Dental Tribune UK Edition, October 11-17, 2010, No.25 Vol.4

M ost dentists are not primarily business people, so it’s not sur- prising that since the General Dental Council (GDC) altered the regulations to allow dental practices to operate as limited companies from 2006, there has been much speculation and misinformation circulating within the profession about whether to take this step. Limited Liability The use of the word ‘limited’ in the title ‘limited company’ refers to limited liability. While even in these parlous times, few dental practices are in danger of clos- ing, the shareholders in a limit- ed company have the security of knowing that their exposure to liabilities to creditors will nev- er exceed their original share capital, usually between £100 and £1,000. Another advantage of trad- ing as a limited company is the higher level of credibility in many commercial negotiations or inter-business relations ac- corded to a company compared with a sole trader. Selling to a third party It is often easier to transfer the ownership of a practice trading as a limited company. This is be- cause the company remains in existence unless it is dissolved or liquidated. The existing business ar- rangements, bank accounts and supply contracts, for exam- ple, all stay the same under the new ownership, while the new owner of a sole-trader practice would need to re-establish these relationships under his/her own name. This is especially impor- tant with PCT contracts, which should be unaffected, provided the PCT has been properly ap- proached at the time of incorpo- ration and the PCT contract has been transferred into the limited company without restriction. Experience shows that incorpo- rated practices with PCT con- tracts are realising higher sell- ing values than unincorporated practices, partly for this reason. The process of incorporation and the resulting altered tax re- gime enables converting sole traders to use tax savings aris- ing from incorporation to sub- stantially increase their pension contributions without affecting their current quality of life, sub- ject to the new rules on pension contributions for high earners. Tax benefits Other taxation benefits, related to the differences between how individuals and companies pay tax and National Insurance, de- pend on the individual’s income, which is effectively the prac- tice’s profit in any given year. Limiting your affairs Michael Lansdell outlines the advantages of incorporation for an independent practice owned and operated by a dentist or partnership ‘Shareholders in a limited company have the security of knowing that their exposure to liabili- ties to creditors will never exceed their original share capital’ October 11-17, 201022 Money Matters United Kingdom Edition DECAPINOL® creates an invisible barrier that prevents bacteria from adhering to the tooth surfaces. ■ Clinically effective in prevention against plaque and gingivitis as shown in multiple clinical studies ■ Unlike other dental products DECAPINOL® gently and safely protects against gingivitis ■ Preventative against periodontitis DECAPINOL® promotes a healthy long-term plaque management. ■ Maintains a healthy balanced oral micro flora ■ No semi-permanent staining ■ Minimal alcohol content ■ No interaction with Sodium Lauryl Sulfate (SLS) Start recommending DECAPINOL® Stop plaque coming back! Healthy plaque management DECAPINOL® mouthwash and toothpaste – A new and intelligent way to manage gingivitis and prevent periodontitis. 1-0-2010-8-1-1-1 For more information please contact the customer care line on: +44(0)1483 410600 or email decapinol@sinclairpharma.com or visit www.decapinol.com DECAPINOL® is registered as a Medical Device IIa and patent protected. Sinclair Decapinol Ad A4 20 08 10 AW.indd 1 30/9/10 11:06:25