GP Retirement Guide
A recent news report has suggested that as many as one third of practising GPs are intending to retire within the next five years. If you are one of them, and whether you are single handed or in partnership, the guide below will help you work your way through to the finishing line!
Retirement as a Partner
With a Partnership Deed
- Be aware that the date of your own retirement might be impacted by the retirement of others in your practice and plan ahead accordingly
- Check the stipulated notice period for voluntary retirement and note whether it must conclude on a specific date (e.g. an accounts date) as this could affect your retirement date by as much as 12 months, depending upon the drafting
- If you are hoping to take “24 Hour” retirement, ensure your Deed permits you to do so – and to return to the practice – as failing this there is no requirement upon your partners to accept you back!
- Be aware, and follow strictly, any provision relating to the service of your Notice, as failing this it could be invalid (and in a worst case scenario allow another partner to “get in first”)
- Check whether you will be bound by any restrictive covenants under the Deed (although if you do not plan to undertake any type of work after retirement, this will be of no concern to you)
- Be aware of the time periods for repayment of your capital and current account balances – and take GP specialist legal and accountancy advice to understand the practical implications relating to your tax and other financial affairs.
Without a Partnership Deed
- It follows that there are no “agreed” rules to be followed
- This means your retirement could present both you and your partner(s) with a potentially challenging position to overcome
- Ideally, if time permits, you should endeavour to put a Partnership Deed in place in preparation for your retirement, which (if well drafted) can continue to govern the ongoing partners post your own retirement
- Failing this, your retirement could trigger the dissolution of the partnership – and the automatic termination of the NHS Provider Contract held by the practice as a whole
- It is essential that GP specialist legal and accountancy advice should be taken at an early stage to endeavour to prevent this outcome.
- Freehold – if you are named as a “registered proprietor” of the property, you should sign a TR1 to remove your name from the title
- Lease – if you are a named tenant on the face of the lease or have subsequently signed a deed of assignment, your name should be removed – and the consent of the landlord may be required to achieve this.
- Depending upon the lease terms, you may also be required to enter into an Authorised Guarantee Agreement – although urgent GP specialist legal advice should be sought before you agree to this
- If the property has a capital value, valuation advice should be sought from a GP specialist surveyor who should value the property in accordance with the terms of any Partnership Deed/Declaration of Trust
- SDLT: your partner(s) should take advice from a GP specialist lawyer on the impact of any SDLT which could prima facie be triggered as a result of the transfer of your share
- Mortgage – if the property is mortgaged, the mortgagee’s consent may be required to secure your release – or alternatively your partner(s) will require time to refinance their shares
- Early Redemption Payment: be aware of any which could be triggered by the rearrangement of the mortgage.
- NHS Pension Agency – advice should be sought at an early stage before any steps are taken to trigger your retirement – and records must be amended at the time of retirement before pension payments can commence
- NHS England – GMS Contract: Notice of Variation dealing with the removal of your name must be submitted at least 28 days’ in advance.
- NHS England – PMS Agreement: as this is a ”personal” agreement, NHS England’s consent to the removal of your name is required on a case by case basis and cannot be automatically assumed
- CQC – notification for the removal of your name from the Partnership registration must be submitted – and may take 6 weeks+ to process
- Partnership Bank – removal of your name from the Account Name, the Bank Mandate and any electronic signatures associated with the Partnership Bank Account(s) must be processed promptly
- “Holding Out” – you should ensure the removal of your name from the practice’s letterhead and other documentation, to include the practice website – and remove your brass plate.
- Patients: they should be informed through announcement at the practice premises or via the practice website
- Suppliers of the practice: should be similarly informed
- HMRC: should be informed by the Practice Accountants who should also be instructed to prepare either Succession Accounts (to the date of your retirement) or Partnership Accounts (to the usual Accounts Date, apportioned pro rata, depending upon the agreement reached between you).
Retirement as a Single Handed GP
This is not as straightforward as retiring from a partnership. You will need a firm succession plan as there are limited options available for a single handed GP who wishes to retire.
- Consider taking on a new partner who can “take over” the practice, thereby allowing you (after a period of time) to “step down”
- This may be difficult in the current climate as it is becoming increasingly difficult to find a GP who is prepared to become a Principal in a small practice and neither is this encouraged by NHS England.
- If a new partner cannot be found, talk to local practices about the possibility of a merger.
Close down of practice
- If neither of the above can be achieved, the last option is closure of the practice
- Notice must be served on NHS England to terminate your GMS Contract/PMS Agreement
- NHS England will either put the Contract out to tender or disperse the patient list
- Be aware this could incur huge costs for a single handed GP relating to:
- the redundancy of staff
- the sale of all assets
- the settling all debts/liabilities
- ongoing liabilities relating to outgoings under any mortgage/lease which will no longer be met as rent reimbursement will cease on closure of the practice.
Retirement, particularly for a single hander, is not as simple as setting the date and walking away. As an owner of the business there are many liabilities which could follow you into retirement, both clinical and commercial – and it is essential to follow the appropriate path to ensure these are correctly handled and “put to bed”.
GP Specialist advice from an accountant, a surveyor and a lawyer will be essential to ensure you are placed in the best position – allowing you to look forward to your retirement without concern!