This guide addresses common questions asked by locum GPs including how to pension locum earnings, opting out of the NHS scheme and how benefits are calculated.
Remember that this is general guidance and for specific information, you should contact BMA pensions.
Eligibility to join the NHS pension scheme as a locum GP
You are able to contribute into the NHS pension scheme for any GP locum work if:
- you are on the medical performers list
- you undertake the locum work directly for an NHS GMS, PMS, APMS practice or appraisal work for NHSE or a health board (the appraisal and locum work does not need to be concurrent).
A locum is defined as someone who:
- deputises or assists temporarily in the provision of essential services
- additional services
- enhanced services
- dispensing services
- OOH services
- commissioned services
- certification services
- collaborative services
- or any combination thereof.
England and Wales
Locum GPs in England and Wales are able to decide whether to pension locum work whilst still contributing to the NHS pension scheme for other GP and officer work.
Locum GP work is treated independently of other GP work and the decision to pension is effected by the completion of locum forms A and B.
Scotland and Northern Ireland
In Scotland and Northern Ireland, locum GP work must be pensioned if other GP work is being pensioned. However, it has been proposed that from 1 October 2023 GPs in Scotland should be able to opt out of individual employments while remaining in the scheme in relation to other GP employments.
This has yet to be implemented.
England and Wales
You can choose whether to be classed as a locum or salaried GP for pension purposes when working long term in one practice. Generally long term is classed as for six months. If you work for more than six months at one practice you can ask to be pensioned as a salaried GP for the period after six months has passed. This does not alter your status as self employed but will mean that you are required to complete a Type 2 End of Year form for the time you are pensioned this way.
The practice will need to amend their estimate form if you begin to pension as a salaried GP after six months work at the practice. You will benefit from life cover throughout the period of engagement, contributing based on 100% of your earnings and a reduced impact of annualising on your contribution tier.
Scotland and Northern Ireland
If you have worked as a locum at a practice for more than six months, you may be able to choose to be pensioned as a salaried GP for pension purposes. This will not alter your status as self-employed.
‘Temporarily’ working is defined as six months, regardless of the hours you work. Working for longer in the same practice is treated as assistant practitioner work and collecting of contributions lies with the practice.
In Scotland, practices could make a case to the health board for a longer period if they face a difficulty in recruiting an assistant practitioner for the longer term.
You can also take a break of one month to ‘reset the clock’.
Yes you will benefit in the following ways:
- A benefit of pensioning as per the salaried GP method (for long term locums working in one practice) is that 100% of income is pensionable (as opposed to 90%).
- You are considered to be in the scheme for the duration that you are treated as such (and not just on days worked) for the purposes of death benefits and ill health retirement applications.
- This also means that the impact of annualising is reduced as you are considered to be in the scheme each day you are treated as a salaried GP and not just on days worked. Annualisation is applicable in the 2015 Career Average Revalued Earnings (CARE) scheme and determines your contribution tier based on income that could have been earned had you worked 365 days. Where annualising applies, the tier arrived at based on annualised earnings is applied against actual income earned in the scheme year.
Paying your contributions
Read more about your pension tier, annualisation and submitting the right forms to PCSE (for GPs working in England) in our guidance for sessional GPs.
If you are in the 2015 scheme in England, Wales and Northern Ireland, your pension contribution tier is based on your anticipated annualised NHS GP earnings.
Annualised income is your total GP pensionable earnings (earned during the scheme year from 1 April to 31 March) divided by the number of days of pensionable service and multiplied by 365. If you hold a concurrent Type 1 or Type 2 post for the full pension scheme year, 1 April to 31 March, annualising will not apply to you. Type 1 and Type 2 practitioners get full 24/7 cover during periods of pensionable employment but if you are solely a GP locum you are only covered on days you actually work. Annualising can increase the cost of your membership but does not impact the level of benefits you will receive.
Membership in the 1995 or 2008 sections based contributions on your anticipated actual GP pensionable earnings. Since all active members are in the 2015 CARE scheme since 1 April 2022 all GPs in England, Wales and Northern Ireland are subject to annualising. Scotland has not implemented annualising yet.
There is a tiered contribution structure for all members. The percentage contribution required to be paid into the scheme will depend on what level of income you earn (annualised income where applicable).
You will need to pay the appropriate percentage against 90% of your gross locum earnings. 10% is considered to represent expenses, which are not pensionable in the NHS pension scheme.
Because of the McCloud remedy on age discrimination, we expect any members who contributed more as a result of annualising in the 2015 scheme, to be able to claim a reimbursement of overpaid contributions in their legacy scheme.
Members in scope of the remedy will be rolled back to their legacy scheme for the remedy period (1 April 2015 to 31 March 2022).
Annualising did not apply to GP contributions in the 1995 and 2008 sections.
Your pensionable income will be credited against the month the work was undertaken rather than when the monies were paid.
However, it is not unusual to find that work undertaken at the end of the scheme year in March can be credited at the beginning of the scheme year in April and this can result in discrepancies in your records.
GPs in England should refer to their employee contribution statements in PCSE records to check their income.
If you undertake other GP pensionable work as well as your locum work, your contribution tier will be based on your total anticipated GP earnings (annualised income where applicable). Other GP pensionable work will require that end of year certificates are completed (Type 2 form for Salaried GP or SOLO work or Type 1 for Partnership work). GP benefits on retirement are based on total career earnings.
If you have previously contracted to purchase added years/ additional pension or the early retirement reduction buyout (ERRBO) then you will also need to pay these contributions. It is worth checking with your scheme administrator that these contributions have been received.
GP locums working in England can check their PCSE Employee Contribution Statements at the end of the scheme year to ensure that all income has been credited correctly. You should then use the NHS Pensions Annualising calculator to check that your pension contribution tier is correct.
If you have underestimated your tier during the year, you need to ensure that you amend this during the year and any additional corrections can be made at the end of the year.
If you overpay, at the end of the year you will need to claim the monies back, either from your employer or from the primary care administrator, depending on the role held when the overpayment occurred.
Overpayments made as a salaried GP will not necessarily correlate to any reimbursements that the primary care administrator needs to make to the practice. In England, PCSE (Primary Care Support England) will look to ensure monies deducted are balanced between them and the practice based on the estimate form and correct final earnings. Reimbursements between a salaried GP and the practice will be based on the salaried GPs end of year Type 2 certificate and not on the balancing between PCSE and the practice. Practices should not need to wait on any reimbursement from PCSE in order to repay overpaid contributions to the salaried GP but this may be affected by the size of the overpayment.
Locum overpayments are reimbursed directly from the primary care administrator (PCSE in England).
Guidance can be found on the Primary Care Support England website.
England and Wales
- Your employer pension contribution is paid by the practice to you.
- You need to forward this amount (currently limited to 14.38% of the 90% pensionable amount), plus your own contribution, to PCSE (local health board in Wales) via forms A and B.
- Although the employer contribution has increased to 20.68%, you need to continue to request only 14.38% from any employer as the remainder will be made up by the Treasury directly.
Scotland and Northern Ireland
- Your employer contribution is paid by your primary care organisation as long as you continue to satisfy the relevant scheme conditions for being a locum.
- The employer contribution is 20.9% in Scotland and 22.5% in Northern Ireland.
You are only able to pension NHS earnings received directly from a practice. Locum work undertaken via a locum agency or deputising firm cannot be pensioned in the NHS pension scheme.
Additionally, you are not able to pension locum work that was carried out more than ten weeks ago.
It is important that you complete the A and B forms in a timely fashion and return them, with your contribution, to your host PCO or PCSE. This should be no later than the seventh of the month following the month that the pay you are pensioning was received in. GPs in England are able to use the PCSE portal to submit locum forms and to make payments.
For example, payments received in July must be pensioned by 7 August. Form B relates to payments received in the month, rather than work undertaken in the month. However, pension records will allocate pensionable income to the month worked.
In order to be able to pension all earnings it is important that you receive payments from the practices you have worked at within 10 weeks of undertaking the work. The 10 week rule was reinstated in England and Wales from 1 October 2022. GP locum work undertaken before that date currently has no time limit to pension the income but work undertaken on 1 October 2022 and after needs to be pensioned within 10 weeks of completing the work.
You can locum there again once you have had a one month break.
In England and Wales, you can continue beyond six months and decide whether you wish to pension via locum forms A and B or ask your practice to be treated as though you are a salaried GP (in pension terms only).
In Scotland and Northern Ireland, you will be pensioned as a salaried GP if you work beyond six months in the same practice without a month break.
You are able to pension locum earnings via forms A and B so long as it is not in respect of locum work undertaken in your own practice. It is optional as to whether you pension this income or not.
Locum work at your own practice is pensionable in the same way as your main practitioner earnings and should be detailed on your end of year certificate. You must pension this locum income.
Locum work at other practices should be pensioned via the completion of locum forms A and B, detailed above.
You are able to pension locum earnings, even for locum work undertaken at your own practice.
This income should be pensioned via the completion of locum forms A and B, detailed above in addition to the Type 2 certificate completed for pensioning salaried GP work.
It is also possible to undertake pensionable overtime at your own practice which will be pensioned in the same way as your main salaried GP income.
Locum GPs who conduct appraisals are able to pension any income earned from doing so, via forms A and B. As with GP locum work you can choose whether you want to pension such work or not.
If you are solely a GP locum and an appraiser, you should use locum forms A and B to pension your GP appraiser income.
It will not be possible for you to pension your earnings in the NHS pension scheme if you have processed your earnings through a limited company.
If you work exclusively as a locum, you are only able to contribute into the scheme during periods when you are actually working.
You are not able to make up contributions that you would otherwise have made had you not been on maternity, sickness or any other absence.
If you are working exclusively as a GP locum, you can simply stop pensioning your GP locum earnings by not completing forms A and B.
If you hold Type 1 or Type 2 roles you can opt out of NHS pension scheme membership and not pension your GP earnings should you wish. In England and Wales you can also choose to pension GP locum income or not. As this may a have detrimental impact on your final pension benefits you should discuss this with an independent financial adviser
If you are working as a GP locum concurrently with other GP work either as a principal or assistant GP, then you may choose whether:
- to opt out of pensioning your type 1 and 2 work by completing an opt out form or
- opt out of your locum work (by not completing forms A and B) or
If you are working as a GP locum concurrently with other GP work, either as a principal or assistant, then you will have to opt out of pensioning all GP work.
It is not possible for you to opt out of pensioning your locum work whilst still contributing as a type 1 or type 2 practitioner.
It has been proposed that in Scotland from 1 October 2023 separate GP employments can be pensioned independently, opting out of some but in for others. This has not yet been implemented.
Calculating your pension
Your benefits at retirement will be based on your total career earnings.
If you had membership in the 1995 section, your total GP earnings accrued in the 1995 section will be multiplied by an accrual factor of 1.4%, after the income has been brought up to date with current earnings by a mechanism known as dynamising.
Your pension keeps up with inflation by being based on current rates of pay/recently dynamised income. Dynamised income is increased in line with pensions increases plus 1.5%. This means that if CPI (consumer price inflation) growth is nil or negative the dynamising factor applied to increase GP income will be 1.5%. This link continues if you have practitioner service in the 2015 scheme and for so long as you do not have a break in pensionable service of 5 years or more. If you have a break in pensionable service of 5 years or more this ‘final salary linking’ is lost and applies up to the last day of pensionable service before the break. Thereafter the service is linked to pensions increase orders without the additional 1.5%.
If you had membership in the 2008 section of the NHS pension scheme, your total GP earnings accrued in the 2008 section will be multiplied by an accrual factor of 1.87%, after the income has been brought up to date with current earnings by dynamising.
Your pension keeps up with inflation by being based on current rates of pay/recently dynamised income.
Dynamised income is increased in line with pensions increases plus 1.5%. This means that if CPI (consumer price inflation) growth is nil or negative the dynamising factor applied to increase GP income will be 1.5%. This link continues if you have practitioner service in the 2015 scheme and for so long as you do not have a break in pensionable service of 5 years or more. If you have a break in pensionable service of 5 years or more this ‘final salary linking’ is lost and applies up to the last day of pensionable service before the break. Thereafter the service is linked to pensions increase orders without the additional 1.5%.
From 1 April 2022 all active membership is in the 2015 CARE scheme. If you are a member of the 2015 scheme, 1/54th of each year’s earnings goes towards your pension and is revalued by the consumer prices index plus 1.5%.
If you transitioned to the 2015 scheme from the 1995 or 2008 section
If you have transitioned to the 2015 scheme and have benefits in the 1995/2008 sections, these will retain 'final salary' linking (continue to be increased in line with the consumer prices index plus 1.5%) providing you continue to hold a pensionable GP role (Type 1, Type 2 or GP locum). If you work only as an officer your GP income is no longer dynamised.
This is as long as you do not have a break in pensionable service of five years or more. If you have a break in pensionable service of five years or more, your previous GP benefits will be increased in line with the consumer prices index only.
The McCloud remedy will mean that members in scope will be restored to their legacy section for the remedy period (1 April 2015 to 31 March 2022).
Ill health retirement and death in service
To qualify for consideration for ill health retirement as an active member of the scheme you will need to make your ill health application whilst actively contributing to the scheme. Outside of this, your application will be treated as for a deferred member.
Death in service
If you work exclusively as a locum GP, you will only be covered for death in service benefits if you are in active pensionable employment on the day of death. NHSBSA (NHS Business Services Authority) details the provision here.
Instead, you would be covered by the death in deferment rules applicable to those who are not in active pensionable service at the time of death.