Buying a Dental Practice UK

Buying a Dental Practice UK: A Complete Guide 

Buying a Dental Practice in the UK is more than just a financial transaction—it’s a major career milestone. To make the process smooth and successful, you need to start by drafting your acquisition roadmap—a step-by-step plan that takes you from the initial idea to full ownership. Along the way, conducting a thorough valuation and due diligence ensures you know exactly what you’re buying, from financial performance to legal obligations. Equally important is having a financial strategy that allows you to plan smart and borrow wisely, so you can secure the right funding and build a sustainable future for your practice. 

Drafting Your Acquisition Roadmap: From Idea to Ownership - Step by Step guide to Buying a Dental Practice UK

Valuation and Due Diligence: Know What You’re Really Buying 

Financial Strategy: Plan Smart, Borrow Wisely 

 Let’s break down on how to get from Idea to Ownership — step by step guide . 

Step 1: Start With Your Vision 

Before you look at property listings or meet with sellers, write down a complete business plan and  get clear on what you want. 

Ask yourself: 

• Do I want an NHS, private, or mixed practice? 

• What kind of location fits me best — urban, suburban, or rural? 

• How much income do I want to generate in my first 1–3 years? 

  
  

PKPI Tip: Be honest about your clinical strengths and leadership style. A practice that matches your values and personality will thrive in the long run. 

Step 2: Secure Your Financing Early 

Before making offers, you’ll need to get your financing in order. Most banks will want to see: 

• Clean personal and business finances 

• A 10–20% deposit 

• A clear plan for repayment 

  
  

Lenders often fund up to 70–95% of the goodwill value, especially if backed by property equity. They’ll also look closely at your EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortisation) to assess profitability and repayment strength. 

What to prepare: 

• Your professional CV 

• 3–5 years of P&L, balance sheets, and cash flow 

• Payroll reports and lease details 

• A formal valuation of goodwill, equipment, and intangible assets 

Step 3: Find the Right Practice 

Now comes the exciting part ,finding the practice that fits your goals. 

Work with a dental broker or trusted advisor like PKPI Chartered Accountants who can help evaluate: 

• Patient base and type 

• Profitability (EBITDA) 

• Lease or freehold agreements 

• Staff contracts and culture fit 

  
  

PKPI Insight: Numbers matter, but don’t ignore the human side — patient loyalty, local reputation, and staff retention are priceless. 

Step 4: Do Your Due Diligence 

This is your chance to double-check everything before signing. Due diligence protects you from post-sale surprises. 

Review: 

• Financials from the last 3–5 years 

• NHS contract performance and UDA targets 

• Staff contracts and employment liabilities 

• Lease agreements or property title 

• Equipment and service agreements 

• CQC and GDPR compliance 

PKPI Chartered Accountants Reminder: Skipping due diligence can lead to hidden debts, faulty equipment, or lease issues that cost you later. 

Step 5: Legal & Regulatory Compliance 

Once you’ve agreed to buy, you’ll need legal guidance to make it official. 

You’ll need: 

• A dental solicitor to handle share/asset transfer 

• TUPE compliance for existing staff 

• Coordination with the NHS Area Team (if applicable) 

• Help with CQC registration — which alone can take 8–12 weeks 

Your legal team makes sure the transfer is smooth, compliant, and risk-free. 

Step 6: Plan the Handover & Integration 

With contracts signed, now it’s about making sure the transition goes smoothly for the team and your patients. 

 Key steps: 

• Confirm completion date 

• Communicate clearly with staff and patients 

• Transfer payroll and practice software 

• Meet the team and retain key staff 

• Track KPIs and patient retention over the first year 

Work With Experts – It Matters 

Buying a dental practice involves legal, financial, and operational layers. The right team can save you time, money, and stress. 

Your support team should include: 

• A dental broker 

• A dental accountant (like PKPI Chartered Accountants) 

• A finance broker or lender 

• A solicitor experienced in dental transactions 

• A CQC compliance advisor 

Common Pitfalls to Avoid 

Overestimating goodwill — inflated EBITDA can fool lenders 

Rushing due diligence — hidden liabilities appear later 

Ignoring lease terms — short leases = uncertainty 

Using general advisors — dental-specific experts are key 

Buying a Dental Practice in the UK is a big step — not just financially, but professionally. With the right planning and expert support, it can be the most rewarding move of your career. 

By following a well-defined acquisition roadmap, you’ll replace guesswork with confidence. With insights from PKPI Chartered Accountants, Lloyds Bank, and other trusted partners, you’ll be fully equipped to make smart decisions from day one. 

Thinking of buying your own practice? Start strong, plan well, and let the experts guide your journey to ownership. Before finalising the purchase, it’s crucial to conduct Valuation and Due Diligence—essential steps that help you know what you’re really buying, avoid overpaying, identify hidden risks, and ensure the practice is truly profitable for the long term. 

 

 Valuation and Due Diligence: Know What You’re Really Buying 

Before finalising the purchase of a dental practice, it’s critical to accurately value the business and conduct due diligence. These steps protect you from overpaying, uncover hidden issues, and give you clarity on future profitability. 

What Is a Dental Practice Valuation? 

A professional valuation assesses the goodwill, assets, patient base, location, and financial performance of the practice. Lenders will often use this valuation to determine how much they’re willing to finance. 

Key components of valuation include: 

• Goodwill: The value of the brand, patient loyalty, and ongoing business potential 

• Equipment & Assets: Dental chairs, X-ray machines, IT systems, etc. 

• Financial History: Revenue, EBITDA (earnings before interest, tax, depreciation, and amortisation), and growth trends 

• Location & Lease Terms: Prime areas command higher valuations 

Valuation methods may include: 

• Multiple of EBITDA (commonly 4x–7x) 

• Percentage of Turnover 

• Discounted Cash Flow (for more complex cases) 

What Does Due Diligence Involve? 

Due diligence is your opportunity to examine everything behind the scenes before signing the purchase agreement. It helps verify that the business is accurately represented by the seller. 

Key areas to assess: 

1. Financial Due Diligence 

• 3–5 years of financial statements 

• NHS/private income split 

• Staff costs and associate fees 

• Any outstanding debts or liabilities 

2. Operational Due Diligence 

• Patient list size and recall rates 

• UDA (Units of Dental Activity) performance if NHS 

• Staff contracts and roles 

• IT systems and compliance processes 

3. Legal Due Diligence 

• Ownership structure and any litigation history 

• CQC registration status 

• Property lease terms or freehold documentation 

• Associate and employee contracts 

 Why It Matters 

Skipping valuation and due diligence could mean: 

• Overpaying for goodwill 

• Inheriting unresolved tax issues or staff disputes 

• Buying a practice with hidden performance problems 

• Struggling with unexpected compliance risks 

Working with dental specialists—like solicitors, accountants, and brokers—ensures you know exactly what you’re buying and that it’s a business with strong foundations for future growth. Equally important is your Financial Strategy: Plan Smart, Borrow Wisely—a carefully crafted plan that helps secure the right funding and lays the groundwork for long-term profitability and sustainable success. 

Financial Strategy: Plan Smart, Borrow Wisely 

A well-thought-out financial strategy is the backbone of a successful dental practice acquisition. It not only helps you secure funding but also ensures long-term profitability and sustainable growth after purchase. 

 1. Know Your Funding Options 

    Lenders typically offer 70–95% loan-to-value (LTV) for the goodwill portion of the business.     The exact percentage depends on: 

• Your professional track record 

• The practice’s profit history 

• Available security (e.g. property or savings) 

  
  

Sources of finance: 

• High street banks (e.g. Lloyds, Barclays) with dental-specific loan products 

• Specialist healthcare lenders (PKPI Chartered Accountants) 

• Personal savings or equity from property 

• Family investment or business partners 

Tip: A strong business plan with solid financial forecasts improves your loan approval odds. 

2. Build a 3-Year Financial Forecast 

Lenders and advisors will expect to see: 

• Projected revenue and EBITDA 

• Break-even analysis 

• Cash flow forecasting 

• Expected loan repayments vs profit 

Your forecast should reflect realistic assumptions based on: 

• Existing patient base and growth potential 

• NHS/private mix (and UDA performance if applicable) 

• Costs of operations, staff, materials, and marketing 

  
  

3. Plan for Upfront and Ongoing Costs 

Upfront Costs: 

• 10–30% deposit 

• Legal, broker, and due diligence fees 

• CQC application and regulatory fees 

• Fit-out or refurbishment (if needed) 

Ongoing Costs: 

• Monthly loan repayments 

• Salaries and associate fees 

• Equipment maintenance 

• Marketing and software subscriptions 

Don’t forget: Keep a cash reserve for emergencies or slow months.

4. Optimism Tax and Profitability 

• Structure your purchase tax-efficiently (asset vs share sale) 

• Work with a Dental Accountant (PKPI Chartered Accountants) to set up your business as a limited company 

• Make the most of capital allowances on equipment 

• Register for VAT if applicable and keep accurate bookkeeping from day one 

Final Advice 

A strong financial strategy isn’t just about securing a loan — it’s about planning for the future. With smart forecasting, efficient cost management, and expert advice, you can confidently step into ownership knowing your finances are under control. 

Frequently Asked Questions (FAQs) 

1. Is now a good time to buy a Dental Practice in the UK? 

Yes, demand for dental services is rising post-pandemic, and lenders are actively supporting healthcare businesses. However, success depends on choosing the right location, practice model, and financial structure. 

2. What’s the difference between buying an NHS, private, or mixed practice? 

• NHS practices provide income stability through government contracts. 

• Private practices offer higher profit margins but rely on patient retention and service quality. 

• Mixed practices balance both, offering diversified revenue streams. 

3. How is a Dental Practice valued? 

Valuation is typically based on EBITDA multiples, goodwill, asset value, and location. Other factors include patient base, brand reputation, and NHS UDA contracts (if applicable). 

4. What should I look for when viewing a Dental Practice? 

Focus on patient flow, staff interactions, equipment condition, location accessibility, and the layout’s capacity for expansion or upgrades. 

6. Can I keep the existing team after buying the practice? 

Yes, under TUPE regulations, employees’ contracts transfer to the new owner. It’s crucial to review and understand all staff terms during due diligence. 

7.  How Long Dental Practice Take? 

Purchase timelines vary, often taking 4–6 months (or longer), depending on: 

CQC Registration (can take 8–12 weeks) 

CQC stands for Care Quality Commission in the UK. In dental practices, the CQC is the independent regulator of health and social care services in England. It ensures that dental providers meet national standards of quality and safety. If you’re buying or setting up a dental practice in the UK, CQC compliance is a critical part of the process. 

Other key steps include finalising funding, and arranging property and lease agreements. 

To streamline the process and avoid delays, it’s best to engage early with experienced advisors like PKPI Chartered Accountants. 

PKPI Chartered Accountants help narrow down your options based on these criteria .

8. What are the hidden costs I should prepare for? 

Aside from the purchase price, expect legal fees, valuation charges, CQC costs, refurbishment, IT upgrades, and working capital for the first few months. 

9. Should I buy the freehold or lease the property? 

Buying the freehold gives long-term control and asset value, but leasing offers lower upfront costs and flexibility. Always consult a solicitor to assess lease terms if leasing.

10. What’s better: buying an existing practice or starting a new one? 

Buying gives you an established patient base, cash flow, and brand. Starting from scratch offers flexibility but requires more investment in marketing and time to become profitable. 

11. How can I increase the value of the Dental Practice after purchase? 

Focus on improving patient retention, adding private services, optimising operations, training staff, and implementing digital tools for marketing and admin. 

12. Can I own multiple practices as a first-time Dental Practice buyer? 

It’s recommended to focus on successfully managing one before expanding. However, experienced buyers with strong financial backing can acquire multiple units with the right strategy. 

13. Is it possible to negotiate the asking price of a Dental Practice? 

Yes. After due diligence, you can negotiate based on findings like underperformance, outdated equipment, or lease conditions. Brokers can assist in this negotiation. 

14. What happens to existing patient care plans during the handover? 

Care plans (like Denplan or Practice Plan) usually continue under new ownership, but you must notify providers and ensure proper contractual and system transitions. 

15. Do I need to notify patients about the ownership change? 

Yes. It’s best to communicate the transition with reassurance. Keeping the same clinical team and ensuring service continuity helps retain patient trust and loyalty. 

16. What support does PKPI or other professional service firms offer buyers? 

Specialist firms like PKPI Chartered Accountants offer full support from business planning, tax advice, and finance setup to legal structuring, helping buyers manage the entire acquisition process seamlessly. 

Ready to take the next step?

Let PKPI Chartered Accountants guide you through every stage of buying your dental practice in the UK—from valuation to handover.

👉 Book your free consultation today!