MHA | Common problems with salaried GP payslips

Common problems with salaried GP payslips

Posted on: September 5th 2022 · read

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very employee wants to ensure that they are receiving the correct remuneration and paying over the correct deductions for the job that they do.

In the course of our work for GP practices and salaried GPs, we see salaried GP payslips on a regular basis and have identified various problems that arise on their production. 

Below highlights some of the common problems that we see.


Example: Salaried GP works 6 sessions within the practice but completes an additional session to cover sick leave.  Pay for this additional session is identified as ‘locum’ on the payslip however no employee pension contributions were paid over on this.

In the example above, the additional income should have been pensioned as overtime. 

All salary, fees, wages and other regular payments, including overtime, are pensionable for salaried GPs.  Bonuses and reimbursements of employment expenses are not pensionable.

Changes in pensionable pay

Example: A salaried GP receives a pay increase in June however the employee pension contribution deducted from the monthly pay remains the same for the whole pension year.

Employee pension contributions should be calculated on a monthly basis based on the total pensionable pay for that month.

The applicable tier rate for the expected total pensionable pay for the year should be used.

It cannot be assumed that employee contributions will remain the same for the entire pension year.

Year-end adjustments arising from Type 2 certificates

Example: A salaried GP has completed a Type 2 Self-Assessment certificate for a prior year, and this has identified that there was a shortfall of employee contributions of £200. 

An additional employee pension contribution of £200 has been made in the current month to correct the position.  This has been included with the normal monthly employee contribution and therefore has been added in within the total employee pension contributions for the year.

When completing the Type 2 certificate, salaried GPs must only include the employee contributions applicable for that pension year and therefore it is important that prior year adjustments are not included within the employee’s current year totals. 

Shortfalls and refunds for prior years should be identified separately on the payslips so that salaried GPs can include the correct contributions on their Type 2 certificates. 

Added years contributions missed

Example: A salaried GP has an added years contract which they assume has been deducted each month as the payslip identifies pension contributions as ‘NHS pension (& added years)’. 

They have not carried out any checks on the tier rates applied when receiving the payslip from their employer and, after a number of years, it is found that no added years contributions have been made. 

The salaried GP would be required to pay over the missed added years contributions to correct the position, potentially causing issues with cash flow.

It is essential to confirm with new employees if they hold an added years or additional pension contract and any confirmation should be kept on the personnel files. 

If possible, added years’ contributions should be identified separately on the payslip so that it is clear that the deductions are being made.  The salaried GP can then check the correct percentages have been applied. 

It is also essential to keep the contributions separate as the totals will be needed when preparing the Type 2 certificate at the end of the pension year.  The Type 2 certificate does not include a reconciliation of the added years’ contributions.

Still, it is important that this is done in conjunction with the certificate to ensure the correct amounts have been paid over.

National insurance calculated after deduction of pension contributions and not before

Example: A salaried GP provides their payslips for a whole pension year, on review it is identified that there are inconsistencies with the way that pension contributions are treated when calculating the monthly national insurance contributions. 

In one month, national insurance is calculated on the pay after the deduction of employee pension contributions and then in the next month national insurance is calculated on the pay before the deduction of the employee pension contributions.

National insurance is payable on the GP’s gross earnings so it should be calculated before any pension contributions are deducted. It is important that practices have controls in place to ensure that this is done correctly each month.

More than one practitioner employment

Example:  A new salaried GP starts with the practice on 1 April with a gross salary of £30,000 per year which would attract an employee pension contribution rate of 9.3% (should this be their only employment). 

They fail to mention that they also work in another practitioner role that attracts a gross salary of £35,000.  The practice deducts employee contributions of 9.3% from the £30,000 salary.

The employee rate applicable in the above example would actually be 12.5% as both employments would need to be considered for the total pensionable pay for the year.

The Type 2 certificate would correct this position; however, it does delay payment of the pension contributions and therefore the tax relief available. 

Any adjustments arising from the completion of the Type 2 will be made by PCSE via the practice contract and therefore the salaried GP will need to repay their shortfall to the practice.

If issues like this are discovered in the pension year in question, adjustments can be made in year.

How can MHA help with salaried payslips?

Should you have concerns about how GP salaries are being treated in your practice, or if you are a salaried GP that has identified any of these problems, please contact one of our specialist healthcare team who would be happy to help.

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