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Bid to tackle doctors shortage could see pension tax break for high earners

People who earn more than £110,000 face higher taxes on pension contributions, leading some NHS consultants to turn down extra shifts.

The Government is reportedly considering pension tax relief for high earners such as consultant doctors (Anthony Devlin/PA)
The Government is reportedly considering pension tax relief for high earners such as consultant doctors (Anthony Devlin/PA)

By Patrick Daly, PA Political Correspondent

High earners could end up being given pension tax breaks as part of efforts to get doctors to take on more shifts, it is being reported.

The Treasury has refused to comment on a Times report that it is preparing to give tax relief worth hundreds of millions of pounds to people earning more than £110,000 a year.

The move would be designed to tackle the issue of doctors turning down additional shifts because taking on extra hours can see them hit with an increased tax bill on their pension contributions.

Pension rule changes introduced by former chancellor George Osborne, which came into effect in 2016, mean that people who earn more than £110,000 face higher taxes on pension contributions.

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George Osborne introduced pension rule changes when he was chancellor (Stefan Rousseau/PA)

This has landed some senior NHS consultants with unexpected tax bills of tens of thousands of pounds, prompting some to opt to work fewer hours, which in turn has caused problems for the health service.

The Times reports that ministers are preparing to give tax relief to tens of thousands of people earning more than £110,000 in an attempt to solve the problem.

The newspaper claims the Treasury plan would involve raising the threshold from £110,000 to £150,000, a move that could reportedly free up 90% of consultants to take on extra shifts and help cut NHS waiting lists.

But the tax break would apply to all high earners, not just those in the health sector.

A Treasury spokesman said: “We do not comment on speculation about tax changes.”

If the Treasury does decide to introduce new measures in a bid to solve the problem, an announcement is expected to be made by Chancellor Sajid Javid in the Budget in March.

PA

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