There has been a recent Appeal Commissioners’ decision regarding the employment status of locums. This case dealt specifically with the “Out of Hours Service” – an initiative between the HSE and GPs to have locums available at night or at the weekend. It was decided that these locums were in fact employees of the GPs and that the GPs had a contract of service with each locum. Buoyed by this, the Revenue have argued that in many cases locums contracted by GP practices are also employed in a contract of service, i.e. are employees of the practice. As a result, many locums are being taxed at emergency rates, particularly for very short-term engagements, as it is not possible to register them as employees in such a short space of time.
The Revenue do accept that there should be no "one cap fits all" approach, i.e. that it cannot say all locums are employees. Whether a locum is an employee or self-employed depends on the nature of the relationship and the Revenue are prepared to revert to the “Code of Practice for Determining Employment or Self Employment Status of Individuals” and the applicable case law in each situation.
Inevitably a locum will display characteristics of both an employee and a self-employed individual. Therefore to be absolutely sure of the correct tax treatmenet, correspondence with the Revenue may need to be entered into. Needless to say, this could take some time and in the meantime the locum has been and gone and needs to be paid by the practice.
If you are a locum or you employ locums in your practice and you require expert taxation advice please do not hestiate to contact us on 021 4310266.