The Truth About NHS Locum Doctor Pension with Limited Company

If you're a locum doctor working through a limited company and you don't have an NHS pension, or you might even be a salary GP or even a consultant working in the hospital, and you have an NHS pension, but you're not maximizing your pension, you're not taking full advantage of the tax benefits that your pension allowance gives you, then this video is for you. Right? So just in case you're visiting for the first time, I'm Dr. Andy Egwim. I'm the founder of moneywisedoctor.com which is a platform that provides helpful, useful, practical financial information for doctors and healthcare professionals to help them to avoid making costly financial mistakes and to make sure that they are building a secure financial future. So if you look at our other videos and look at our blog post, we delve into topics like investing, we talk about things like life insurance, side hustles, you name it, basically. But today I want to address a topic that I've been trying to delve into for the past one year, but have been very busy addressing all the popular requests, and that is about pension. Because this week I received a letter that spurred me to really delve into it, and that was from NHS Pension.

All right, just a quick one. Something really fascinating has come to my notice and I wanted to share it with you. I've come to see from our YouTube analytics, from our numbers from the back end, that 75% of you who watch this channel and listen to Moneywise doctor are yet to hit that precious subscribe button. Well, thank you to the 25% who have subscribed, but I just want to speak briefly to the 75% who haven't. This channel has been a journey of financial empowerment for medics, healthcare professionals, and your support means everything to us. We are glad that you're on this journey with us, but it would mean the world to me if you hit the subscribe button. So I'm here to ask a small favor. Subscribing to Moneywise doctor helps us immensely. It helps us to scale up, it helps us to be able to bring in expert gets and helps us to enhance the quality of our production. And overall, this will make this a bigger and a better channel for you, providing you financial education that would help you build a stronger financial future as a medic and help you to avoid making costly financial mistakes. So if you've watched our channel before or read the blog, or if you found value in our episodes, if you like what you're watching right now, please could you hit the subscribe button. Go ahead and smash the subscribe button. It's a simple click for you, but it makes a huge difference for us. Thank you so much for considering this and in return, I promise to ensure that everything we do here at money wise Dr. Not only continues, but also improves. We are committed to making each episode better, more informative, more engaging and more empowering. So, do we have a deal? Hit that subscribe button and join our community of financial savvy healthcare professionals. Together we can make the journey to financial freedom more accessible and more empowering. Okay, enough of the groveling now. Enough of the groveling. Thank you for watching and remember, every click supports us in bringing more value and content to you. Let's get back to the video. Thank you.

Now, if you've left your salary job like me and you don't hold a regular job and you're not a self employed GP or doctor in the nhs, chances are that you're no longer contributing to the NHS because you're no longer eligible. But guess what? You still want a pension. You still want to be able to plan for your future. And if you go out there and look, there's a lot of information about NHS pension, there's a lot of people doing YouTube channels about NHS pension, there's a lot of, you know, write ups there. But there's very little information or helpful, practical, realistic information for doctors like you and me who are not working in salary doctors or self employed locums in nhs. So what are you going to do about it? Are you going to fold your arms and thus work out? Well, I'm going to figure out what to do in the future. Or do you go about trying to form your own pension? So this is what I'm delving into right now. I've been speaking to a lot of top pension experts around the country. I've also been doing a lot of research. Research in addition to what I've already thought about. My thinking is that if there are enough doctors who are falling into this category, then we'll probably arrange another Q and A session, probably get some roundtable or get some pension experts. We can ask them all the questions in that area. I did a post about this recently on the Facebook group where there were quite a few doctors and I already have about 100 people on these two platforms who have indicated that they're eagerly interested. So if you like to get information about how to build your own pension as a locum doctor, especially if you work with a limited company, leave a comment for me in the YouTube to say I'm interested. And if, who knows, if you gather enough attention, if you have enough people who are interested in it, then I'm quite interested to do all the work for free because I enjoy doing a deep dive into things like that. Don't worry. I understand as a doctor healthcare professional, you probably don't have the time or the interest to delve into boring financial details. But that's what we enjoy doing@moneywisedoctor.com we'll do it for you and present it in a very digestible way. But we need to know for sure that you're interested in it so that we don't waste time going down that rabbit hole. So if you leave us a comment in the YouTube channel or if you have a friend or colleague who you think might be interested, ask them to check this video and then we'll definitely go from there. So there's quite a lot of useful information about pension that if you don't know about this, you're probably losing money and leaving money on the table. Particularly if you work as a limited liability company. If you're working through a limited liability company, if you're a doctor, nurse or healthcare professional, this means that you're obviously outside IR35. This is a different discussion altogether. But if you're working through a limited liability company, your pension could actually be your secret weapon for optimizing your taxes while still investing for the future. And I'll give you an example. For instance, I was speaking to a group of GP partners, about 20 of them. So we had a meeting, we're sort of on a call and sort of like a Q and A where they asked questions and we talked about it and I found out that a couple of GP partners didn't realize and some of them were new, that there was something called the annual tax allowance which allowed you to contribute up to a maximum of £60,000 to your pension. And this was tax deductible. That means that before you paid any tax that the government allowed you to contribute to your pension. So this is a sort of tax relief. So imagine if you were a locum doctor, you're working through a limited liability company. The usual thing is that your taxed on your profit which is after your expenses. So now your pension you are permitted to put up to 60,000 pounds. I know it used to be 40000 pounds a few years ago, but it's been increased to 60000 pounds. Can actually put up to that amount tax free into your pension and that will be growing towards your future for your retirement without being taxed at all. In case you don't understand the implication of that, that is a big game changer because if you can put 60,00 higher tax rate payer, you're paying 40% or additional tax rate payer paying even much higher, 45%. That means that you're getting a massive tax relief that can actually go into funding your retirement. So it pays to really understand the relationship between your pension and your taxes. For instance, we hear about different terms and you might have heard about SARS and sip and you're wondering what is SARS and what is sip? There's a small self admin start scheme and there's also C, which is basically your self invested personal pension. These are terms that you need to get acquainted with. These are terms that you need to understand, particularly if you do not have an NHS pension. And now let's say a doctor, let's say a consultant or you are a jp, even a JP partner and you have an NHS pension, what's the point of actually going to look into your pension scheme? Would everything be taken care of? Do you have to bother about it? You have to take charge of your finances. If you remember rule one, the money wise Dr. Rules, rule one is take charge of your finances. You are your own personal, you're your own chief financial officer. You don't rely on anyone, you need to check out things for yourself. And of course you might hire financial advisors, you might hire accountants, you might even speak to experts, but you're still the one in charge. So let's say for instance your GP partner or you are consultant in hospital, how does this benefit you? I'll tell you. So every year you're allowed to contribute up to 60,000 pounds maximum into your pension. Now if you get your pension statement from your pension administrator and you find out that in the past three years you've not contributed up to that maximum, you can contribute to your pension up to the yearly maximum and count three years backwards. And that's all tax deductible. So really pays to understand these things. And that is why we're going to be delving into pension, especially for those who are not on the NHS pension and also for those on the NHS pension that want to make sure that they are optimizing it and maximizing it to get the best out of it, to make sure that they are not letting their annual allowance go to waste. Now if you're interested in going on this journey with me, if you want to join me and watch as I go down that rabbit hole. Or if you like for me to be able to get together a Q A session, you can ask a lot of questions on pension getting a pension expert. Comment on the YouTube below and invite any doctor healthcare professional you think might benefit to also watch this video and comment on the YouTube below. And of course, if you want to watch our other content on other things like investing, life insurance and mortgage and all of that good stuff, head over to moneywisedoctor.com or look at the playlist on the YouTube channel. Right. Okay, speak to you later then. Bye bye.