GP partners

Because drawings are cash and tax follows profit, and in general practice those two diverge further than in most partnerships. Contract income arrives on its own schedule, superannuation is deducted before you see it, and the profit share that determines your tax is not agreed until the accounts are done. If nobody is reserving as profit arises, the gap between what you took and what you owe is discovered rather than managed — which is the single most common source of financial stress among GP partners, and it is entirely avoidable arithmetic.

It depends on pension growth rather than on contributions, which is what makes it hard to see coming. The allowance is £60,000 for 2026/27 with a threshold income of £200,000 before tapering. Because pensionable pay is not finally certified until as much as two years after the year it relates to, a charge can land against a period you had long treated as closed. Reserving for it as profit arises is the only approach that does not rely on a forecast nobody can make accurately.

It is worth modelling rather than assuming, in either direction. GMS incorporation is legally possible within a narrow share-ownership constraint, and — contrary to what most partners expect — the NHS pension survives it, because NHSBSA publishes a Limited Company Annual Certificate of Pensionable Income for exactly that case. Whether it is worth doing usually turns on how much profit is being retained rather than drawn. For most partnerships the honest answer is that it is not worth the complexity.

Enough that January is uneventful, which for most partners means a substantially larger share of profit than feels comfortable at the time. The exact percentage depends on the profit level and each partner's other income, so it is modelled per partner rather than applied as a house rule. What matters more than the precise figure is that it is set aside as profit arises rather than found afterwards, because a reserve calculated in December is not a reserve, it is a discovery.