Many NHS executives have refused to supply trusts with assurances over their tax payments and now face investigation and potential fines, reports The Telegraph.
An initial inquiry has discovered that 86 NHS executives have not given assurances that they pay the correct amount of tax and national insurance. These medical professionals are paid through their own private companies thus cashing in on certain tax benefits.
As a rule, any public sector worker who fails to demonstrate their upstanding position with regard to tax payment must be referred to HMRC. This was instated after a previous investigation by the Treasury discovered that 2,400 public sector workers had successfully avoided paying considerable amounts of tax.
When claiming income through a personal company, individuals can avoid paying up to an extra 25% of their income to the taxman by paying corporation tax as opposed to personal income tax. In addition, payment via a personal company also enables individuals to lower their national insurance payments, discount their expenses before confirming the total profit they have made and even pay themselves in dividends, lowering the tax payment further.
Reporting on the issue, the Telegraph observes: ‘Under the crackdown, any public sector worker earning more than £58,200 and employed for more than six months through a service company must give their employer assurances they are not securing an undue tax advantage.’
The Treasury has demanded the names and details of all 86 executives who have failed to provide the required assurances in order to carry out an investigation. In the event of a discovery that these employees used personal companies purely to reduce their tax payments, the HMRC ‘can reclaim all the income tax and national insurance contributions owed with interest’. Moreover, additional fines of up to 100 per cent could be given in circumstances where there has been an attempt to conceal income.
You may also like:
- In the courts: High Court rules benefit cap discriminates against…
- Media law: Tim Yeo loses Sunday Times libel case
- International: Journalists stand trial in Vatican Holy See scandal
- Telecoms law: Cinema company ‘bewilders’ Church of England by banning…
- Discrimination: Report warns that HIV-AIDS crisis being worsened by Commonwealth…