Practice accounting
Practice accounting for NHS, private and plan-mix dentists
The point of practice accounting is not to satisfy HMRC. The point is to tell you, accurately and monthly, where the profit is coming from and where it is leaking. NHS UDA, private fee, capitation plan, lab recharges, associate splits and overhead allocation all need to be separated cleanly before any of it means anything.
Income streams reported separately, always
A dental practice does not have one revenue line. It has at least four, often more. Lumping them together hides the real picture.
- NHS UDA payments (gross of clawback risk and end-of-year reconciliation)
- Private fee income, split by treatment category where it matters (general, ortho, implant, cosmetic)
- Capitation and membership plan income (Denplan, Practice Plan, Whitecross, internal schemes)
- Patient-paid laboratory recharges (frequently mistreated as net income when they should be flagged separately)
- Domiciliary, sedation, referral and other one-off treatment income
- Sundry and non-clinical income (room rent to a hygienist on a self-employed contract, photo licensing for case studies, etc.)
Cost allocation that matches how a dental practice actually runs
Generalist accounting allocates costs by type: salaries, rates, light and heat. That tells you the total, not the relevant detail.
A specialist allocates the costs that vary by income mix: associate fee splits against the income they generate, lab fees against the treatment that triggered them, materials against private vs NHS volume, surgery rent against surgery utilisation. The result is a real margin by income stream, not a notional average.
Monthly review, quarterly conversation
Management accounts you do not read are wasted. The monthly output is packaged as a one-page summary with a short written read on what moved, plus the underlying detail if you want to drill in. Quarterly, the trend gets walked on a call rather than the month.
The point of the call is decisions: are you over-staffing on the dental nurse side, is your private margin growing or stagnating, is your UDA volume trending toward year-end clawback risk, is associate utilisation high enough to justify the split.
Year-end without the year-end scramble
If management accounts run cleanly month by month, the statutory year-end is a tidy-up rather than a reconstruction. Company accounts and corporation tax returns, partnership returns, partner self-assessments and sole-trader returns are all built from numbers that have already been reviewed once, which is the part that keeps a year-end calm. Filing dates are statutory, and the timetable for meeting yours is something the firm agrees with you rather than something quoted here.
Frequently asked
- How often will I see management accounts?
- As often as the agreed scope calls for. Monthly suits a practice tracking margin by income stream through the year, particularly where UDA delivery is running close to the 96% reconciliation line. Quarterly suits a steadier cycle. Reporting dates and review calls are timetabled together when the scope is set, so the date is one you have agreed rather than one you wait on.
- Do you use specific software (Xero, FreeAgent, QuickBooks)?
- Firms in our partner network work with whatever you currently use. Most dental practices run on Xero, and FreeAgent and QuickBooks are supported too. If you are still on spreadsheets, expect Xero to be recommended and the migration handled for you. The software matters less than the chart of accounts; that is what makes the dental-specific reporting possible.
- Can you support multi-site dental groups?
- Yes. Consolidated group accounts plus per-site management accounts so each principal sees their own performance. Intra-group recharges (head-office costs, central marketing, shared lab arrangements) handled correctly so each site's margin is comparable.
- What about MTD for Income Tax?
- MTD for Income Tax has applied since 6 April 2026 where qualifying income (gross trading plus property income, tested on the prior year's return) exceeds £50,000, and the threshold drops to £30,000 from 6 April 2027 and £20,000 from 6 April 2028. Most full-time unincorporated principals and associates are inside it already. Limited companies are not: MTD for Income Tax is an income tax regime, not a corporation tax one. Digital record-keeping setup and the quarterly submissions are compliance scope, so ask for them to be listed explicitly in any engagement letter, ours included.
Free scoping call
See your practice in proper detail
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Say what you are dealing with and a dental specialist takes it from there.