The issue of incorporation for dentists has become more complex following both the 2014 Autumn Statement and the 2015 Budget. Alan Suggett is a specialist dental accountant and a member of the NASDAL technical committee and believes incorporation can still be advantageous for some dentists.

He explains how the potential tax benefits of incorporation have been impacted:

  • Full CGT (28%) payable at sale of goodwill to the limited company (rather than 10% under Entrepreneurs Relief)

  • Abolition of Corporation Tax Relief on 'amortisation' of goodwill in the limited company. This effectively means additional tax payable of 20% of the goodwill value

  • Abolition of the tax credit on dividends. This leads to an extra income tax charge of 7.5% on dividend income taken from limited companies (other than the first £5,000).

As a consequence, he says, various planning schemes have been devised, but not all are practical and depending on individual circumstances, might be inadvisable. Advice from a specialist dental accountant and lawyer is essential.

To contact Alan, email alansuggett@unw.co.uk or to find out more about NASDAL, go to www.nasdal.org.uk