‘Talk more with your accountant’

London consultants association meeting

By Robin Stride

Consultants have been advised to ensure they have an interactive relationship with their accountant and not just leave things to chance.

Vanessa Sanders 4 web

Vanessa Sanders

Specialist medical accountant Vanessa Sanders told members of the London Consultants Assoc­iation that some specialists just used advisers to fill in and send off their tax return.

But they needed to keep their advisers up to date and have conversations with them.

Mrs Sanders, of Stanbridge Associates, said doctors should ensure their accountant was earning the ‘tax-deductible’ fee paid to them. Problems doctors never knew they even had could then be solved.

She also gave some useful ‘avoid the taxman’ tips at the meeting, held shortly after a court case where a consultant was fined £200,000 and given a suspended two-year jail sentence after admitting stealing £409,611 by failing to declare any taxable income from private practice.

Her tips included:

  1. Submit all tax returns online and in time;
  2. Keep records for four years;
  3. Use diaries as underlying records;
  4. Use a logical invoicing system;
  5. Define debtors at year-end;
  6. Have a policy for bad debt recovery;
  7. Keep all receipts and invoices for expenses;
  8. Match up pay-in slips, insurer notices and invoice numbers;
  9. Keep a car mileage log;
  10. Have a business bank account.

HMRC fines of up to 100% of the tax loss, plus penalties and naming and shaming lay in wait for doctors falling foul of the rules, she warned.

Late filing would mean a £100 fine plus £10 a day until filed. For late payment of tax, 5% of the outstanding balance was due every six months, with interest being charged at 4%. Company fines were even more stringent and could include prosecution.