Scottish independence… a real mouthful
With less than a year to go until the 2014 referendum on Scottish independence, you can barely go a day without hearing another story from one side of the debate or the other. The main issue behind all of the stories is the conflicting research and comments that are made.
But what does this really mean for you and your dental practice? Without claiming to have a crystal ball, or coming down on one side of the fence or the other, there are two fundamental areas that need to be further examined if Scotland votes ‘Yes’ on 18 September.
While there is no way to draw any conclusions, or even predict how this will be affected, it is a widely accepted key issue. Everyone wishes to be in the position that they feel comfortable and secure when they retire.
You, as practitioners, will be no different in what you wish for both yourselves, and your staff. However, as business owners, and with the upcoming auto-enrolment regulations, the ongoing cost of all of this will also be a significant factor.
With no firm outcome as to who will be responsible for the government-based pensions that are already in place, there is potential that this will have a massive impact on the money available to the Scottish Government, should the referendum go in favour of the independence.
This itself may be an indirect cost to you and your practice. If the government has less funds available to distribute, then there may be a rethink of what grants and payments are available to NHS dentists. There will also be the potential that the criteria for these will be re-evaluated as a result.
In addition, there may also be the direct costs related to the actual contributions that are required to be made. Again, if this is a cost that rises, this will have a direct impact on you, your staff and the ability to grow your business. Recent quotes have suggested that National Insurance will continue to be paid in line with current regulations, but unfortunately with pensions, it isn’t always as straightforward.
If pensions is a complex area, then tax has had even less said about it in the press, or by either campaigns. If you are working in partnerships or as a sole trader you are already subject to Income Tax at an ever changing rate, as well as VAT on most of the purchases for your business. And if you are an owner in an incorporated business you are also subject to Corporation Tax over and above that. Confused already?
Unfortunately there are no definitive answers to what will happen post referendum if changes are required. The ’Yes’ campaign has predicted that there will be no significant tax changes given the proposed ’Oil Fund’ approach that has been muted recently. Although, helpfully enough, the current government in Westminster has also said that this approach, similar to Norway, will not only result in higher rates of tax being needed to be paid, but also inflation.
Clearly there are some key questions which need to be answered by both parties. At Martin Aitken & Co we are in regular communication with business-owners about their concerns. I feel there are many issues which still need to be debated further and I’m sure the press coverage over the coming months will aim to do this. However, until then these are areas of consideration and concern with no definitive answers, yet.
About the author
Jayne Clifford, partner at Martin Aitken & Co, leads the specialist dentistry team. Jayne can be contacted on 0141 272 0000.