For GMS and PMS contracts, the partnership model is still favoured and for good reason. Partnerships are flexible allowing people to come and go, changes in profit shares to be applied and are simple to run. NHS contracts under GMS and PMS restrict how companies can be used – for example, you cannot subcontract work to a company owned by one of the contract holders.
For other types of contracts such as APMS or Primary Care Networks in England, companies may have some commercial merit. APMS contracts are time-limited and so there is more contractual risk at the end of the contract. PCN’s have been designed in a way that makes VAT and employment an issue – a limited company may well be the solution to these problems.
It is worth stressing that a limited company does not reduce the risk from medical negligence as the risk remains with the practitioner in all cases.
Care does though need to be taken when considering using a limited company and you need to consider both the commercial and tax implications. Our video’s with Mills and Reeve on incorporation and PCN’s look at the areas to look at. Networks only apply to our English practices, but the incoporation issues cover all countries.
Written by Des Liddy, Healthcare Partner
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