Changes in Employment Status Guidance for Locum Pharmacists

HMRC recently announced its decision to remove sector-specific employment status guidance for locum pharmacists, effective 30 June 2023. This change marks a shift in how the employment status of individual locums will be determined and is part of a wider trend by HMRC to remove industry-specific guidance. This article will explore the details of this development, its implications for locum pharmacists, the rationale behind HMRC’s decision and the potential impact on the pharmacy sector.

Previous guidance and self-employment status

Under the previous guidance, HMRC stated that locum pharmacists engaged on a sessional or daily basis, performing only the statutory requirements of their role, were likely to be considered self-employed for tax purposes. This sector-specific guidance helped determine employment status within the pharmacy industry.

Shift to general employment status guidance

From 30 June 2023, HMRC will replace the sector-specific guidance for locum pharmacists with its general guidance on employment status. The employment status of individual locums will be assessed using HMRC’s online Check Employment Status for Tax (CEST) tool. This responsibility will be with the end user/payer of the locum pharmacist. This change aims to align the pharmacy sector’s guidance with HMRC’s general principles for employment status determination. HMRC aims to avoid potential conflicts and confusion that may arise when sector-specific guidance deviates from the broader employment status guidelines.

Harmonisation with associate dentists’ employment status guidance

The removal of sector-specific employment status guidance for locum pharmacists is part of HMRC’s wider program to remove industry-specific guidance. Similar changes were recently implemented for associate dentists, who now follow the general employment status guidelines. PSTAX Director, Angela Ferguson, recently wrote an article detailing these changes and the potential impact, available here. The coordination of guidance across different sectors aims to streamline how employment status is determined by HMRC and ensure consistency.

Considerations and impact of the change

As with the associate dentists, the impact of these adaptations will need to be assessed on a case-by-case basis. Given the relatively short notice provided by HMRC, each end user of locum pharmacists must evaluate their circumstances to determine the implications of the new guidance.

It is crucial for end users in the pharmacy sector to familiarise themselves with these changes and consider the potential impact on their tax obligations.

Seeking support to manage the changes

As the implementation date of 30 June 2023 approaches, seeking professional advice and reviewing individual contracts and working arrangements will be essential for end users of locum pharmacists to navigate this shift successfully. PSTAX can help you navigate the change to employment status guidance by assessing their employment status and ensuring they are correctly classified and you as an end user are protected from HMRC’s significant penalties. Contact us today at 0345 6861321 or via heidi.browne@pstax.co.uk to discuss your situation.

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Angela Ferguson

Written by Angela Ferguson

Angela has spent close to 30 years within taxation, having trained within the big 4 for most of her career. She spent 10 years at EY as a Director in their Manchester office managing the Employment Tax and NMW teams. Prior to joining PSTAX Angela was the Head of Employment Taxes at Saffery Champness for 3 years, growing and developing the team and service line for the firm.

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