Time expended

A realistic assessment of how much time is required to perform professional obligations.

The BMA is working on a fee calculator. It will contain a peer reviewed range of times associated with the performance of any medical and administrative work.

In practice this means allowing reasonable and sufficient time for clinical work such as consultations and completing reports to an appropriate professional standard, as well as surrounding work in connection with the request (for example, referral letters and requests for medical tests).

Knowledge and experience

• Qualifications.
• Familiarity with circumstances relevant to the enquiry.
• Organisational responsibilities (for example, compliance with UK GDPR and obtaining consent).

Opportunity cost

Income that you might forego in providing the service.

In practice this could be the cost of a consultant’s time measured as the number of consultations or the value of the work, which would otherwise not be undertaken during that time.

Operational overheads (proportion of)

• Administrative and accounting systems.
• Accountancy and legal advice.
• Applicable office rental and utilities.
• Office equipment and cleaning.
• Medical equipment.
• Stationery expenses.
• Administrative support.

Professional expenses

• Continuing professional development.
• Medical indemnity.
• Applicable appraisal costs.
• GMC, BMA and LMC subscriptions.
• Specialist societies, royal college and other professional organisation subscriptions.

Special expenses

• Any disbursement specific to the request (for example, lab fees).

Travel expenses

Usually this is calculated using standard car mileage rates, however can include train fares (including first class train travel when appropriate).

• Fuel costs.
• Vehicle wear and tear.
• Disbursements (for example, parking and road tolls).
• Attendance at surgery and visiting patients outside the usual geographical area of work.

Adaptability

• Working in unfamiliar environments.
• Availability of colleagues and other medical staff for advice and support.
• High workload patients (eg patients in nursing homes).
• Familiarity with equipment (eg computer systems).
• Work type and intensity of session (eg open access, booked appointments).

Unpaid time

Doctors undertaking self-employed work will not be paid for leave relating to sickness, family reasons, holiday or study, or for any unfilled sessions. These costs must be amortised over an annual rate, based on annual hours available for work. 

Amortisation is the gradual write off of an asset over a period of time.

Ethical and legal considerations

A doctor’s signature is regarded by the GMC as a guarantee of authenticity. A doctor who signs a document incorrectly faces serious, and sometimes permanent, sanction through both the legal system and their professional regulator. 

Prior to charging for, or refusing certain work, consider any ethical implications to patient care. There is however no obligation to be an expert where there is no ongoing duty of care.

Agreeing fees with individuals

Where settlement of the fee is the responsibility of the patient or individual your professional fee should be discussed and agreed with them before undertaking the work. You should make it clear if you are obliged to charge VAT.

Our guidance Why GPs sometimes charge fees - could come in handy when having those discussions.

Doctors must also make sure they comply with their professional responsibilities as outlined in Good medical practice.

Agreeing fees with organisations

1. Agree fees and terms and conditions in writing, before undertaking any work

• The terms could include services to be provided by the doctor, time estimate, terms of payment, cancellation and late payment. When drafting these seek your own independent legal advice.
• You must ensure that when undertaking legal work your fees are not subject to 'taxation'. This is a legal term describing a process which judges whether the cost of an action is reasonable. You should specifically state that you will not wait for a solicitor’s firm to be ‘put in funds’ by their clients.

2. BMA members can speak to one of our advisers

• Before entering into a contract, doctors should ensure they review any proposed terms thoroughly and make notes of any discussions entered into. It's always best to seek independent legal advice.

3. Conduct due diligence checks on any commercial organisation you wish to deal with

• A report from a credit-rating agency may disclose any county court judgments, risk warnings and the financial position of the organisation. You may wish to secure a deposit, or full payment, before work starts. 

Fees and your pension

England, Wales and Northern Ireland

Under the current GMS contract for GPs, fee-based payments for NHS work (net of expenses) are pensionable. That means fees paid directly to a GP provider or practice by an employing authority, are pensionable.

Because of this, where an individual fee is agreed, you must remember to add on the employer’s pension contribution (see current rates).

GPs should pension these either as an individual through form SOLO or, if pooling the income into the practice, through the annual certificate of pensionable profit.

Scotland

GPs should check with the Scottish Public Pensions Agency about the procedures for pensioning such income.

Where hospital doctors carry out work under collaborative arrangements, fees are only pensionable if paid on a sessional basis.

Please remember that in order to achieve a comparable pension to that provided by the NHS pension scheme, the value of pension contributions would need to be carefully considered.

Contact BMA pensions

Types of fee agreements

The BMA’s professional fees committee negotiates some national fee agreements for:

• central government work
• medico-legal work
• insurance work
• a wide range of reports, examinations and certificates for individuals/patients or third party organisations
• cremation certificates
• coroners' work
• forensic physicians.

While we encourage the use of these fees, it is ultimately the decision of the individual doctor whether to adopt them.

 Local and individual agreements

Where there are no nationally agreed fees in place, doctors remain free to charge their own fee although they must be extremely vigilant about the impact of competition laws.

In particular, caution should be exercised not to engage in prohibited activities which can attract Office of Fair Trading investigations eg colluding with other doctors in relation to setting fees.

There is no prohibition on publishing your fees on your website.

VAT medical indemnity and debt recovery

How do you decide whether or not VAT is applicable?

With regard to VAT, any chargeable activity falls into one of four categories:

• liable to VAT at the standard rate
• liable to VAT at a reduced rate
• liable to VAT at zero rate
• outside of the scope of VAT.

You should always check the HMRC website or consult your accountant. But generally, where the principal purpose of the medical service is the protection, maintenance or restoration of the health of an individual then the services will be outside of the scope of VAT.

Primary health care provided through either the NHS or the private sector is outside the scope of VAT. GMS/PMS contractual activity, with the exception of dispensing, is outside the scope of VAT.

However, any service provided by doctors is to enable a third party organisation to decide a course of action the services are subject to VAT.

Doctors whose income (subject to VAT) exceeds the VAT threshold (check current rates) must register with HMRC and ensure they account for VAT on any services undertaken.

Please consult the HMRC website for details.

Financial record keeping

In addition to keeping records for tax purposes, even if you are not VAT registered you are required to make a note for each activity that you have considered whether or not it falls within the scope of VAT.

This is particularly important when your income approaches the VAT registration threshold and a VAT inspector could ask to examine your financial records at any time.

 Medical indemnity

Doctors must ensure that they have medical indemnity for professional fee (non-NHS) work as such work is not covered by NHS indemnity. For further advice please see our guidance on NHS indemnity. You should inform your indemnity provider of all categories of work undertaken.

 Debt recovery

Doctors who have undertaken professional fee work may experience delays in payment or be unable to recover payment.

Where reasonable attempts to recover outstanding monies prove unsuccessful, doctors may wish to consider legal action after getting independent legal advice.

Settlement of such disputes could entail the following:

• Writing a letter to the owing party.
• Setting out your demand for the outstanding payment and your intention to commence court proceedings if the payment is not paid promptly.
• Lodging a small claim in a court of competent jurisdiction. Further guidance: Ministry of Justice.

Lodging a complaint against the instructing solicitor firm to their regulator for outstanding or late payments, in the case of medico-legal work.