The NHS have taken action to avoid winter treatment delays by deciding to cover all senior doctors tax bills. Senior doctors and consultants are refusing to work overtime as they are worried it could prompt a large pension tax charge.
The reason for this is because if NHS staff earn more than £110,000 per annum, they could pay tax rates of more than 90% of their pay which includes their pension contribution. This is why many are refusing extra work because if they earn a penny over the tax threshold, they could be faced with a tax bill worth thousands of pounds.
Therefore, senior NHS staff have been cutting back on their hours which is leading to understaffed hospitals. This is the reason why the NHS has agreed to cover all doctors tax bills to avoid a staffing crisis. How in practice this will be achieved is expected to be complex.
These changes were made in 2016, the main reason why this was brought in was to limit tax relief higher earners can claim on their pension savings. This means that some senior NHS staff have received tax rates of more than 100%, which is leading to staff refusing shifts as they could ending earning less money. But because of the increased demand the NHS cannot to afford to have staff refusing overtime over the winter months which is the busiest time of the year.
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