraction across tax years (holding in the company vs drawing) is where meaningful planning happens.
4. Spouse shareholder
A spouse with unused personal allowance and basic-rate band can hold a shareholding and receive dividends at 8.75% vs your 33.75% or 39.35%. For senior consultant Ltds, this is one of the highest-value arrangements available and entirely legitimate when set up properly.
5. Staying below £125,140
If adjusted net income crosses £100k, personal allowance tapers away by £1 per £2, fully gone at £125,140. For consultants with NHS + private income mix, pension contributions or deferred dividends are the only levers — the matched accountant models both annually.
The services most medical locums & nhs + private consultants use.
Tax Returns
Get matched with a qualified accountant who specialises in freelancer self-assessment returns.
Read moreIR35
Get matched with an accountant who specialises in IR35 contract reviews and status determinations.
Read moreSole Trader
Get matched with an accountant who handles sole trader accounts end-to-end.
Read moreContractor Ltd
Get matched with an accountant who specialises in contractor limited companies.
Read moreIndustry-specific questions.
I'm a GP locum working through practices. Sole trader or Ltd?
For GP locums invoicing practices directly, sole trader is usually fine up to £50-60k of annual income. Above that, incorporating starts to win — timing control, employer pension contributions beyond NHS super, and spouse shareholder flexibility. Post-2021 IR35 rules mean regular practice locum work needs careful positioning; most GP locum engagements are outside IR35 when structured correctly.
I've had an annual allowance breach — what happens?
Annual allowance breaches result in a pension tax charge. You can pay it via scheme pays (deducted from your pension benefits) or personally on self-assessment. For senior NHS consultants with substantial NHS super contributions plus private pension, breaches are common. Carry-forward from previous years often absorbs them — we check three-year carry-forward as part of every annual review.
Can I claim CPD, Royal College fees, and defence body subscriptions?
Yes — all fully deductible for medical freelancers. Royal College fees, GMC annual retention, MDU/MPS/MDDUS defence subscriptions, journals, conferences, CPD courses, specialty society fees. For senior consultants these typically total £3,000-£7,000 annually — fully deductible against private practice income (or adjusted on PAYE via Section 336 claim for the NHS-side element).
How do I handle medico-legal expert witness work?
Usually through your Ltd, invoiced to instructing solicitors. Medico-legal engagements are typically single-instruction, outside IR35 by nature (no ongoing relationship, no control, no mutuality). Record-keeping matters — timesheets, report dates, billing records. Solicitors often pay gross; CIS-style deductions don't apply to medico-legal work.
What's the best way to handle my pension if I'm LTA-close?
The Lifetime Allowance was abolished in April 2024 and replaced by lump sum allowances. For senior consultants with substantial NHS super pots, the relevant limits are now the lump sum allowance (£268,275) and lump sum and death benefit allowance (£1,073,100). Planning around these, plus the annual allowance taper, is specialist territory — we coordinate with your IFA on the pension-specific strategy.
Can my spouse be on my company payroll?
Yes, if they genuinely perform work for the business (practice management, admin, bookkeeping, appointments). Payroll salary must be commercially reasonable for the hours and duties. For consultant Ltds, a spouse salary of £10-15k/year plus a shareholding is a common and legitimate setup that HMRC accepts when properly documented.