Q: We are three GP partners, but according to our monthly financial statements from the PCT, only two of us are contributing to our NHS pensions via deductions at source. When calculating profits per partner, this should be on the basis that all practice expenses must be deducted from the income before distributing the balance in our profit shares.
The practice as a whole should not have to pay pension contributions for the third partner when, following 24-hour retirement, she is no longer an NHS Pension Scheme member, and she should not have to lose out because of these deductions. The non-contributing partner should receive a sum equivalent to the amount wrongly deducted. How do we resolve this problem?
The employee's and employer's NHS superannuation for the partners should not be treated as a practice expense but rather as their own cost (personal expense) and included in drawings and claimed on each partner's tax return.
If this has not been the case, the retired partner has in fact been unfairly paying some of the cost of the other partners' NHS superannuation. To resolve this issue, your accountant needs to calculate how much the retired partner has been incorrectly charged with the other partners' pension payments and make an adjustment in the accounts.