June 27, 2025

Will the NHS Annual Allowance Scheme Pays Deadline Be Extended?

If you are a doctor with an NHS pension, you might have a tax charge from the 2019/20 tax year. The NHS set up a scheme to help with this, called the Annual Allowance Charge Compensation Scheme. Any compensation due will be paid in retirement, and will offset the reduction to your pension from using Scheme Pays for 2019/20 Annual Allowance charges which a member chooses to meet using the NHS Pension Scheme Pays mechanism. The deadline for the Scheme Pays choice by 31st July 2025.
Author
Michael Harms APFS, Director and Chartered Financial Planner

‍Why This Deadline Matters to Doctors

This deadline is important if:

  • You had a pension tax charge in 2019/20
  • You want the NHS Pension Scheme to pay it for you
  • You need to make changes to your Scheme Pays choice

If you miss this deadline, you might have to pay the tax yourself.

Problems with Pension Statements

Many doctors still don't have the right information to work out their tax charge. This is due to delays in receiving pension statements called "Remediable Pension Savings Statements" (RPSS).

Off the back of remediation required after the McCloud judgement (also known as the Public Service Pension Remedy) these statements address the pension recalculations required from 2015 to 2022 (the remedy period). They should have been sent by October 2024, however, by April 2025:

  • Only 57,000 out of 137,000 statements were sent on time
  • 23,000 of these had  information
  • Many doctors still don't have their statements

Without these statements, you can't be sure about your 2019/20 tax charge (or subsequent potential annual allowance tax charges)

What Has Been Done So Far?

HMRC knows about these problems. They have:

  • Extended the normal Scheme Pays deadline to 31st July 2025
  • Said that doctors can use estimates if they don’t have the right information

The mandatory scheme pays deadline is crucial as it ensures that payments for the annual allowance charge are made to HMRC by a specific date, with extensions available for members affected by rollback.

The NHS Business Services Authority (NHSBSA) has also said they will accept late Scheme Pays choices. The Department of Health and Social Care promises that “no one will face any financial detriment” because of these delays.

What Financial Experts Are Saying

Financial advisers are worried that the July 2025 deadline is not realistic. Many doctors still don't have their pension statements, so they can't confirm their tax charge.

The British Medical Association (BMA) has asked for more time. They want the government to extend deadlines because of these problems.

What Should Doctors Do Now?

While there is no official extension yet, all signs suggest that help is coming. But you should still:

  1. Submit your Scheme Pays choice by 31 July 2025 if possible
  1. Use estimates if you don't have your final figures
  1. Keep checking for updates from the NHSBSA

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