Introduction - VWV
VWV - a full service law firm
Partnerships, property, disputes, CQC, employment
450+ Practices
RCGP Book
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Making recruits “stick”
Mutual assessment period
Naivety re: accounts/tax. Do GPs explain it properly?
An hour with an accountant is worth paying for
Resist urge to skim over difficult conversations
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Non property owning partners - freehold surgeries
Be wary of allowing non-property owners into a freehold surgery – longer term
implications can include:
Splits in the partnership
Retired partners continuing to own – ill feeling either way?
Small number of partners selling to investor – bad feeling
Leases – legal and SDLT costs
Loss of control of practice’s main asset
Tax issues for all partners
Having non-property owning partners is an option but not one that should be entered into
without planning
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What to do during recruitment process
Make sure Partners are clear beforehand about property offer (or not)
Make it clear to recruits from the start
Set expectations – and trumpet benefits of ownership
Sign partnership deed on or before the date they join
Deed should include an obligation to buy in
Can’t absolutely make them buy in – but at least can expel (or renegotiate)
if they later refuse.
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What if you just cannot find willing POs
Then take on an NPO – but with clarity as to…
How it will work in practice (what costs NPOs still bear)
Make sure they are clear that there is liability either way
Be clear as to long term – there’ll be a lease at some point
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A reimbursed lease can still be a liability
Freehold
Leasehold
Building
Bank loan
Building
Lease liability
- Not a problem - so long as
’ i b
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h
Retired partners continuing to own
Retired partners sometimes want to hang on to premises
Need a lease (otherwise how do they get their NR)? That means SDLT and
legal costs
Sometimes can frustrate current partners
Often wrangles about valuation – can you impose one and settle it, or is
there still a “deal” to be done?
Be clear what the documents say. Can you make them sell?
Usual position – retired partner sells on retirement, but receives interest
at level of NR until his capital is repaid
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Sale and leaseback
Lots of it at the moment – esp Wales
Good for Ps close to retirement – they realise capital and will be protected by
continuing partners
Bigger risk for younger partners who are signing up to a long lease
The “value” for the older Ps is created by the younger Ps agreeing to be there long
term
All Ps have effective veto. Why would NPOs sign – what’s in it for them?!
NB – if someone offers you £1m for a sale and leaseback – it doesn’t mean
surgery is worth £1m without a lease!
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