Managing the finances of a dental practice is just as critical as delivering excellent clinical care. Whether you’re NHS, private, or mixed, being financially savvy ensures profitability, growth, and long-term sustainability. Here’s a structured approach tailored to UK dental practice owners.

Build a solid financial foundation

a. Use professional accounting software

Choose reliable accounting platforms like QuickBooks, Xero, or FreeAgent, preferably customised for dental practices. They help track income, expenses, payroll, and HMRC compliance.

Tip: Look for systems that integrate with your practice management software (e.g., Dentally, EXACT, or SOE).

b. Work with an accountant who understands dentistry

Hire a UK-based accountant familiar with dental industry specifics (including NHS contracts, UDA values, and private fee structures). They’ll help with:

• Annual accounts.
• Tax efficiency (especially for limited companies).
• Pension planning (NHS or private schemes).
• VAT (where applicable).

Monitor your cash flow religiously

a. Track all income & expenses

Monitor income from treatments, NHS payments, and private patients. Track overheads like:

• Staff salaries.
• Lab and consumable costs.
• Rent, equipment leases, insurance.

Cash flow is the pulse of your practice. Review it weekly.

b. Maintain a cash buffer

Aim for 3–6 months’ worth of fixed costs in reserve to handle unexpected staff sickness, equipment breakdown, or seasonal downturns.

Streamline billing & collections

a. Verify payments upfront

Make it standard for reception to confirm insurance coverage, NHS eligibility, and co-payments before treatment begins.

b. Tighten payment policies

• Require 30–50% deposits for high-value treatments before booking.
• Consider finance options like Medenta or Tabeo to improve treatment uptake.
• Use automated follow-ups for overdue invoices.

Keep overheads under control

a. Audit regularly

Review your profit & loss statement monthly. Scrutinise supplier costs, utilities, and subscriptions. Don’t be afraid to negotiate better rates or switch suppliers.

b. Invest wisely

Don’t buy new equipment or software without assessing return on investment (ROI). Will it improve efficiency, quality of care, or revenue?
Apps like QuickBooks and FreeAgent can help visualise spending patterns.

Track key performance indicators (KPIs)

Monitoring KPIs enables informed decisions. Examples include:

• Hourly production per dentist/hygienist.
• Overhead % vs turnover (aim for under 60%).
• New patient numbers and retention rate.
• Average revenue per appointment.

Review KPIs monthly or quarterly with your manager or accountant.