Out-of-hours GP services in Revenue talks on locums' tax


THE REVENUE Commissioners is negotiating with the State’s out-of-hours GP services in relation to possible tax liabilities arising from their employment of locum doctors.

Revenue confirmed yesterday that it is holding discussions with eight of the Republic’s out-of-hours GP services after it emerged one of the services, Shannondoc in the midwest, has made a €350,000 settlement with Revenue regarding a tax liability concerning the employment of locum doctors. Shannondoc provides an out-of-hours service to 275,000 people in Clare, Limerick and North Tipperary.

The returns for 2009 in a “post balance sheet event” on September 10th, 2010, “Revenue accepted an offer of €350,000 to settle a tax liability due on locums working for Shannondoc Ltd for the years 2008 to 2010”. The accounts confirm €284,294 was due in relation to locums in 2008 and 2009 with €65,736 due in 2010.

Board member with Shannondoc, Dr Michael Harty, said yesterday that the settlement follows Revenue reclassifying locum doctors as employees of services such as Shannondoc rather than free agents. Dr Harty said that the settlement arose from Shannondoc treating locums as free agents and not paying 10.75 per cent in PRSI for locum doctors and deducting PAYE at source. He said the reclassification by Revenue “may create a major problem as the availability of locum doctors may diminish”.

Dr Harty said that all GP practices received a letter from Revenue that practices treat locums as employees from January 2010.

He added the payment of the €350,000 would not affect the day to day operations of Shannondoc. The manager of Shannondoc, Larry Maher, yesterday declined to comment. Shannondoc’s accounts show that it had €753,708 in cash at the end of December last and the company provided for the tax liabilities through accruals totalling €284,294 in 2008 and 2009.

Shannondoc is one of nine GP out-of-hours services operating across the Republic and Revenue yesterday confirmed in relation to the locum issue that it “is currently engaged with each of the out-of-hours service providers with a view to clarifying the position and to ensuring the correct tax treatment is applied to payments made to doctors”.

The spokeswoman said: “I would not be in a position to say when the inquiries will conclude as each case is dealt with on a case by case basis.”

Separate accounts filed by North Doc Medical Services Ltd, which provides out-of-hours GP service in north Dublin city, confirm that negotiations with the Revenue is ongoing in relation to the locum issue.

The recently filed accounts state: “The directors believe that the final outcome of the Revenue Commissioners’ review and any subsequent payments to the Revenue arising out of this review are still uncertain and therefore no provision has been included in the financial statements.”

Chairman of the Irish Medical Organisation GP Committee, Dr Ronan Boland, said the group had highlighted the difficulties that treating locums doctors as employees creates for GPs.

“This will create a significant additional financial and logistical burden on practices which are already stretched by cutbacks. It will also diminish the pool of already scarce locum doctors given the burdens that having numerous PAYE employments place on them. This in turn will make it much harder for GPs to find holiday leave and especially sick leave cover.”