Ndubuisi Egwim breaks down UK IR35 rules for doctors using a plumber analogy. HMRC checks three things: can you send a substitute, do you control how work gets done, and is there ongoing obligation. Locum shifts and expert witness work may fail these tests differently.
As a doctor, you've probably heard that using a limited company can save tax. But are you even allowed to use one? Believe it or not, your local plumber probably understands the answer better than most doctors because there's a test that decides whether you're genuinely self-employed and eligible to use a limited company. It's called IR35. HMRC is not interested in your job title. They look at actually how you work. And 3 things matter most: substitution, control, and mutual obligation. Let's use my plumber, for example. I have zero DIY skills. So I, I call for every little thing. If he couldn't come, he could send someone else from his company. That's substitution. I don't tell him how to fix the boiler. He decides how to do the work. That's control. Once the job is finished and paid for, neither of us owe the other anything. He doesn't have to come back next week. I don't have to hire him again. That's mutuality of obligation. And if unfortunately he's ill and can't work, he doesn't get paid. Now, Think about your own work, your locum shifts, your private practice, your medical advisory work, your expert witness job. Which of those 3 tests do you think your work really passes? So tell me in the comments. And if you'd like to learn more about tax efficiency for doctors, follow Moneywise Doctor for more.
