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Tax officials have harvested £9m in unpaid tax from 1,500 medical professionals, although 30,000 were approached in a disclosure campaign.

Letters were sent to doctors and dentists asking them to come forward with any admissions of unpaid tax from previous earnings.

A deadline was set for the end of June before HM Revenue and Customs (HMRC) started their investigations.
HMRC said it was happy with the results and urged others to come clean.

“We did not have a target in mind, but nonetheless, the campaign has resulted in millions of pounds of tax that might otherwise have been lost being paid to HMRC as required by law,” a spokeswoman said.
“Anyone who has been evading tax should talk to us as a matter of urgency, as voluntary disclosure always makes financial sense.”

Deadline

Medical professionals who admitted unpaid tax before 30 June could pay past tax, plus interest, and a penalty of 10% of the unpaid tax.

For those found out after the deadline, the fine would increase to between 20% and 100% of the unpaid tax.
However, accountants have said they considered the response to be muted, with many medical professionals now facing investigation and, in the most serious cases, prosecution.

“HMRC is making it clear that it holds information, particularly in relation to doctors and dentists, that still has not been disclosed,” said Stephen Camm, tax partner at PricewaterhouseCoopers.

“From the disclosures that have been made, HMRC have uncovered individuals who should have come forward but who have failed to do so.

“Investigations will start in the autumn in earnest. HMRC is already working on cases for prosecution and expect numbers to rise. There is no doubt that any medical practitioner that has something to disclose to HMRC must deal with this issue now.”

The medical professionals are the latest group to be targeted by the Revenue.

Chas Roy-Chowdhury, head of taxation at the Association of Chartered Certified Accountants, said: “This whole process is very much about HMRC focusing on collecting taxes, from plumbers to gas fitters to doctors.
“The message is that the tax authority has become more authoritative and will continue to be so.”

- Courtesy of BBC News

Figures released by the NHS Information Centre show that administration workforces in the NHS grew 8 times faster over the past 6 months than the number of doctors.

Compared with 103722 doctors working in hospitals, there are now over 237000 managers and administrative staff. From October 2009 to April, the total number of bureaucrats rose by 1800, a growth of just less than 1% in the total workforce. During the same period doctor numbers rose by only 100 – a 0.1% increase.

These figures come at a time when there are concerns that the NHS budget is being squeezed by the growing cost of bureaucrats. A case in point is the recent recognition that hospital chief executive pay had increased by 7% over 12 months, more than twice the increases awarded to nurses. Of greater concern is that the NHS Information Centre data also show that doctor numbers have begun to fall.

In April alone, the number of nursing posts fell by 857, whilst the number of doctors decreased by 261 in the same period, with training and junior registrar posts most affected.

Similarly the number of health visitors has fallen, now with just over 10000 employed by the NHS, compared with 45000 managers.

UNISON union officials have expressed great concern that the loss of frontline positions will have a devastating impact upon patient care.

“Governments use student debt surveys to decide new policies like top-up fees. The policies are often applied to all students regardless of the discipline. They ignore the fact that medical students spend around two years longer studying. This is why medical students need their own finance survey” says the British Medical Association (BMA).

BMA debt modeling predicts that if the cap on fees was to be raised to £7000, those medical students studying outside London would run up almost £57,000 worth of Student Loans Company debt, peaking at over £73,000 eight years after they graduate. After 25 years, over £13,000 would still have to be written off. This scenario would be disastrous for medical students and would not bring expected savings for any Government.

Under a system where tuition fees could be as high as £15,000 a year, levels of graduate debt are likely to reach crippling levels at around £90,000 and take over 31 years to pay off.

In addition, the Government uses a higher measure of inflation (The Retail Price Index) to calculate interest on student loans than it does to calculate public service workers pay (the Consumer Price Index). This will adversely affect all students, as their salary will not keep pace with increases in their student loans leading to increased debt and money worries for medical Doctors.

Recommendation 4 from the 2009-10 BMA Review of Higher Education Funding says “ Students studying medicine should have their total fees capped at the same level as students on three year undergraduate programme. This should ensure that they are not further disadvantaged on top of the loss of income already suffered by studying for additional years.”

Furthermore, there is no alternative route into the medical profession without studying medicine at medical university.

Although certainly not the only factor, concern about debt has a major adverse impact on decisions about applying to higher education. A recent study, commissioned by the Sutton Trust17, found that almost two thirds of students deciding not to pursue Higher Education cited avoiding debt and money worries as a major factor in their decision.

In fact a recent article in the Telegraph reports that Medical students are having to borrow almost £16,000 from their parents to get through their degrees, in what doctors’ leaders have dubbed a “hidden tax” on families.

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Medical students are finishing their five-year courses with crippling levels of debt, the doctors’ union says.

A British Medical Association poll of more than 2,000 students found those now starting their studies face debts at graduation of nearly £40,000.
Doctors warned a career in medicine was in danger of becoming a viable option only for the wealthy.

But the government said support was available for students from the poorest backgrounds.
The survey of students in England and Northern Ireland, where tuition fees apply, found those who started before the introduction of the charges in 2006 were graduating with debts of £19,000.

But it revealed the intake since then were likely to face paying back £37,000 on average.
Tim Crocker-Buque, chairman of the BMA’s medical students committee, said: “Medical education is becoming increasingly expensive, edging ever close to the total exclusion of those without the access to the cash with which to fund themselves.

“Medical education should be about your potential to become a great doctor , not you ability to pay.”
He also warned the government not to raise the £3,225 yearly cap on tuition fees, saying it could have a “crushing” effect on students.

Fees review
A review into the fees will be carried out later this year with some predicting universities will be allowed to set their own charges potentially leading to prices of up to £20,000 a year.

Mr Crocker-Buque said: “The fees being talked about will place a devastating financial dilemma in front of families of all social backgrounds.”
As well as calling for the cap on fees to be retained, the BMA said the government should also help charities to support young people from low income families to pursue medical careers.

Just one in 10 students are from the lowest social groups and the union believes this could drop further in the future.
Louise McMenemy, who is studying at King’s College London, said being a medical student in the 21st century was a daunting experience.
Despite the prospect of a well paid job, Ms McMenemy said: “I am nearly £40,000 in debt and that is likely to rise to £50,000 by the time I graduate.
“That will take me 20 years to pay off. I really don’t like to think about it.”

The 23-year-old from Southampton, who comes from a single parent family, said: “The problem when you are studying medicine is that you do not get a chance to work like other students.

“Certainly in the later years, getting a part-time job is almost impossible as you spend so much time in hospital and you don’t get much holiday.
“I worked in the evenings and weekends in my first two years, but not since.”

But the government said the system was fair as it had been structured to help those who were least able to pay.
The government said families earning less than £25,000 a year were eligible for a grant to cover the cost of the fees which tapered to nothing for families on incomes of £50,000.
A spokesman for the Department of Business, Innovation and Skills said: “This government is determined that finance is not a barrier to accessing higher education.
“More people than ever are applying to university in England and we are committed to ensuring that those who want to succeed are supported by a generous package of loans and bursaries.”

Source : BBC News