Premises & Finance

2026/27 at a glance

Practice income: know where your money comes from

Premises funding: the Premises Costs Directions 2024

Premises reimbursement for GMS practices is governed by the NHS (General Medical Services – Premises Costs) Directions 2024, which replaced the 2013 Directions from 10 May 2024. PMS agreements may still fall under earlier Directions, so check your agreement. Key points:

• Improvement grants of up to 100% of project value are now possible, up from the previous maximum of 66%. Grants can also fund land for extensions, and fit-out of newly leased premises. However, no new money came with this change, so ICBs still have limited budgets.
• Guaranteed use periods and clawback: grants now come with defined minimum-use periods (up to 18 years for the largest schemes). Grants can be repaid if the building stops being used for NHS primary medical services during that period. This is a serious consideration for succession and sale plans.
• Notional rent reviews: practices that own their premises have 12 weeks to accept or challenge the market rent assessment. If you don't respond in time, you may lose the right to challenge it.
• VAT: when taking a new lease, practices must use reasonable efforts to agree with the landlord that VAT will not be charged on the rent.
• Overpayments: practices must notify NHS England or the ICB of any overpayments, and these can be clawed back.
• Lease assignment on contract hand-back: the 2024 Directions allow a lease to be assigned to a nominee of NHS England if a practice returns its contract and no successor can be found.
• Minimum standards: premises must meet the minimum standards in the Directions. Grants will not usually fund work needed only to bring a building up to those standards.

Leases and personal liability

In a partnership, lease obligations usually fall personally and jointly on the partners who signed the lease. They can also fall on partners who joined later, depending on how the lease was assigned or held. This is one of the main reasons GPs are reluctant to become partners, and why "last partner standing" situations are so dangerous.

• Know exactly who the named tenants and guarantors are on every lease, and keep this under review as partners join and leave.
• Make sure your partnership agreement deals with how lease liabilities are shared, and with what happens when a partner retires.
• Diarise break clauses, lease expiry and rent review dates. A missed break date can lock you in for years.
• Budget for dilapidations at the end of a lease.
• If you occupy premises without a written lease, get advice before signing one. Also see the NHSPS section below.

• BMA – GP practices guidance

  Includes premises guides on rent reimbursement, GP premises leases, a template lease, service charges and the GP sustainability loan scheme

NHS Property Services (NHSPS) and Community Health Partnerships (CHP)

Many practices in NHSPS or CHP buildings have faced large increases in service charges, sometimes backdated. The BMA's legal action on behalf of five practices led to substantial reductions in the amounts demanded. The BMA's current advice is:

• Service charges are payable only as far as your lease provides. Receiving a service does not in itself create an obligation to pay for it.
• If you have no lease, continue to pay at the level you have historically paid, based on custom and practice, until a lease is agreed.
• Do not ignore demands. The court warned against a policy of refusing to engage. Challenge charges that appear inaccurate, and ask for a breakdown.
• Get independent legal advice before agreeing any debt settlement or signing a new lease with NHSPS.

• BMA – NHS Property Services guidance
• NHS Property Services

Partnership finances

Have a written, up-to-date partnership agreement

Without one, you are a "partnership at will". In a partnership at will, any partner can dissolve the partnership by giving notice, which can put the practice's contract, and potentially the premises, at risk. A good agreement covers:

• profit shares, drawings and how capital is held
• property ownership and what happens to property shares on retirement
• notice periods, retirement and 24-hour retirement
• decision-making and voting
• sickness and parental leave
• how lease and other liabilities are shared
• how disputes are resolved

Review it whenever a partner joins or leaves, and at least every few years. Make sure every current partner has actually signed it.

Financial management

• Monthly: review the payment statement, cash flow, and claims submitted against claims paid.
• Quarterly: review management accounts against budget, staffing costs and QOF progress.
• Annually: review year-end accounts with a specialist medical accountant, set the business plan, and reserve for tax and pension liabilities.
• Keep drawings below profits. Overdrawn partners and under-reserved tax bills are a common cause of partnership disputes.

• AISMA – Association of Independent Specialist Medical Accountants

  Find an accountant who specialises in GP practices, and see national GP earnings benchmarking

NHS pensions

Practice responsibilities

• Estimates: at the start of each year, submit estimated pensionable profits for GP partners (and non-GP partners), so that contributions are collected at the correct tier rate throughout the year.
• End-of-year certificates: GP partners complete a Type 1 certificate, and salaried and locum GPs complete a Type 2 certificate. Certificates are due by 28 February, almost two years after the start of the scheme year. For example, 2025/26 certificates are due by 28 February 2027, and 2026/27 certificates by 28 February 2028. Submit them through PCSE.
• Underpayments: where contributions have been underpaid, the arrears are paid by the surgery, not the individual, even if the GP has left. Accurate estimates protect the practice.
• Locums: complete the locum's GP Locum A form promptly each month, so they can submit their pension contributions on time.
• Staff: make sure payroll applies the correct member tier and the 14.38% employer rate.

Key issues for individual GPs

• Member contribution tiers range from 5.2% to 12.5%. The rates are unchanged, but the pay thresholds were uplifted from April 2026.
• The lifetime allowance was abolished in April 2024. It has been replaced by the lump sum allowance and the lump sum and death benefit allowance.
• The annual allowance is £60,000, and is tapered for high earners. GP partners with volatile profits can still face annual allowance charges. Scheme Pays may be an option.
• McCloud remedy: GPs with service before April 2015 will make a choice between the 1995/2008 and 2015 schemes for the remedy period. This is usually made at retirement.
• 24-hour retirement and retire-and-return have contract, partnership, CQC registration and Performers List implications as well as pension ones. Plan well ahead.

• NHS Pensions (NHSBSA)

  Forms, certificates, estimates and member guidance

• NHSBSA – Employer contribution rates 2026/27
• Primary Care Support England (PCSE)

  Payments, pensions administration and the Performers List

• BMA – Pensions

  Guidance and pension calculators for members

Succession and sustainability

A practice with one or two partners approaching retirement, a building owned by those partners, and a lease or loan in their names is at real risk. Plan early:

• Make partnership attractive: offer a clear route from salaried GP to partner, reasonable buy-in terms, and a partnership agreement that protects incoming partners.
• Separate property from partnership: not every new partner will want to own property. Think about how property can be held separately, and how outgoing partners can exit.
• Understand grant clawback periods before selling or changing the use of premises.
• Don't become the last partner standing. If you are heading towards a single-handed position, talk to the LMC early. Options such as merger, federation support or a managed transition work far better when planned rather than rushed.

Frequently asked questions

Key resources

• NHS England – Changes to the GP Contract 2026/27
• BMA – GP practices (premises, leases, service charges)
• BMA – NHS Property Services guidance
• Primary Care Support England
• NHS Pensions
• AISMA – specialist medical accountants