Do you run a dental group? Are you seeking to run a much more efficient, cost-effective accounting function? We can help.
We can review your contracts thoroughly, figure out the correct employment status and help process the accounts and tax to reduce your bill.
Our specialist dental accountants are experts at helping dentists set up their accounts, manage their finances and organise their tax.
Automate your dental accounts and tax when you go digital with our specialist dental accountants.
Our approach to pricing your dental services is analytical and thorough, ensuring you price your services profitably and effectively.
Need Finance? Apply online today. Quick Application Process. Borrow at excellent rates.
These are the steps that Team Samera take with your financial needs.
We provide the full array of accountancy and tax services for Principal Dentists, Dental Associates and Dental Corporates.
Dental practice merger and acquisition decisions can be very intimidating and perplexing.
We provide support in reviewing all financial and tax records, system reviews and overall business assessments.
It can be a very daunting and complex process. It takes patience, experience and investment to ensure you have the best chance of winning an NHS Dental tender.
Our team at Samera has extensive experience in offering a whole array of tax planning for your dental business.
If your practice has invested in any R&D projects, or indeed if you plan on doing so in the near future, you may be entitled to tax relief.
Accounts for Practice Owners: How to Guide
Automate your dental practice accounts
Keeping your dental practice’s accounts organised and up-to-date isn’t always easy, and it’s certainly rarely ever fun, but it is one of the most important aspects of being a dental practice owner.
A well-kept set of accounts not only helps manage your cash flow and lower your tax bill, they will also be crucial whenever it comes to raising finance for your business.
In this guide, we’ve tried to make accounts for dental practice owners a little bit clearer.
After 20 years of experience working with dental practices and through owning dental practices myself, it is evident that across the entire industry many practices are using out-of-date procedures and technology to run their dental practice’s finances & accounting.
The days of handwriting ledgers, updating cumbersome spreadsheets, sending boxes of invoices to your accountant at the last minute before the looming submission deadlines, fortunately no longer exist!
The last few years have seen a revolution in the accountancy world. The technology has evolved to the point that much of the sending and processing of invoices can be done with simple technology systems.
Going digital with your accounts doesn’t just mean an end to endless paperwork. It also reduces the amount of manpower required to process accounts, both in the dental practice and in the accountancy office, saving both you and your accountant time, effort and money!
The importance of cloud accounting software in a dental practice
One thing we often see in common between poorly-run practices is that they have yet to embrace digital accounting and cloud software. Some practices are still relying on paper records for their accounts. Paper records are on their way out and digital accounts are the future.
We have seen many cases of missed opportunities to save tax or improve the profits of a practice. Or at best, the benefits are achieved 6 –12 months too late due to historic accounts reporting.
Typically (and back in the day) there would be a one-off meeting with your accountant after your year-end to go through the historic figures and discuss ways to improve going forward.
The problem with this is the word “historic”. By the time your accounts are finalised and you’re sitting down with your accountant, it’s often 6 months after the year-end, meaning some of the data you’re analysing could be 18 months old!
Real-time accounting is important because it brings so many benefits to a small business. It’s easier, simpler, faster, cheaper. In short, it’s just better.
Use cloud-based bookkeeping and invoice scanning software.
With the software available to you today, there is no excuse to not be automating your finances in your dental practice. To do this, you need to make sure you are using cloud accounting software, like Xero. We use Xero to run our clients’ dental practice accounts and tax.
When you rely on paper records, you waste time and effort paying invoices, sending files and documents, missing key financial trends and a real-time analysis of your accounts.
Now, however, you can simply scan your invoices into software like Hubdoc. The key information is then extracted automatically and fed into Xero, which processes and prepares the accounts.
With your bank account securely connected to the process, your dental accountant can match off any payments that you make, any income that’s coming in, and reconcile the bank account quickly. All without waiting for paper records to be sent anywhere.
Instead of having to keep hardcopy records of all your invoices, receipts and documents, storing them and then shipping them off to your accountant when needed, all you need is a smartphone or scanner!
Simply take a photo of your receipts, invoices etc. via the cloud accounting app, or scan the documents with a scanner, and send them off via the app or email.
All your invoices are also stored in Xero too, so trying to find an old invoice is easy as they all reside in the Cloud, accessible 24/7 from anywhere with an internet connection.
Another benefit of digital accounts is that you can also make payments directly from your cloud accounting software like Xero. Instead of paying each individual invoice separately, which is time-consuming, you can tick all the invoices you want to pay and make one single payment to all suppliers you choose.
This means you can process and prepare your dental practice management accounts much quicker and easier, which means the annual accounts are easier and quicker to prepare. All of this can really help you spot cash flow problems sooner and organise your tax calculations and payments.
Simply put, when you automate your dental practice accounts and finances, you save yourself time, effort and money.
Share and collaborate with your dental accountant.
By having everything available on the cloud, what you see on the cloud is also what your accountant sees too, allowing your accountant to see real-time information on your practice’s (or your personal) expenses, finances and accounts.
Most accountants will be able to provide advice on tactics and strategies to improve your practices finances, and this is far easier with a clear, instant view of your accounts.
Sharing your accounts and finances digitally with your accountant allows them a much clearer picture of the financial health of your business, which in turn helps you to collaborate more effectively with either them or any other financial advisors.
With constant updates and real-time data, you and your accountant will be able to analyse trends, manage cash flow and identify potential issues far earlier than with old-fashioned hardcopy accounts.
The technology allows you to collaborate and work together to improve the value of your dental practice performance easier than ever before.
You can use cloud-based software from any device with an internet connection. Online accounting means small business owners stay connected to their data and their accountants. The software can integrate with a whole ecosystem of add-ons. It’s scalable, cost effective and easy to use.
Anyone in your business that needs it can have access at any time. You can restrict and retain far more control over who has access to your personal information.
Monitoring and improving key performance areas
Software packages such as Xero allow you to automatically run a variety of financial reports for you to analyse over a whole variety of time periods.
For instance, most cloud accounting software packages allow you to run reports such as Profit and Loss, Balance Sheets and Cashflow Reports. You can also create your own templates for reports so that you can see the exact data and trends you want.
These reports make it far easier to keep track of your accounts and finances by doing a lot of the leg-work for you. Instead of wasting your time and effort poring over an entire month’s invoices to spot trends, simply run your favourite saved report and see the data instantly.
We advise clients to run such reports at least quarterly so they can assess and routinely judge and keep up with the performance of their dental practice.
This used to be an area that only large businesses with internal accounting teams could tap into. Nowadays, however, with the help of real-time accounting, any sized business can have access to this data to monitor and improve their practice performance.
If you want to make good decisions, you need to base those decisions on good and timely information. Without such information, changes that you make in your business will be more like wild guesses than informed decisions.
Knowing and understanding the key numbers in your business helps you and your advisors to spot trends and take appropriate action to improve your business’s performance. Your accountant can then spend time really adding value to your business, providing you with better advice and alerting you when things go wrong.
Save money in your dental practice with cloud accounting
We had a client who was paying £450 a month for 3 days of bookkeeping (using manual keystrokes and traditional software). With the implementation of Xero (our preferred Cloud Accounting platform), this was reduced to half of that for a day, saving £4,500 for the year.
The point here is, there is amazing technology available to automate the majority of this necessary evil work. If you are not utilising this, you are basically throwing your money away.
In order to have a business that is operating to its best potential, accounting information needs to be in real-time and your accountant should be able to access this at any point. Not 6-18 months after the event, when it is often too late.
We saw another client recently who saved a whopping £200,000 in tax, simply through having up-to-date information that we had access to!
Work smarter with accessible data in the cloud
The beauty of this software is the flexibility it gives you to run your business from work, home, or on the go. You can be confident that you have an up-to-date picture of how your business is doing, no matter where you are.
Software updates can be developed and delivered faster and more easily in the cloud. This means you don’t need to worry about installing the latest version and you’ll get access to new features instantly. With cloud accounting software, you have the option to run your business remotely, from anywhere in the world. And when data is fluid and accessible, the possibilities are endless.
Make quality decisions
With the technology available to small businesses today, there is absolutely no excuse to be using out-of-date, old fashioned accounting systems. You could be running a far more efficient and profitable dental practice simply by doing digital with your accounts!
By switching to digital cloud accounting software, by using the online functionality to share and collaborate with your accountants and financial advisors and by using the automatically-generated reports, you can ensure that you make better, quicker, more informed decisions to continually improve the efficiency and profitability of your practice.
By looking at the performance detailed in the reports you can identify and interpret areas that need changing in your dental practice, whether it means cutting costs, increasing fees, or increasing marketing activity.
Understanding the management reports can only help you run a more efficient and successful dental practice.
Traditional software problems
Small business accounting software that’s not available via the cloud can be tedious.
Traditionally, it can suck up far too much of your business’s time and effort. This doesn’t add value, and takes the fun out of being in business. Cloud software can save your company time and money.
- The data in the system isn’t up-to-date and neither is the software. This means events such as changes in regulations cannot be reacted to in a timely manner and the benefits of adopting changes are 6-12 months delayed (or too late!).
- It only works on one computer and data bounces from place to place. For example, on a USB drive. This is not secure or reliable.
- Only one person has user access. Key people can’t access financial and customer details.
- It’s costly and complicated to keep backups (if done at all).
- It’s expensive, difficult and time consuming to upgrade the software.
- Customer support is expensive and slow
Security and Business Continuity
As a small business owner, you might be concerned about a cloud service provider storing your data. But the cloud is one of the most secure ways to store information. For example, using cloud software, if your laptop is stolen, no one can access your data unless they have a login to the online account. With cloud software, this is where the data lives –as opposed to on your hard drive.
In the event of a natural disaster or fire, being in the cloud means business productivity doesn’t need to be affected because there’s no downtime. All of your information is safely and securely stored off site. As long as you have access to any computer or mobile device connected to the internet, you’re back up and running.
In addition to this, if you invite users to view your data, you can control the level of access. This is much more secure than the old-fashioned way of emailing your files or sending out a USB stick with your data on it.
Cloud-based software companies ensure that the security and privacy of data about you and your organisation is always airtight. If you use online banking, then you’re already primed to use cloud accounting. Cloud security is world class
10 Things All Good Accountants For Dentists Have
You may be wondering why you need to hire a specialist dental accountant at all – surely any reputable professional accountant will be able to help a dentist? The fact is that dentists need an accountant who has specific knowledge of the legal and financial implications of owning a dental practice and/or practising as a dentist.
It’s vital that you hire an accountant who has significant expertise in the area of dental accountancy. Only an accountant who has this expertise can optimise your financial and tax position. However, simply having experience as an accountant for dentists does not make that accountant a good choice for you and your practice. There are several factors that you need to consider when choosing a dental accountant.
These are the 10 things we think all good dental accountants need.
Level of competence in the dental finance and tax arena
This is a consideration that is paramount. You need to make sure that your tax position is optimised. This is why it’s so important for the dental accountants you hire to have extensive knowledge of the tax rules that govern the dental industry, and how to use this knowledge to make sure you get the best possible outcome.
In addition to this tax knowledge, any dental accountant you hire needs to have experience of handling the complexities of finance in the dental industry.
Not all industries are the same. Being a great accountant in one sphere doesn’t necessarily translate into a great dental accountant. A great dental accountant has a wealth of knowledge and experience in the market.
Range of services available
You want your relationship with your dental accountant to be as productive as possible. For this reason, it’s useful if the dental accountants you choose can provide a range of different services. The services that you may require include:
- Dental practice payroll services
- Dental industry compliance assistance
- Corporate and personal tax returns
- Help with NHS tenders
- Helping with raising finance
- Tax advice and planning
It’s easier to deal with the same provider for all of this help, so choosing a dental accountant who offers a range of services makes sense.
Level of communication skills
There is little point in receiving advice about your tax and financial position if you do not understand it. Your dental accountant needs to be able to explain advice and information to you in a way that you can easily understand, so they need to have highly developed communication skills.
You need to have a defined and dedicated point of contact on whom you can rely at all times.
Effectiveness of planning
Financial and tax planning is one of the most important aspects of running a successful dental practice. If this planning is not in place, you could end up with a large tax bill that comes as a nasty surprise!
You need to be able to rely on the accountant you hire to help with your budgeting and planning, so they need to be able to demonstrate this attribute.
Level of accessibility and responsiveness
You need to be able to get information and support from your accountant quickly and easily. Your dental accountant should always have the same day or next day service for responding to clients’ queries.
It’s also useful to look out for special arrangements made that take into account clients’ availability and provide access to out of hours support. Our team are happy to discuss clients needs after hours as long as it has been pre-arranged.
Value for money
Choosing the best dental accountant for your practice does not mean choosing the lowest cost option – after all, cheapest rarely means best! You need to take into account factors such as experience, reputation and services provided when establishing which dental accountant provides you with the best value for money.
The last thing you want to do is be attracted by a great price, only to find that the accountants you have chosen are out of their depth, should you ever decide to take a major step such as buying or selling a dental practice!
Reputation and proven performance
Research is an important part of any decision you make regarding the hiring of a dental accountant. Look for any success stories that an accountant has. These stories can help to show you how the dental accountant you choose can help your business to be successful. You should also look for independent reviews of accountants before you make your final choice.
Ethos and principles
It’s vital that any dental accountant displays an ethos and principles that are aligned with helping you and your business to succeed. Important principles include:
- Provision of clear and accurate advice.
- Guarantee of up to date industry knowledge.
- Easy contact facilities.
- Honest and approachable manner.
Make sure that you are fully aware of the ethos and principles of the dental accountants that you hire.
Clarity of fees
You need to understand what the cost of your dental accountant’s services will be. These costs should be detailed upfront, so that you do not have any nasty surprises down the line. Make sure that the accountants you hire have a fully transparent pricing schedule and that they are happy to discuss costs for their services from the start.
Experience with dental practice purchases and sales
There may come a time when you are looking to acquire new or further premises, or when you want to sell your dental practice. This may not be the case when you first hire a dental accountant, but you have to be prepared for needs that you may have in the future. This is why it’s so vital to make sure that the professionals you choose have experience in successful dental practices purchases and sales.
Choosing a dental accountant is not a task that should be undertaken lightly. You need to make sure that you do not regret the decision that you make. The factors mentioned in this article should play an important role in your decision making process. The dental accountant you hire should be able to provide a range of services and be available when you need them. They should provide you with excellent value for money and their pricing structure should be transparent.
At Samera, we recognise the importance of a valuable relationship with our customers. We put our years of experience and expertise to use providing a range of vital dental accountant services to clients. Contact us about the dental accountant services we can provide for your dental practice.
Accounts for Dental Associates: How to Guide
Specialist Dental Accountants for Associates
Samera Dental Accountants work with hundreds of Dental Associates throughout the UK, providing the full range of accountancy and tax services.
We have been specialising in dental accounts for nearly 20 years and we understand the issues facing the nation’s dental associates.
If you want to save money on your tax by ensuring you only pay exactly the amount you need to and, therefore, improve your cash position – contact us today.
Our dental accounts process is quick, easy and simple. All you need to do is take a picture of your receipts on your phone, send that over to us and we will handle everything else.
There’s no need for mountains of paperwork. There’s no need to send us boxes of forms and receipts. All you need is a phone.
When you sign up with our Dental Accounts and Tax for Associates package, you will receive:
- Annual preparation and submission of your accounts and tax return
- Expert advice to reduce your tax bill
- Support from a friendly knowledgeable team
- Free Xero Account
- Free Hubdoc – AI (Artificial Intelligence) receipt scanning account
Our team are experts when it comes to accounts and taxes for dentists – we know the industry inside and out. We will lower your tax bill by ensuring you only pay exactly what you have to and advise you on how to improve your cash position.
Contact us today for a free, no obligation consultation and find out how much we can save you on your tax bill.
Dental Associate Accounts And Tax Explained
Running your dental accounts can often feel like the most dreaded and tedious aspect of the job. However, properly organised accounts are not just important for managing the cash flow and handling your tax bill. Many don’t realise that your accounts will be key any time you try to raise finance for any dental business you start.
In this guide, we’ve tried to make accounts for dentists a little more simple.
It can be easy to fall into the trap of thinking that only practice owners need to really worry about their accounts. As long as your tax bill is kept low and your money keeps moving, that’s all that matters right? Wrong. If you decide to start a dental practice of your own, or indeed if you ever try to raise a business loan, your dental accounts and financial records are going to be crucial.
You will most likely be able to produce a set of accounts without expert help. However, it is almost essential to engage a specialist dental accountant like Samera to go through your accounts with you, should you wish to raise finance.
Profit And Loss Accounts
Your profit and loss accounts will show your turnover for each of the last 2 years, usually generated by your service sales.
You will then list your cost of sales, such as materials.
Underneath this, you will need to list your expenditures. Here is a list of the kind of costs you will need to include here:
- Protective clothing
- Travel expenses
- Use of Private residence
- Vehicle running costs
- Professional indemnity insurance
- Printing, postage and stationery
- Telecommunications and data
- Accountancy fees
- Professional subscriptions
- Charitable donations
You will then subtract these expenses from your gross profit. This will give you your net profit for the year.
The balance sheet is also a key document and represents the financial health of your business. The profit and loss sheet shows you the financial situation for that year alone.
The balance sheet, on the other hand, includes all of your assets and liabilities. Assets are split into current and fixed assets.
Typically for dental associate accounts, current assets will include your bank accounts and any money owed to you. Current assets are assets which can be expected to be sold or consumed within that fiscal year.
Fixed assets are tangible assets, such as loupes and their costs are included on the balance sheet and not the profit and loss sheet. This is because they are an asset of the business which you will theoretically use for many years, not as a one-off material within the fiscal year. The value will be depreciated across the period of its estimated useable life.
Liabilities are people or entities that you or the business owe money to.
Underneath your assets and liabilities, you need to list your Net Current Assets (subtract your total liabilities from your current assets), Total Assets Less Current Liabilities and Net Assets (current + fixed assets).
Balancing this all out is the Capital Account, which is where the accounts owner comes in. Here, you list your brought-forward profits from the previous year. You then list your new net profit for the year just ended. Then, off-setting all of that is what the owner has drawn for personal use, the money they’ve spent.
So, your brought-forward profits plus current year profits, minus drawings gives you your remaining cash reserves. This will also equal your assets minus liabilities (Net Assets).
In most cases, a financially healthy business will have a positive balance sheet.
You will also need to include a separate record of each of the assets, such as the loupes.
Tax For Dental Associates Explained
Once you have properly organised your accounts, it’s time for the tax man to get involved.
On your tax calculation record, you’ll need to include your income received (before tax is taken off). This will typically include your profit from self-employment (as an associate dentist), which you calculated on the profit and loss sheet, as well as interest received from your bank accounts (even if it is only a couple of pounds). This gives the Total Income Received.
You then take away from this figure your pension contributions and your personal tax allowance. The remaining figure is your taxable profit.
You will then list out your tax payments categorised by the tax band you need to pay, how much at the basic rate, how much at the higher rate and any additional rate. You will also need to list any taxable interest payments you have received.
You will also need to report your National Insurance payments, which have different threshold bands. This will give you your total National Insurance liability.
Adding these figures (Income Tax Charged and National Insurance liabilities) together gives you your total income tax.
You should find that this figure is around 25% of your profit. This is why we recommend to our clients that they set aside 25% of their income to cover their tax bill.
Paying The Tax
The next document you need to draw up will be the tax payment summary.
First, list your total tax payments due, which you calculated on the tax report. You will then minus any previous tax payments you have made for that year, as well as any deductions such as previous overpayments and rebates.
The resulting figure is the tax you currently owe for the financial year.
Remember, if your tax bill is over £1,000 you will need to make advance payments on next year’s tax bill, based on this year’s tax bill. You will be required to pay 50% of the total tax due in January and the remaining 50% in July.
So, your total tax bill due on 31st January will be the tax you currently owe, plus your first advance payment on next year’s tax.
How To Use Xero For Dental Associate Accounts
In this webinar, Arun and Nathan discuss using Xero for dental associate accounts and tax returns. Xero is a great way to make your dental accounts easier, quicker and simpler – we use it with all of our clients.
What Dentists Can Claim On Expenses
As a dentist you can only claim on expenses items which have been purchased for business purposes, the items you use for dentistry.
While you may be tempted to try and put everything through the books, this can quite often end you up in trouble with HMRC. That’s why the Samera team have put together a Dental Associates Expenses Guide.
So when it comes to preparing your annual tax return, a degree of good judgement needs to be used to assess whether something is allowable for tax purposes.
Travel from home to practice is a big no no, however, if you travel between practices on a regular basis and keep records to support such journey costs, then this is allowable for tax purposes. Mileage records must be maintained – HMRC just love to investigate such mileage claims and then find that there are not any!
If you use a computer for your business, then some or even all of the capital cost could be claimed on your behalf.
New loupes, or other new kit? Then potentially this can also be claimed for.
Good Judgement is Essential
In respect of training, if you are building on existing knowledge, then this is usually deemed to provide you with CPD, which can then be claimed for. However, brand new knowledge is usually not deemed to be allowable, so again some judgement needs to be used on this aspect.
The Samera Dental Associates Expenses Guide
We have listed below common key expenses you can claim for in your self assessment tax return.
- Travel for business purposes at 45p/mile, and this includes travel to any courses or visiting accountants etc. We would suggest keeping a diary of business travel through the year so that you don’t have to do all of this at once at the year end. You cannot claim mileage to a regular place of work but can claim for travel to other dental practices where this is irregular
- Alternatively, you may put the cost of your car through your business, along with the costs of repairs, MOTs, servicing and fuel receipts. However, we would be required to remove the non-business usage proportion of these costs. For example, if you estimate that you have used your vehicle for 20% business use and 80% private use, then we would disallow 80% of these costs. The 20% that has been claimed may still be more than the alternative option of claiming mileage at 45p/mile.
Click to read about buying a car through a limited company.
- Any other business travel costs such as trains/taxis etc.
- Training and Course costs that are to ‘update pre-existing knowledge’, such as annual update courses etc. Course costs that enhance your technical knowledge cannot be claimed as a business expense. You have to tread carefully here as we have seen clients get into trouble with HMRC on this aspect.
- Subscriptions to the BDA, GDC etc.
- Professional indemnity insurance
- Legal advice relating to business matters
- Cleaning/laundry costs
- Printing, postage and stationery for business purposes
- Any dental materials purchased
- Accountancy costs!
- Any website or marketing costs you might incur
- A proportion of your telephone bills relating to business use
- A proportion of your home bills due to having an office at home to administer your business and put accounts records together (the HMRC flat rate is £4/week but this may be more depending on evidence provided)
- Loupes or other equipment that you will use for the purpose of your business
- Cost of study texts that you previously purchased as you will refer to these for the purpose of your business
- In addition, your business could ‘buy’ from you the cost of your personal laptop and printer that you use to administer the business if you have these
The above list isn’t ‘exhaustive’ so please feel free to ask if there is an expense that you have paid and are unsure whether you can claim. There is no additional fee for asking about these.
To find out more, check out our Learning Centre, full of articles and webinars covering accounts, tax and finances for dental practices.
For everything you need to know about accounts and tax for dentists, have a look at our accounts and tax for dentists webinars and articles here.