GP Committee responds to Rachel Reeves’ proposed LLP tax plans

The Independent Doctors Federation GP Committee is increasinly concerned about the governments' proposed taxation changes targeting Limited Liability Partnerships (LLPs). The reform would introduce a new tax burden on LLP members, significantly increasing operational costs for many independent healthcare providers across the UK. 

LLPs are not tax avoidance vehicles. They are legitimate, practical structures that allow clinicans to manage shared responsibilities, limit personal financial risk and operate scalable, flexible practices. This is particularly important for GPs and specialists who are also employers, investing in staff, infrastructure and care delivery without public subsidy. 

We are concerned that applying an employer-style National Insurance levy to LLP profits, without careful consultation, may lead to serious unintended consequences. For a typical doctor operating through an LLP, this could mean an additional £15,000 - £25,000 in tax each year, a substantial discincentive to maintain or expand services at a time when the NHS urgently needs additional capacity. 

The policy also risks delaying investment and driving up the cost of patient care, particularly in primary care settings already under strain from workforce shortages and rising demand. The indepenent sector plays a vital role in delivering diagnostics, outpatient care, urgent appointments and workplace-based services, often on behalf of the NHS. These are not peripheral extras, but core clinical services supporting national health delivery. 

Public demand is also shifting. According to the Indpendent Healthcare Providers Network (IHPN), around one third of people in the UK have accessed private healthcare at some point in their lives at 71% say they would consider doing so in the future, up from 64% just two years ago. The independent sector is clearly playing a growing role in meeting the public's healthcare needs.

If independent clinical LLPs are penalised, we risk losing essential system capacity, especially in areas where NHS access is already limited. That could deepen regional inequalities and make it harder to reach high-need or underserved communities. 

We fully support the principle of fair and sustainable taxation. At the same time it's important to recognise the unique position of independent GPs and specialists, many of whom take on both financial and clinical risk often without the pension, sick pay or employment protections available to salaried NHS staff. Much of their income is reinvested directly into service development and patient care. These are not financial instruments, they are health services and tax policy should reflect that distinction. 

We welcome the government's broader commitment to a resilient, patient-centred health system and its recognition of the independent sector's contribution to reducing waiting times and expanding access. However, this proposed tax change risks underminding that progress. 

Rather than strengthening collaboration, it could send an unintended signal that independent healthcare professionals are a fiscal target, rather than a strategic partner. If the government wants to revisit how LLPs are taxed, it must do so in consultation with healthcare providers. That means working with the IDrF, with GPs, and with integrated care systems to make sure essential frontline services aren't caught in the crossfire of fiscal reform. Clinically delivered services must be protected.