NHS pension delays could be costly

NHS pension delays could be costly by John Fearn - PFM Dental

Delays in sending out PSS1 forms to dentists are causing headaches and more problems may be on the way. The form shows annual NHS pension figures, which are needed to complete tax returns by 31 January 2014, but many dentists are still overdue this information.

Some dentists had less than a fortnight in December to decide whether to pay an HMRC annual allowance charge through the NHS Pensions Scheme Pays option or by adjustment to their 2011/12 tax return.

One of our clients only received his PSS1 form, confirming he had exceeded the annual pension allowance for the 2011/12 pension year, on the 19th December. With a deadline for action of 31^st December and Christmas and Bank Holidays to contend with, this gave him insufficient time to liaise with his professional advisers and make an informed decision.

With the Scheme Pays deadline missed, NHS Pensions listened to our appeal and has allowed him to apply for the Scheme Pays method of settling the HMRC charge. This prevented the need for the dentist to produce £20,000 at short notice.

Another potentially missed deadline is looming. So far, only a handful of dentists have received their 2012/13 PSS1 annual NHS pension figures form. Technically, these figures are required for the correct input on the tax return, due by 31^st January 2014. Most of these tax returns have already been submitted and the NHS pension figures are now well overdue. Dentists breaching HMRC’s annual allowance in respect of 2012/13 pension year will need to instruct their accountant to make a retrospective adjustment before 31^st January 2015.

If this seems confusing, dentists are advised to ask a suitably qualified dental accountant and financial adviser to examine their individual pension circumstances. The Scheme Pays option is not for everyone so careful analysis is required.

Jon Fearn is a qualified independent financial adviser and NHS Pension specialist for PFM Dental.

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