With doctors pay falling by up to 30% in real terms over the last decade*, an often overlooked way to increase your take home pay is by working tax efficiently. Ed, Medics’ Moneys Chartered Accountant and Chartered Tax advisor is revising for his GP membership exams so I’m in charge of the blog this month. So here’s 5 free ways to boost your income without doing anymore work, but by being financially smart.
1. Claim a tax rebate – Estimated saving minimum £2,262
Claiming a doctors’ tax rebate can reduce the costs doctors have to pay on tax deductible expenses such as exams, GMC fees, Royal College fees etc by up to 40%. For example a GP trainee would expect to incur Professional Fees of around £5,656 in the 5 years from FY1 to their final year which could save them £2,262 in tax – and that assumes they pass all their exams first time. The longer the training, and the higher the total exam costs the more tax relief you will be eligible for.
We have produced free step by step guides to claiming tax relief for doctors which you can download here.
2. Check your tax code – Estimated value £varies
A big problem for doctors is tax code errors. As we switch jobs in, say, August we will usually receive a payslip from our old employer and our new employer, confusing HMRC into thinking that we are working 2 jobs and applying the wrong tax code. Luckily we’ve made a free step by step guide to sorting out your tax code. Here’s our guide to checking your tax code is correct.
3. Claim travel and relocation expenses – Value up to £10,000 over course of training
You may be able to claim up to £10,000 tax free relocation expenses during training. This can include paying your stamp duty, removal fees, legal fees and can include travelling expenses between hospitals. Further information can be found here
If you are a GP trainee on GP placement you can also claim mileage to and from work in certain circumstances. This page explains more.
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4. Got children? Get tax free childcare and claim child benefit –
See your options here. You can claim child benefit for each child you’re responsible for. If your income exceeds £50,000 per year you’ll receive a reduced amount and need to complete Self assessment and if your income exceeds £60,000 you will need to tell HMRC immediately. Somewhat bizarrely, if one parent earns £61,000 per year and the other earns nothing (total household income £61,000) you can’t claim but if both parents earn £49,999 or less (total household income £99,998) you can claim the full amount. The whole claiming process can be completed online. Details how to claim here.
5. Tax free childcare – £2,000 per child per annum.
You can get Tax-Free Childcare at the same time as 30 hours free childcare if you’re eligible for both. Be aware if your income goes over £100,000 p.a. you will no longer be able to claim.
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