As a dentist, the focus is on patients. Most of the day is spent diagnosing, treating, and improving oral health. But running a dental practice brings financial responsibilities that are just as complex as the clinical work.
Whether working as an associate, managing a dental practice, or planning to retire, the right financial support is essential. Not just from any accounting firm – from one that understands the dental industry inside out. A specialist dental accountant can support financial health, manage finances efficiently, and guide a practice toward long-term financial success.
Why a Specialist Accountant Matters
Dentistry is different. From NHS pensions to goodwill valuations, the dental profession faces unique financial challenges and cash flow demands. A general accountant may help with compliance, but is unlikely to offer the detailed, relevant advice that supports growth, reduces costs, and avoids risk.
Here are some areas where specialised knowledge makes a real difference:
1. NHS vs Private Income
Many dentists have a mix of income types. NHS contracts come with specific rules, while private earnings can vary widely. A dental accountant understands how to report, plan, and structure both. Their expertise ensures compliance and maximises available deductions.
A generalist may not understand how UDA targets affect income or how to account for NHS pension contributions – potentially resulting in missed opportunities or poor advice.
2. Tax Planning That Fits Your Career
Dentists move through distinct stages in their careers:
- Associate
- Practice owner
- Expansion
- Retirement
Each stage brings different tax and structuring decisions. A specialist accountant ensures allowances are maximised, liabilities reduced, and plans aligned to future goals. For example:
- Should a practice be incorporated as a limited company?
- How can capital allowances and tax relief be used effectively?
- What’s the most efficient way to extract profits using strategic tax planning?
These are questions dental accountants answer daily.
3. Good will and Practice Sales
For those buying or selling a dental business, goodwill valuations and deal structures are critical. A specialist accountant understands how to value a practice accurately and guide on share vs asset sales and their tax implications.
Their input ensures smooth due diligence, identifies risks, and helps with retirement planning or reinvestment strategies.
4. Benchmarking and Performance
Specialist dental accountants often provide benchmarking data based on national performance. This helps compare income, profit margins, overhead costs, and cost control with other practices.
These insights can highlight inefficiencies, support financial forecasting, and drive improvements in managing payroll, billing processes, and equipment investments.
5. NHS Pension Advice
The NHS pension scheme is complex. Contributions, thresholds, and limits all impact future benefits and tax obligations.
Specialist support helps with:
- Interpreting pension statements
- Avoiding unexpected tax charges
- Integrating pensions into long-term retirement planning
What to Look for in a Dental Accountant
Not all accountants offer the same level of insight. Consider the following when selecting support for a dental business:
1. Proven Dental Experience
Look for experience with NHS contracts, UDA income, and dental practice structures. A good indicator is whether the firm serves a range of dental professionals.
2. Proactive Tax Planning
Effective tax planning is essential. Look for providers who offer:
- Annual reviews
- Forecasting
- Profit extraction strategies
- Advice on pensions, allowances, and tax laws
3. Support with Practice Changes
An experienced accountant will assist with practice purchases, expansions, and sales – including financial assessments, liaising with solicitors, and ensuring tax-efficient structuring.
4. Digital Tools and Efficient Systems
Modern systems such as cloud-based accounting, digital VAT submissions, and Making Tax Digital compliance make reporting smoother and improve decision-making.
5. Clear, Honest Communication
Reliable accountants explain things clearly, without jargon. Look for professionals who build long-term relationships and provide honest, strategic guidance and support.
Common Mistakes Dentists Make
- Leaving tax planning too late
- Not claiming capital allowances
- Confusing drawings with profit
- Forgetting to plan for pension contributions
- Using an accountant unfamiliar with the dental profession and unique financial needs
These issues are avoidable with the right accountancy services.
Red Flags Your Accountant Isn’t Specialist Enough
- No questions asked about NHS/private income mix
- No benchmarking or financial performance insights
- Unclear advice on capital allowances or pension tax
- Only basic compliance services offered
- No familiarity with basis period reform or MTD changes
These are signs that specialist support may be needed.
Practical Scenarios: How Specialist Advice Makes a Difference
Scenario 1: Missed Allowances
A sole trader dentist hadn’t claimed capital allowances for previous surgery upgrades. After a review, amended filings recovered over £16,000 in tax.
Scenario 2: Practice Incorporation
A private practice incorporated on specialist advice, saving over £10,000 in National Insurance annually and gaining pension flexibility.
Scenario 3: Selling a Practice
With early guidance, a dentist nearing retirement maximised the goodwill valuation and secured Entrepreneurs’ Relief during the sale.
Industry Changes Every Dentist Should Know (2024–2026)
- Basis Period Reform (2024–25): A standardised income reporting period may lead to transitional overlaps and larger tax bills.
- Making Tax Digital (2026): Dentists earning over £50,000 must file digital quarterly income updates.
- National Insurance (2025): Employer contributions will rise to 15%, increasing staffing costs.
- NHS Charges (2025): Rising patient fees mean practices must reassess pricing.
Staying up to date with legislation ensures better planning and fewer surprises.
Free Checklist: Is Your Accountant Truly Supporting Your Practice?
Choosing the right accountant can directly impact your bottom line, long-term growth, and peace of mind. Use this quick self-assessment to see if your current support is truly specialist:
Tick all that apply:
- My accountant is familiar with both NHS and private dental income
- I receive annual tax planning reviews
- I’ve had clear advice on NHS pensions and retirement planning
- My accountant explains capital allowances and helps claim them
- I’m given benchmarking insights against other practices
- I’m regularly updated on regulation and tax law changes
- I’ve had support with practice sale, purchase, or incorporation
How did you score?
- 0–2 ticks: You’re likely missing out on essential support.
- 3–5 ticks: You’re getting some value but could benefit from more proactive, specialised advice.
- 6–7 ticks: You’re in a strong position — but make sure your accountant keeps up to date as the landscape evolves.
FAQs:
Choosing and Working with a Dental Accountant
Should a practice be incorporated?
This depends on income, goals, and contract type. A specialist will assess and explain the impact.
When should retirement planning start?
Ideally 5–10 years ahead. This allows time to optimise pension and profit extraction.
Is a specialist accountant worth the cost?
Often, yes. Savings through planning usually outweigh the additional fees.
Can a dental accountant help with practice purchase?
Yes. From valuation to lender communication, specialist input is essential.
How often should reviews take place?
At least annually, more frequently during key transitions.
Final Thoughts
Managing finances in dentistry requires more than routine accounting. A specialist dental accountant can save money, provide strategic guidance, and help plan confidently for the future.
From associate to retirement, the right accountant brings clarity and valuable insights to every stage. Choosing carefully is one of the most impactful financial decisions a dental professional can make.
For those seeking experienced support, Staffer Mayled Cardiff is a trusted name among dental professionals, offering expert advice, practical tools, and tailored support for practices across the UK.
