'Victory for common sense' as it emerges NHS Highland bullying victims will not be taxed on compensation payments
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A ruling that most payments made to NHS Highland bullying victims will not be subject to tax has been welcomed.
It follows a review by HMRC which said payments made with reference to harm and healing are not taxable.
Only those made for loss of earnings while employed at NHS Highland are subject to tax.
The health authority apologised for initial confusion but welcomed the decision and said the majority of participants in the Healing Process, an independent service to help individuals, would not have to pay tax.
NHS Highland chief executive Pam Dudek, said: "We sincerely apologise for upset and harm caused by the initial confusion on what the tax situation would be for this unique service.
"While we sought in good faith to make payments as quickly as possible once recommendations had been approved, in retrospect, delaying payment while we sought clarification from HMRC might have been advisable."
Highlands and Islands Labour MSP, David Stewart described it as a victory for common sense.
"Constituents have been writing to tell me the huge amount of tax they have had to pay, sometimes on a relatively small amount of compensation," he said.
"That has not only caused them further upset and harm, but in some cases has disrupted their benefit or pension payments."
Conservative MSP Edward Mountain said the faulty advice should have been spotted when the Healing Process started last May.
"This tax fiasco could have been avoided from the beginning had NHS Highland raised this issue with HMRC earlier," he said.
"This would have spared bullying victims from a lot of additional pain, hurt and financial worries."
Brian Devlin, former head of NHS Highland communications and a victim of bullying in the organisation said the health authority had been forced into a humiliating climbdown.
"NHS Highland had literally one job to do and that was to administer the payout of the settlements that the Independent Review Panel had agreed on," he said.
"They weren’t asked or trusted to do anything else and they managed to create utter chaos with it."
He added the healing process was not perfect but was a huge success and urged everyone fitting the criteria to sign up before it was too late.
The closing date is February 26.
Related story: MSP concerned about lack of records on legal advice taken by NHS Highland over bullying payments
