‘Time-bomb’ as NHS’S locum workers are lured into Bbc-style tax avoidance schemes

DOCTORS and nurses working for the NHS are entering into dubious tax avoidance schemes as a result of changes to public sector self-employment rules.

Employment experts have warned that the NHS is a “ticking time-bomb” and that locum staff – medical professionals not employed directly by the NHS – are putting themselves at risk.

The warning comes after BBC presenters were left with huge tax bills after the BBC paid them through personal service companies.

Dave Chaplin, the CEO of advice website Contractor Calculator, said the NHS could face a similar controversy after changes to tax rules last year led to lower take-home pay for thousands of NHS staff on irregular contracts.

Telegraph Money has learnt that, in a bid to lessen the blow, some are being lured into questionable arrangements involving loans from offshore trusts. The controversial schemes are almost certain to be ruled illegal when challenged by the taxman. This could leave workers facing life-changing tax bills.

Legislation (known as IR35), to crack down on “disguised remuneration”, or employees being paid via companies to avoid tax, was tweaked to make the employer rather than the contractor responsible for determining eligibility. So far, this only affects the public sector. Contractors say many Government organisations are acting cautiously and issuing “blanket rulings” on the IR35 status of off-payroll staff.

NHS Improvement, the watchdog, was initially accused of ordering trusts to categorise all agency, locum and bank staff as falling within the scope of IR35, meaning they would be taxed at source. After legal challenges, further clarification was given, but locums say many trusts are still issuing “blanket rulings” in contravention of the rules.

NHS Improvement said it advised trusts to follow HMRC guidance.