‘I owe £7,500 in tax after working one NHS shift'

Telegraph

29-01-2025

When Dr Leon Creaney opened his pension statement, all he wanted was a small amount of growth. After all, he'd spent three years working on the NHS's frontline after stepping back in to help during the Covid 19 pandemic.
Instead, he found himself
Reflecting on that day, he says: 'My worst possible fears were realised. I opened up this letter expecting it to be a couple of hundred pounds growth for each year. I almost fainted.'
The saga began in April 2020 at the height of lockdown. Dr Creaney, who is 47 and lives near Manchester, decided to work an A&E shift at his local hospital.
At the time,
It was simple for people in
For NHS pensions, however, the perceived growth of someone's benefits was measured against the allowance – and the calculation was extremely complex.
Dr Creaney had carefully managed how much went into his private pension, but his hospital shift came right at the end of the tax year and added another £57 into his NHS pension.
This triggered a calculation which, due to historic inflation, found his benefits had grown by £17,500 – meaning he had breached the allowance and a
Graham Crossley, of Quilter, said that even today it was possible for £1 of additional income to generate a £22,500 tax bill.
He said: 'Due to a quirk in the way that the 1995 Section pension is calculated, it's the application of inflation to Dr Creaney's historic pensionable pay, triggered by just that one shift he worked, that caused this pension growth.
'However, it's not real growth until you take the pension benefits, so his pension hasn't gone up by £17,500, but that's the calculation of how much the value of his overall benefits has increased.
'Had he waited a few weeks until the new tax year to work, it's likely he wouldn't have faced any tax charge but still built up the same pension benefits. It's very unfair.'
Back in early 2020, Dr Creaney had feared something like this was coming and tried to rectify it.
In the June following that shift, he contacted the NHS Business Services Authority to inform them he was back working in the NHS and
By now he was working one to two shifts a week, and as he was
Five months later, he had not received a response and followed up by email – only to be told there had been no contributions to his pension since he first left the NHS in 2018.
He says: 'They told me in writing that I had no pension growth for 2019 to 2020. I left it. For a couple of years, we were just dealing with the fall out of lockdown, so I didn't chase it up.
'By the end of 2022, I chased it up and said: I need to know my tax liability. You've given me no information for years now.'
Three years after that first shift, his pension statement finally arrived. To his horror, he was told he had exceeded his
More tax bills running into the thousands could be on the way, and Dr Creaney says he has not been told how much they would be.
He says: 'This has caused me unbelievable amounts of stress for five years in a row now. I can't work for the NHS again. I can't run the risk of doing one shift that generates 12.5 times the amount I earned [in tax].
'I was quite happy doing a couple of shifts a week up to then. It's kind of like that drop dead moment. It really does feel like a massive kick in the teeth. Thanks for your service and now we're going to punitively tax you as much as we can.
'In a private pension, you can estimate how much you'll get. With the NHS pension, it's this random number you can't guess. You can't estimate yourself.'
He is still waiting for a remedial pension statement. Due to the McCloud remedy – which will affect all NHS staff in the pension scheme before 2012 – his pension will require two calculations,
In the meantime, his local MP has written to Wes Streeting, the health secretary, on his behalf. He has also launched a County Court claim against the NHS pension scheme for 'the tax they fooled me into earning'.
He says: 'One of the reasons I've taken this to court is this really horrible and stubborn refusal to ever admit any wrongdoing from NHS pensions. This really arrogant denial that they've ever done anything wrong or made any mistakes is really annoying and I want them to apologise.
'I would go back if it was sorted out.'
Sadly, Dr Creaney's situation is far from unique. The British Medical Association has previously warned that pension rules were pushing doctors into retiring early.
As recently as November, it said doctors were
The NHS Business Services Authority itself has also admitted that more than
Dr Creaney is largely working privately in Manchester. He is also employed by British Athletics and will be the team's doctor at the upcoming World Indoor Championships in China.
He is concerned that the issue he faced is affecting the NHS's long-term future.
He says: 'I'm aware of doctors who say that pension tax is so punitive that they're effectively paying to go to work and it's not worth doing extra shifts for the NHS. Surgeons are refusing to do waiting list initiative shifts.
'There's already a shortfall of doctors in the UK. We're a skeleton service anyway. There's an epidemic of GPs retiring early. Medical school applications are going down.
'Issues like this will make it worse. They already are.'
Both the NHS Business Services Authority and the British Medical Association declined to comment on individual cases.
Quilter has offered to work on Dr Creaney's case pro bono.