From a single mixed practice to a growing group: consolidated accounts, per-site performance, payroll across the team, and deal support when you add the next practice.
Once you own more than one practice — or one large one — the questions change: which site actually makes money, where staff costs are drifting, whether the group structure still fits, how to fund the next acquisition without straining the last one. We act as the finance function for practices and small groups: the compliance handled everywhere, and the numbers organised so decisions get easier as you grow, not harder.
One consolidated profit figure across three practices tells you almost nothing you can act on. The question that matters is which site earns it — and that needs consistent cost allocation. The practice manager's time split by where it is genuinely spent. Group marketing apportioned by where the patients actually came from, not by headcount. Central finance and admin cost pushed back out to the sites that generate it. Do that once and the answer is usually uncomfortable: in most small groups we take on, one site is subsidising another, and the owner had a different site in mind.
Then benchmark. Employed team cost as a percentage of fee income, tracked separately from associate cost — combined, the two move for reasons that have nothing to do with efficiency, because a quarter where an associate bills more makes the ratio look worse when nothing has gone wrong. Lab and materials by site. Surgery utilisation. Our benchmarks guide sets out the ratios we use and the ranges we see across a dental-only client base.
This is the one that costs real money, and it is almost never raised before the structure gets built.
Corporation tax is 19% on profits up to £50,000 and 25% on profits above £250,000, with marginal relief in between. But those two limits are divided by the number of associated companies — companies under common control, counting the company itself. Own three practice companies and each one gets a third of the limits: £16,667 and £83,333 instead of £50,000 and £250,000.
An illustrative group of three trading companies under common ownership in 2026/27:
That is £5,710 a year of corporation tax created purely by holding three practices in three companies rather than one.
Now add the employment allowance. It is worth up to £10,500 against employer National Insurance in 2026/27 — but only one company in a group of connected companies may claim it. Three separate, unconnected practices would each claim £10,500. The same three inside a group claim it once. That is a further £21,000 gone.
So the structure costs roughly £26,710 a year before it has delivered a single benefit. That is not an argument against groups — the risk ring-fencing, funding and disposal advantages are real, and for most owners they win comfortably. It is an argument for knowing the number, pricing it into the acquisition model, and structuring deliberately rather than by accident. One detail worth having: a holding company that holds nothing but shares in its 51% subsidiaries and passes any dividends straight through to shareholders is normally left out of the associated company count, so a genuinely passive holdco does not make the arithmetic worse.
April 2026 moved the numbers again. Employer National Insurance is 15% on earnings above a £5,000 secondary threshold. The National Living Wage rose on 1 April 2026 from £12.21 to £12.71 for those aged 21 and over, from £10.00 to £10.85 for 18 to 20 year olds, and from £7.55 to £8.00 for under-18s and apprentices. On a twelve-person practice payroll of £252,000, the April 2026 rises alone add roughly £9,400 once employer National Insurance and pension are counted — a little over one percentage point on the staff-cost ratio, at every site.
Budget about 14% on top of gross pay for staff in a workplace pension. Staff in the NHS Pension Scheme cost considerably more: the employer contribution is 23.7% of pensionable pay plus a 0.08% administration levy. Across a group those percentages compound quickly, and inconsistent treatment of hygienists and therapists between sites is the most common exposure we find on taking a group on. Our staff costs article works through the numbers, and the engagement guide covers the self-employed question properly.
Buy-and-build is a process problem before it is a finance problem. What makes the fifth deal easier than the first is a standard appraisal pack, the same due diligence questions asked every time, and a lender relationship that already knows how you behave against a covenant. On the diligence side the recurring findings in dental deals are consistent: UDA delivery and the clawback exposure that comes with it, associate agreements that were never signed, plan patient liabilities that transfer with the practice, and personal spend running through the accounts that has to come back out before EBITDA means anything at all.
Our buying guide covers the process end to end, the UDA clawback article covers the trap that most often reprices a deal after heads of terms, and valuation explains what a buyer does to your EBITDA. From completion day, each new practice's numbers go into group reporting on the same basis as the rest — which is the only way per-site comparison stays meaningful as you grow.
Business Asset Disposal Relief is 18% on qualifying gains disposed of from 6 April 2026 — up from 14% for disposals between 6 April 2025 and 5 April 2026, and 10% on or before 5 April 2025 — against a £1 million lifetime limit. For a group owner with several practices, £1 million of lifetime relief spread across multiple disposals is a planning constraint rather than a footnote, and it interacts directly with how the group was structured years earlier. Which is why the structure conversation belongs at practice two, not practice five.
Usually around the second practice. A holding company can ring-fence trading risk, make funding cleaner and make future acquisitions and disposals simpler — and it is far easier to put in place before the group grows around it than to retrofit later, because a restructure once three practices are trading raises stamp duty and capital gains questions that did not exist at practice two. The point to understand first is cost: separate trading companies divide the corporation tax limits between them and share a single employment allowance. A holding company that only holds shares in its 51% subsidiaries and passes dividends straight through is normally excluded from the associated company count.
Per-site accounts with consistent cost allocation, benchmarked quarterly. The group total hides everything, and the allocation is where it is won or lost: the practice manager's time split by where it is genuinely spent, central marketing apportioned by where the patients came from, admin and finance cost pushed back out to the sites that generate it. Then compare employed team cost and associate cost as separate percentages of fee income, plus lab and materials, plus surgery utilisation. In most small groups we take on, one site subsidises another — and the owner had a different site in mind before the numbers were split honestly.
The corporation tax limits of £50,000 and £250,000 are divided by the number of companies under common control, including the company itself. Three practice companies each get £16,667 and £83,333, so profits that would have paid 19% pay marginal-relief rates instead, and profits already in marginal relief pay the full 25%. On a group of three companies making £180,000, £96,000 and £48,000, that is about £5,710 a year of extra corporation tax. Add the employment allowance restriction — one £10,500 claim across the whole group instead of one each — and the structure costs roughly £26,710 a year before any of its benefits.
No. The employment allowance is worth up to £10,500 against employer secondary Class 1 National Insurance in 2026/27, but where companies are connected, only one company in the group may claim it. Three separate, unconnected practices would each claim £10,500; the same three inside a group claim it once, so £21,000 of allowance disappears the day common control exists. It is claimed through payroll on the Employer Payment Summary, which is why groups sometimes claim it in more than one company by accident and have to unwind it. Make sure the company claiming is the one with the largest employer National Insurance bill.
Yes — it is the core of our practice deals work. In practice that means a repeatable appraisal pack so target three is assessed the same way as target one, due diligence that asks the dental questions rather than the generic ones, lender introductions from people who already know how you behave against a covenant, and each acquired practice folded into group reporting on the same basis from completion day. The recurring diligence findings are consistent: UDA delivery and clawback exposure, unsigned associate agreements, plan patient liabilities transferring with the practice, and personal spend that has to come out before EBITDA means anything.
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