Starting up as a Locum

RE: Starting up as a Locum

Kate Cullen — Thu, 16 Mar 2017 14:39:46 GMT

Yes - we had a HMRC investigation & they came back with a superior HMRC man to focus on our use of a regular locum. All ok in the end but a degree of worry & a waste of a couple of days.

Our locum also provided her own acupuncture services so that helped. Plus although she did some ongoing thursday mornings she did often refuse some of those so that seemed to help. Occasionally her partner filled as a locum also.

RE: Starting up as a Locum

Julie Lavis — Tue, 14 Mar 2017 22:19:37 GMT

One thing which has not been covered if you are new to locuming is that it is wise to e mail the practice once a booking has been made to confirm the arrangements. Set out dates to be worked, on call, rates of pay, terms for payment. If accommodation, phones and vehicles are involved then include these in the confirmation e mail. Set out contact details, for both yourself and the practice. If there is more than one branch be clear about which place you need to be at on day 1. In effect you are creating the contract between you and the practice.

If you have never been there before get the post code for sat Nav and it helps to ask if there is safe parking nearby or if you can use practice parking.

Finally check the hours as some practices work 40-50 hours over 5 days and some do the same in 4 days with a day off. As most locum rates are based on a day rate it is hard to make one day rate fit both scenarios and no one will pay you for the day off on the rota if it is 4 long days. In my experience determining the hours to be worked can be particularly hard if working through an agency as they are the third party and like using a day rate whatever the hours.

These days most locums seem to book up a long time ahead? If that is what suits you it is wise to give them a ring a week or so before the start date to check there have been no changes since the booking was made.

Hope this helps

RE: Starting up as a Locum

J G Wray — Tue, 14 Mar 2017 17:37:38 GMT

I won't be making any comments about becoming a locum......

RE: Starting up as a Locum

Bob Russell — Tue, 14 Mar 2017 13:05:01 GMT

Merial decided to change the way it dealt with VAT on discounts. Don't know the details but I believe they started to claim it back so some practices received unexpected VAT bills. Happened about 12 years ago.

We were OK but I understand there were some pretty unhappy Frontline sellers!

RE: Starting up as a Locum

Edward Jones — Tue, 14 Mar 2017 12:14:24 GMT

[quote user="Bob Russell"]

Examples include [...] the big, famous one regarding VAT on discounts.

[/quote]

I must have missed that one. Could you expand on that, please?

RE: Starting up as a Locum

Bob Russell — Tue, 14 Mar 2017 11:40:30 GMT

If in doubt talk to HMRC.

There is an online checker:

https://www.gov.uk/working-for-yourself

Can you employ and pay someone else to do your job if unwilling or unable to work? Do you decide where and when you work?

I suspect the status of a number of people working regularly for the same organisation/employers are actually part-time employees rather than self-employed.

HMRC are on 0300 123 2326!!

RE: Starting up as a Locum

vs0u — Tue, 14 Mar 2017 10:44:12 GMT

[quote user="Malcolm Ness"]We were - twice and for different (foreign) locums who had returned home without paying their taxes. HMRC came after us because they knew where we were[/quote]

I was not very clear in my post - I meant, did anyone know of a self employed vet, or a practice using them, getting done by HMRC, in a case where the vet was actually declaring their earnings and paying the tax owed? Obviously HMRC will pursue people who avoid paying tax - that would apply in any model be it Ltd co or PAYE. In Malcolm's case their practice was not held liable so that shows that even if the vet avoids paying tax and leaves, the practice is still not responsible. If the locum actually does pay their tax, it seems unlikely that HMRC would quibble over exactly how many days they worked here and there, whether they provided their own stethoscope, etc. Does anyone know of this happening?

RE: Starting up as a Locum

mariette asselbergs — Tue, 14 Mar 2017 09:33:56 GMT

[quote user="Clive Ansell"]

[quote user="mariette asselbergs"]Our ECC service is set up on the basis that all of us, vets and nurses are self employed consultants. We have our rotas planned a year beforehand. HMRC is fully aware of how it is set up and has no problem with it. The essential part is the contract, which states specifically that everyone is responsible for their own clinical decisions, cases and consequences.[/quote]

That would not be good enough reason in itself.

We are all M'sRCVS, professionals in our own right, and therefore we are all responsible for our own clinical decisions, cases and consequences, regardless of employment or tax status. Being PAYE does not absolve one of professional responsibilities.

[/quote]

I suppose I don't know enough about this in detail, but if I work in an existing practice I have to follow the practice guidelines. Of course if i thought they were wrong, I could make a point of doing something different, but in general I have to follow what they tell me is their procedure for vaccinations, worming, flea treatment, neutering techniques etc. If there is a complaint, of course I will be involved dealing with it, but if there would be a complication following my surgery, I don't think I would be called back to deal with it, while in my present contract that would be my obligation.

Mariette

RE: Starting up as a Locum

mariette asselbergs — Tue, 14 Mar 2017 09:25:14 GMT

For our vets and nurses it is the same thing, but I think the essential issues in the contract are:

Total freedom and responsibility for your own work. The contract states specifically that there is no "master/servant" relationship. This will not often be the case if you locum in a normal day practice.
Obligation to fill the rota (in our case with 4 vets and 8 nurses our first choice is to swab with one of the others but occasionally we bring in another locum, which is true for the vet as well as the nurses.
It is also true that HMRC likes to see you work for some other practices as well, but this can be incidental (a few times a year). Most of our nurses do this, as do I, but not the other vets.

Mariette

RE: Starting up as a Locum

Bob Russell — Tue, 14 Mar 2017 09:24:54 GMT

The difficulty with HMRC is they may appear to be happy with an arrangement but unless you have it clearly in writing from them that it is OK, it may not be OK with the next inspector. A change in opinions tends to follow a change in attitude from those above.

I have seen so many occasions where the established 'rules' became overturned by HMRC without notice. Penalties then apply!

Examples include housing for assistants and the big, famous one regarding VAT on discounts.

If you think HMRC are happy then get it in writing or the next time they want to boost their coffers they may well come investigating!

RE: Starting up as a Locum

Arlo Guthrie — Tue, 14 Mar 2017 09:15:55 GMT

Malcolm Ness and mariette asselbergs - you've obviously got a lot of experience of this. I wonder if you've got an opinion as to where veterinary nurse locums sit?

Seems to me that there are a lot of nurses being advised that their work is IR35 and they have to pay tax accordingly.

BUT, one told me that they are audited by an accountant who advises whether individual contracts are IR35 or not, and invariably says they are. I can't help thinking that if the accountant is liable, then of course they'll err on the safe side and advise a contract should be IR35.

According to this website, the three principles are:

'control' (over where and when work is done). This would strike me as a case for most locum work to be IR35.
'Substitution'. mariette asselbergs - I'd imagine most veterinary surgeon locums and nurses do not currently commit to providing a substitute if they are unable to do the work. But your point is they could.
'Mutuality of obligation'. Clearly there is no mutuality of obligation, which is a case that locum work is NOT IR35.

I'm surprised that this doesn't mention the duration/frequency of work for the same client.

This is a new subject for me, and the problem is that I am told that opinions on the subject differ from one accountant to the next, even from one tax office to the next. Very difficult to get a definitive answer. I am wondering whether it is possible to get a definitive answer from HMRC. If not, then to gather together some cases from people like you, Mariette, which other members could show to HMRC in the event that they were challenged by HMRC.

RE: Starting up as a Locum

Clive Ansell — Tue, 14 Mar 2017 08:51:29 GMT

That would not be good enough reason in itself.

RE: Starting up as a Locum

Clive Ansell — Tue, 14 Mar 2017 08:40:48 GMT

[quote user="grumpyoldman"]I remember after the last foot and mouth debacle getting a steady stream of faxes from HMRC concerning the whereabouts of several foreign locums who had charged MAFF/DEFRA as it was then £400+ a day plus expenses ,for 8-12 months and promptly legged it back home to various parts of Europe and Australasia without paying a bean in tax or NI. I just wondered if HMRC made DEFRA pay their tax?. [/quote]

It surely must be possible to pursue tax avoiders/evaders across international boundaries, and presumably someone, agency or practice employer, has verified their identities somewhere along the line? (Id's are checked? aren't they ??)

My brother got a speeding ticket in Australia one boxing day, but did not learn of it until after he was home. The Oz authorities were prepared, quite literally, to pursue it to the ends of the earth, and threatened to do so through the English court system had he not paid.

RE: Starting up as a Locum

mariette asselbergs — Tue, 14 Mar 2017 08:07:07 GMT

Our ECC service is set up on the basis that all of us, vets and nurses are self employed consultants. We have our rotas planned a year beforehand. HMRC is fully aware of how it is set up and has no problem with it. The essential part is the contract, which states specifically that everyone is responsible for their own clinical decisions, cases and consequences. Everyone is responsible to fill the day (night, weekend) allocated on the rota. If you cannot work, you need to swab or provide another locum. There is no "master/servant" relationship. Obviously the practice provides the facilities, but we provide the skills and expertise. Our invoices state that we are working on a self employed basis and that we are responsible for calculating and paying our own tax and NI. We have been working like this for 6 years now and were inspected last year and it was OK. It helps of course if you record of paying tax is sound. For me it is important to keep this status not because it saves me tax which it doesn't, but because I can count my travel expenses as costs which is sort of important if your work adress is 170 miles from your home adress. My partner works as a locum consultant in the NHS (Reason being that parents are frail and we must be able to get up and move to Scotland to assist them on very short notice) and they work for months, sometimes years on end in posts where they can't find permanent staff.

Mariette

RE: Starting up as a Locum

grumpyoldman — Mon, 13 Mar 2017 22:41:08 GMT

I remember after the last foot and mouth debacle getting a steady stream of faxes from HMRC concerning the whereabouts of several foreign locums who had charged MAFF/DEFRA as it was then £400+ a day plus expenses ,for 8-12 months and promptly legged it back home to various parts of Europe and Australasia without paying a bean in tax or NI. I just wondered if HMRC made DEFRA pay their tax?.

RE: Starting up as a Locum

Malcolm Ness — Mon, 13 Mar 2017 21:44:25 GMT

We were - twice and for different (foreign) locums who had returned home without paying their taxes. HMRC came after us because they knew where we were. They tried to say that the locums were, in reality, employees and therefore we should foot the tax bill. We had adequate records to show otherwise so we were able to shake off HMRC but it was still a big waste of our time and money.

As Clive points out, regular part time work is just that and I know of several vets claiming to be self-employed locus while they are really regular part-timers. Sooner or later, HMRC will start pursuing them.

RE: Starting up as a Locum

vs0u — Mon, 13 Mar 2017 15:01:32 GMT

Has anyone ever heard of a self employed vet locum or the practice hiring them being done by HMRC? Can't help wondering if it's bit of scaremongering?

RE: Starting up as a Locum

Iain Richards — Mon, 13 Mar 2017 13:54:01 GMT

Indeed, my invoices (and those of locums I've used in the past) read, "For professional services"

RE: Starting up as a Locum

Clive Ansell — Mon, 13 Mar 2017 13:02:57 GMT

[quote user="Bob Russell"]

I fail to understand the issues with using practice facilities. It is the expertise you are selling rather than premises or equipment. A locum just expects to have suitable facilities for the practice type he or she is going to.

More important is whether you work regularly in a small number of practices. Here there is an argument that you are working as a part-time employee on a zero hours contract. Not a surprise that HMRC struggle with this!

[/quote]

I think that is absolutely right, and is in fact what I have been advised by both an accountant and a tax lawyer.

As a self-employed locum you are selling a professional service, usually to cover for colleagues on holiday or off work through illness. It would be reasonable and expected that you have your own small tools and equipment, stethoscope etc, but you would not have your own premises or MRI scanner.

If doing work on a regular basis for one or any number of practices; be that 1 week a month, every Tuesday, every other Saturday, whatever it is, then that would be classed as employment as far as HMRC are concerned.

RE: Starting up as a Locum

Bob Russell — Mon, 13 Mar 2017 11:32:06 GMT

HMRC are more worried about locum doctors being unavailable because of the NHS need for them!

Locum vets are an easy target as government does not rely on them.

RE: Starting up as a Locum

Iain Richards — Mon, 13 Mar 2017 11:00:25 GMT

It's curious how we as a profession get worried about HMRC. Locum doctors are a real dragon NHS yet none of the locum radiologists bring their own X-ray generator. The real test would be if you work for one practice only, because that is just part-time work. If you work for one or more, at irregular times, it's easier to argue.

RE: Starting up as a Locum

Arlo Guthrie — Mon, 13 Mar 2017 09:49:15 GMT

What a coincidence, I've been writing a guide to working as a veterinary locum for veterinary nurses over on vetnurse.co.uk, where I'm also trying to gather top tips from existing locums and employers. https://www.vetnurse.co.uk/jobs/w/veterinary-nursing-jobs-career-recruitment-advice/1080.locuming-guide.aspx

Lots of useful advice in this thread, and perhaps it would be useful if we produced a guide over here too.

RE: Starting up as a Locum

Robin Grimmer — Mon, 13 Mar 2017 08:49:59 GMT

I think Gillian makes a good point - it's difficult to justify self employed status with hmrc being a locum. As she says, you rely on the practice premises, staff and equipment. It does help having some of your own gear, plus dictating when you are available, working for a number of practices. What can really help your self employed status is being able to provide another locum if you are unavailable! If are doing regular hours for a practice then you could be on sticky ground!

RE: Starting up as a Locum

Robin Grimmer — Mon, 13 Mar 2017 08:44:17 GMT

I'm not sure what the future of ltd co locuming will be. With the new dividend tax kicking in after only £2000 of dividiends, in addition to Corporation Tax on company profits plus accountant's fees likely to be in excess of £1300. That's on top of all your running costs ie RCVS, VDS memberships, any other professional bodies, car, equipment etc.

I stopped being a Ltd co locum last year but am lucky that I work for a small number of practices that are ok with my self employed status, so don't need to bother with the corporates 3tc.

And yes as Clive says, you won't be able to do flat rate Vat any more. It used to mean you could retain £68 VAT for every £1000 of earnings. From April that will be just £1!

RE: Starting up as a Locum

Clive Ansell — Mon, 13 Mar 2017 08:27:37 GMT

[quote user="Clare Tapsfield-Wright"]

Critical illness cover

maybe private health insurance to schedule non urgent treatment

[/quote]

I've not bothered with that, seems too expensive. I have paid for appointments with consultants as I have needed them, only twice fortunately.

[quote user="Clare Tapsfield-Wright"]Surf board [/quote]

Not me.

Always take bike and cycling gear though, and I have been known to throw in boots, iceaxe and crampons when I used to do a regular twice a year Scottish locum.

Seriously, I find it worthwhile getting a 1:50 OS map of an area I've not been before. In addition find out about local restaurants, museums etc.