A locum GP is someone who temporarily takes the place of another practitioner in case of leave or other shortages. Usually, they are self-employed and sometimes they conduct their work via a locum agency or their own limited company. Locum GPs are also generally paid fees for their work, differing from employees.

Locum work entails various roles and contract lengths, covering anything from ad hoc sessions to long-term maternity coverage. They can also cover a single service or a range of services. The following healthcare providers may employ locum GPs:

• NHS
• Private Practices
• Out-of-Hours Providers

GPs engage in locum work for a variety of reasons. It can be conducted as part of a portfolio career or even to fit around family commitments. Newly qualified GPs can find it helps to assess different types of working environments or geographical locations whilst considering longer-term positions.

Locum work brings increased flexibility and a high degree of autonomy, though patient continuity of care can be more difficult, and you have fewer working entitlements. For example, a locum GP is not entitled to sick pay, maternity/paternity pay or holiday pay, which are only available in a salaried role.

You should also be aware that the rules surrounding ill health and death in service benefits are different as a locum GP compared to salaried roles and it is important to gain specialist financial advice on these differences.

You can begin working as a locum at any time once qualified. You will need to ensure that you are registered with HM Revenue & Customs (HMRC) as a self-employed individual, which can be done either online or Accountant. You will also need to ensure you are included on the GMC’s GP Register as well as the National Performer’s List.

A contract will be required and there should be a clearly defined final agreement in writing, signed and dated by both parties. The contract should include details of your fees, timetables and core responsibilities for you and the engager. It should also include a substitution clause which states that you, as the locum, are responsible for finding a replacement if you are unable to conduct the work.

This must also be a contract for services (rather than a contract of service, which is the case for salaried GPs) and state that you are conducting the work in a self-employed capacity, with tax and National Insurance (NI) to be met by you. It would be beneficial to have a standard contract which can be subject to changes to suit the provider if mutually agreeable.

As a self-employed locum, you will be required to submit an annual Self-Assessment Tax Return (SA100). This will include all your income during the tax year (ending 5th April each year) be it from a salaried role, locum work and any interest, dividends, or rental income. Your total income is used to determine the amount of tax and NI for which you are liable in the year. The liability is paid in two “payments on account”:

• 1st Payment on Account by 31st January (within the Tax Year)
• 2nd Payment on Account by 31st July (after the Tax Year)

You must submit your tax return no later than 31st January after the tax year. Any further liability due will be paid to HMRC by this date, alongside the first payment on account for the next tax year.

You can reduce your locum tax liability by claiming various allowable expenses. All records and receipts for the expenses claimed must be kept for six years after the tax year has ended. Items which can be claimed for the full cost include:

• Professional Subscriptions Paid
• Medical Literature or Equipment Purchased
• Refresher/CPD Courses Attended (including Travel to and from the Course)
• Public Transport Costs Incurred for Business Purposes
• Postage and Stationery
• Management Fees Incurred Relating to Any Agency or Session Booking System.
• You May Also Make A Partial Claim for Certain Costs Which Have a Duality of Purpose, i.e., Costs for Both Business and Personal Usage, such as:
  • Line Rental and Tariff Costs for Home Telephone and Broadband
  • Mobile Phone Contracts
  • The Initial Cost of a Home Computer, Laptop, Tablet, or Phone
  • The Initial Cost of Computer Software, Printer Cartridges, and Repairs
  • Certain Household Costs (When Using One’s Own Residence as a Place of Business)

You may also claim for motor expenses, via a mileage claim or as a proportion of running costs. For either claim a mileage log must be maintained as evidence, detailing business miles and total miles.

It should be noted that travel between home and the practice could be counted as private, not business mileage, depending on the circumstances. Specialist advice will help to ensure that only allowable travel is included in a claim.

A limited company can be used to conduct locum work, although you should be certain that a company is the right structure for you and obtaining specialist advice is essential to ensure all necessary considerations are made. This would limit your potential liability to the amount you had invested.

By contrast, being self-employed has no limit to potential liability. Having a limited company can help lower the tax you would have to pay, depending on the company structure, your household cashflow requirements, and pension contributions.

Companies have a larger administrative burden, such as requirements to complete Corporation Tax Returns as well as your own Self-Assessment Tax Returns each year and Companies House compliance.

In addition, by working through a personal company, the IR35 rules (intermediaries’ legislation) may apply. These exist to ensure that people who would be classed as an employee, if not for their limited company, do not benefit from tax advantages available to self-employed individuals. To determine whether your work could be regarded as employed or self-employed, HMRC has released an Employment Status Indicator.

Since April 2017, however, the responsibility of determining if IR35 rules apply lies with the ‘employer’ (engager). There are significant changes for taxation, NI and pensions depending on the outcome of this test, although it does not affect the employment status, with regard to statutory rights. Taking specialist advice in this matter before accepting an engagement will help ensure that the correct status is applied to each engagement.