Doctors in partnership

Emthi

I have taken on a new client who is a doctor. He has two partnerships, partnership A and B. The profit share from A was £137,000.

Partnership B, in which his wife is a partner, she is also a doctor. The profit of B was £30,000 and currently they have the profit share like 60% for him and 40% for her.I advised them to incorporate B and pay him as little as they can and pay her salary (less than 5720) and a dividend. Am I correct in this matter? Please correct me if I’m wrong.

And also are there any special NI rules for Doctors?

burg

There are some degree of specialities surrounding Doctors and in particular superannuation (pensions). Incorporating may have some affect on this.

Someone with this speciality will no doubt be along shortly and can advise more accurately.

farmergiles

Emthi wrote: »

I have taken on a new client who is a doctor. He has two partnerships, partnership A and B. The profit share from A was £137,000.

Partnership B, in which his wife is a partner, she is also a doctor. The profit of B was £30,000 and currently they have the profit share like 60% for him and 40% for her.I advised them to incorporate B and pay him as little as they can and pay her salary (less than 5720) and a dividend. Am I correct in this matter? Please correct me if I’m wrong.

And also are there any special NI rules for Doctors?

I wouldn't advise incorporating a Doctors practise. Their Superann is so good as a partnership. They contribute up to 7.6% of income and the nhs contributes the rest, up to a combined total of 20%. If they incorporate, they lose this! Plus, as a limited company, they would have to re-negotiate their contract with the PCT and they would lose out again because the PCT would try to reduce the contract prices.
I did work in a practice that specialized in dentists and doctors accounts and I asked the same question when I first started there.
It just isn't worth it!

Emthi

Partnership

Thank you very much