Practice expenses

Most GPs have adopted the practice of making annual claims for income tax purposes in respect of amounts paid out privately in connection with their practice. Typical expenditure of this nature includes:

1. •

   medical subscriptions

2. •

   motor car and travelling expenses

3. •

   personal telephone charges, and

4. •

   salaries and benefits paid to spouses

Where a doctor or dentist is a sole practitioner, such disbursements are normally charged in the practice account. They are expenses incurred wholly and exclusively in connection with their profession and are allowable. They are treated as any other expense of the business.

In the case of a medical or dental partnership, it is necessary to establish which expenditure should be paid out of partnership funds and which are to be borne personally by the practitioner. In ideal circumstances, this will be set out in the partnership deed. Often the deed is silent and the position should be confirmed in writing.

In these circumstances, the partnership accounts do not reflect the full costs of the partners. It is important that the practitioner receives the relief due on such expenditure. This is usually achieved by the submission of a practice