Upcoming Tax Changes To Selling A Dental Practice + Pre-Budget Speculation with Nathan Atkinson [CPD Available]

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A lot changes when the cost of selling your life’s work starts creeping up. We sit down with healthcare M&A specialist Nathan Atkinson to map the moving parts around business asset disposal relief, how the dental deals market heats up ahead of Christmas, and what smart owners can do today to protect value tomorrow. If you’ve wondered whether to push for a pre-Budget completion or wait for clarity, this conversation gives you the practical lens you need.

We start with the basics: why BADR rate moves influence deal timing and how buyers behave when sellers feel a deadline. Nathan explains the year-end rush, solicitor bottlenecks, and why a lively market doesn’t automatically equal bargain prices. From there we explore what’s known versus unknown in the policy pipeline, including the risk of further capital gains tax changes and shifts to employer national insurance that could squeeze larger practices and corporates.

The heart of the episode focuses on fundamentals that outlast Budget cycles. Many NHS-reliant practices are seeing higher turnover without better margins, thanks to cost creep and payroll pressures. We talk through how buyers read those numbers, why EBITDA quality drives valuation, and the practical steps owners can take to shore up margins, trim admin costs, and present clean, consistent accounts. Nathan’s core message is simple: plan earlier than feels comfortable. Five to eight years out is not too soon to optimise share structures, align partners, formalise associate agreements, and build a documentation trail that speeds diligence.

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Disclaimer: All content on this channel is for education purposes only and does not constitute an investment recommendation or individual financial advice. For that, you should speak to a regulated, independent professional. The value of investments and the income from them can go down as well as up, so you may get back less than you invest. The views expressed on this channel may no longer be current. The information provided is not a personal recommendation for any particular investment. Tax treatment depends on individual circumstances and all tax rules may change in the future. If you are unsure about the suitability of an investment, you should speak to a regulated, independent professional. Investment figures quoted refer to simulated past performance and that past performance is not a reliable indicator of future results/performance.

Chapters

• 0:00 Setting The Tax Scene
• 2:07 BADR Changes And Seller Behaviour
• 4:10 Market Heat Before Christmas
• 5:31 Known Versus Unknown Policy Shifts
• 6:28 Budget Speculation And Ads Break
• 9:21 Likely Tax Moves And CGT Trajectory
• 12:35 Income Tax Bands And Stealth Effects
• 15:35 NHS Contracts, Margins, And Profitability

Transcript

Dr James: 0:00

We have heard so much about how BADR is going up over the next few months, and that's not the only tax change that used dents need to be aware of when it comes to selling our dental practice, and what exactly is Rachel Reeves gonna do at the end of November with of course the budget. That's why I'm joined today by Mr. Nathan Atkinson. We're gonna be talking all of the above and a lot more dental practice skills, trivia, and knowledge and facts and know-how. Looking forward to getting into this one. I'm also happy to share that there is free verifiable CPD associated with this podcast episode. Whenever you finish the episode, all you have to do is click the link in the podcast description. It'll take you right through the Dentists Who Invest website. You'll be able to complete a short questionnaire, and once passed, you fill in your reflections, and we'll go ahead and email over to you your verifiable CPD certificate, which is entirely free. What that means is this podcast episode will be able to contribute towards your verifiable CPD hours during this learning cycle. What's up, Nathan? Let's talk about what we were talking about in the intro just there. And when I say that, what I'm obviously referencing is the fact that BIDR is going to go from 14% to 8.18% before uh that is after uh April the 5th, 2026. I've got that right, haven't I?

Nathan: 1:26

Absolutely. No, and uh yeah, thanks very much for uh having me, James. I think it's a fairly hot topic uh in the dental space and the healthcare space in general at the minute. Um obviously uh NHS contract funding's um not necessarily as attractive as what it used to be, and and now we're getting hit with um further penalties when we want to sell our life's work and benefit from it. So yeah, it's uh certainly a big area of discussion uh on my desk at the moment.

Dr James: 1:55

You know, it's an interesting one, and I know that obviously you run a firm that helps dentists sell their dental practice, and you were telling me just off camera before we jumped on that right now, as we're talking November 2025, is really, really, really particularly hot for two reasons. Everybody wants to get things wrapped up before Christmas, and also in in in your opinion, from what you can see, well, it's probably got something to do with this increase in BADR2.

Nathan: 2:22

Yeah, yeah, twofold. Um, and again, not just dentists, but it's kind of across the all of the healthcare sectors in general. You know, my my Christmas starts on the 1st of December. Um, not because I want it to, um, but because everyone else um shuts up shop and you know, if solicitors aren't working, um, aren't wanting to complete complete deals between Christmas and New Year at the end of the month, um, then you know deals just aren't going to complete. So kind of 30th of November is um our cut-off for deal completion. So you've got people you know rushing to get things done before Christmas for a bit of peace of mind so they can go and have some time with the kids without thinking about the business. Um, but then coming in April, as you say, start the new tax year, business asset disposal relief increases by four percent again. So there's certainly an incentive for um dental practice owners who are selling to rush deals through um prior to that. Um you know, and in fact, I've got people picking up the phone to me at the moment that haven't even found their buyer yet and just wanting to start the process now, but they've left it a little bit late and all of a sudden they've gone, yo crap, you know, it's uh time to push the button and try and save uh save a few quib. So uh yeah, all go at my end at the moment, definitely. I can imagine.

Dr James: 3:37

Well, you think do you think it's safe to sell some bargains out there at the minute?

Nathan: 3:41

Um I don't know. I don't know if it changes the fact that uh any retirement-driven seller wants a premium for their business, which is understandable after, you know, in some cases, uh two decades. But I I would say that the market is very lively. I think buyers recognise that sellers have an incentive to sell at the moment um and are therefore being a little bit more aggressive in kind of seeking out deal flow. Um, you know, aggressive maybe not the right word, but there's plenty of buyers out there that recognise there's an opportunity and are and are kind of looking to pounce when the right business uh comes up.

Dr James: 4:15

Um any other tax changes that are due to be implemented on April the 6th that we know of right now? We'll we'll come on to Rich Rees budget speculation in just a moment, but is there any more that we already know are gonna happen?

Nathan: 4:34

No, not necessarily. Um, I think there's some things that are given, but as you say, we'll come on to that in in a moment. Um, I think the the key thing for me looking at this objectively is someone some you know, as someone who's not looking to sell a business anytime soon. Um we had uh planned changes in 2025, April 2025, um business asset disposal relief went up by four percent then um with stage two which comes in April 26, um, but there was nothing announced beyond that. So I think for me it's that the biggest concern is actually what's in the yeah, what's in the briefcase this time round, and and and and I don't expect that uh there would be nothing that's gonna impact business owners um when they do come to to to sell their assets.

Dr James: 5:29

Interesting. So nothing that we know of so far, at least things that are gonna affect the business owners, which brings us on to the next item for discussion, which is a little bit of how can we say this? We know it's speculation, but it's still fun to back and forth about. And people people are interested to hear this stuff, what we think Rachel Reeves might do at the end of the month. UK dentists, if you are just starting out on your investment journey or you're already investing and want to know if your strategy is 100% foolproof and optimized to reduce fees and maximize growth, then you might like to know. I have teamed up with independent financial planner Luke Hurley to create the Dentist Who Invest Academy. Dentists who invest academy fully documents the process that a financial planner would normally perform for a client behind the scenes and reveals it to you. This means that you can implement it into your own life, therefore pulling your financial freedom date forward by years. If you wish to set up and manage your own investment portfolio, then this is designed to give you all the tools and knowledge you need to perform this properly. This means that when viable and appropriate, you will have the know-how and skill required to build and manage your own investment portfolio, plus ensure that it is 100% optimized. If this sounds like your thing, then keep an eye out on the Dentist Who Invest mailing list where we'll be announcing the details of the next intake very soon. UK Dentists, if you are just starting out on your investment journey or you're already investing and want to know if your strategy is 100% foolproof and optimized to reduce fees and maximize growth, then you might like to know. I have teamed up with independent financial planner Luke Hurley to create the Dentist to Invest Academy. Dentist who invest academy fully documents the process that a financial planner would normally perform for a client behind the scenes and reveals it to you. This means that you can implement it into your own life, therefore pulling your financial freedom date forward by years. If you wish to set up and manage your own investment portfolio, then this is designed to give you all the tools and knowledge you need to perform this properly. This means that when viable and appropriate, you will have the know-how and skill required to build and manage your own investment portfolio, plus ensure that it is 100% optimized. If this sounds like your thing, then keep an eye out on the Dentists Who Invest mailing list where we'll be announcing the details of the next intake very soon.

Nathan: 7:53

For me, I think the the I mean with with the the biggest thing that I've seen of late and and some of the murmurs I've heard with some of the accounts that I deal with is actually uh tax hikes on um kind of what we call sort of mid-bracket salaried um individuals. Um, you know, supposedly uh if you're earning 50 grand you're not working class anymore, and all of a sudden we're gonna get hit with some uh some tax hikes there. But I think from a from a business perspective, um I could certainly see further changes to NI contributions, which is obviously gonna um affect some of the larger dental businesses and some of the corporates dramatically. Um I would also be incredibly surprised if we don't see the next um the next sort of two tiers of um business asset disposal relief cuts um and corporation um sorry, capital gains tax hikes for April 27, April 28. I think they'll they'll sort of keep that trend running until uh the end of their term.

Dr James: 9:00

Oh way, it's already gonna be really high. That's crazy.

Nathan: 9:04

Yeah, I think it's uh I think it'd be a stupid move to make kind of penalising uh businesses for being successful and penalise people when they want to retire. But I think that's all we can do is kind of guess based on the the trend and the pattern, and that's where I can see it going. But certainly I certainly hope not, although it'll mean my desk's busy uh um it came for the next two years quite comfortably, but you know, I certainly hope not.

Dr James: 9:31

Remember when it used to be called entrepreneurs relief and it was 10 the first 10 million, wasn't it?

Nathan: 9:37

Yeah, yeah, that was it. Um million, then it they cut it to was it a million? I think the cut it to um yeah, I think we'll be lucky if there's uh we'll be lucky if there's such a thing as relief uh within the next three or four years without being too doom and gloom.

Dr James: 9:56

Oh no, no, no, no, I don't even want to think about that. Oh wow, okay, cool. So those what about income tax? I've seen people speculate on that a lot. Well, you kind of did allude to it there, didn't you really?

Nathan: 10:06

Yeah, I mean tax tax isn't really my bag when it comes to um you know the personal side of things. Obviously, I keep a um you know keen uh keen eye and keen interest on the um corporation tax, capital gains, and uh what we'll call entrepreneurs' relief still. Um personal tax, from what I've seen, there's potentially people that are earning uh north of 45 grand are about to be those that are hit the hardest. Um you know, and uh I think those are the people that I think the country really needs to uh be able to rely on at the moment, not necessarily by taxing them, but to to keep the uh the products of the economy going.

Dr James: 10:47

I'm not sure if you're well, this is probably between the two of us, this is probably the right thing to bring up. But I did read the other day and I was like, surely this can't be true. Apparently they haven't changed the income tax rates for 20 years. They've changed the they've they've changed the bands potentially, or maybe not change the bands, which is like a stealth tax, right? Because obviously inflation every year means we have to learn more and then they subtly do make more tax for them anyway, if they even freeze the bands. But I read that they hadn't they hadn't touched rates for 20 years. Sound about right?

Nathan: 11:22

Um possibly, yeah. I couldn't tell you. It sounds about right, you know, these hidden kind of uh things that sound good, but in practice aren't really all that good. Yeah, I need to fact-check that one, right? But I did read that and I thought, 20 years, yeah. I don't know. Um it's possible, but um, yeah, I think you you got me um thinking on something there, um, James, which I think is a conversation that I'm having um a lot at the moment, both with um pharmacy owners and dental owners, which are the two main sectors that that I work in, which is um we've got um NHS-based practices, and um, you know, pharmacies are very reliant on NHS as well, NHS income, NHS contracts to sustain the businesses. Um dental practices haven't had um you know reviews or increases to their kind of activity payments. Um pharmacists have had a little bit, and what we're seeing is we're starting to see a pattern where actually people shout um loud in the healthcare sectors because they need more support from um you know the powers that be. Um changes are then made to very incrementally improve um contracts and what that means in terms of profitability, but then we get the tax hikes we've just been talking about increases to national insurance contributions for employers. So it's it's very much a when I'm looking at people's accounts at the moment, um you know, dental practices and pharmacies specifically, I'm seeing a pattern of income's gone up, um gross margin and net margin haven't really changed all that much. Um so I think the biggest tip in light of all the changes we're talking about that I could give um dental practice owners would be when you're speaking to your accountant, um, you know, don't take the increase in turnover as gospel and a big pat on the back. You need to be really uh cautious in in terms of looking at your your margins and your administrative costs as well.

Dr James: 13:24

Yeah, seems completely reasonable. Anything else dentists can do that we haven't talked about today in this podcast by way of mitigating any of these taxes or anything else we should know?

Nathan: 13:36

I I mean yeah, I think number one thing, I think a really good tax advisor is worth a weight in gold at the moment. Um if you haven't got one um and you're coming up to retirement, now's the time to get one, or even yesterday. Um but um I think the other thing as well is because we're in a uh an economy and a tax environment and a you know acquisition disposal market, which is so volatile on on sort of multiple levels um and so dynamic, you've got to be planning way ahead of when you actually want to be exiting. So if you want to exit in you know five, six, seven, eight years, plan now. And that might that might sound daft so far down the line, but um, you know, the more kind of mechanisms, things you put in place, the the easier it's gonna be when you you know come to try and do it well. Um but look, if anyone wants to have a you know chat about any of the topics we've um discussed, um happy to to pick up the phone. Um it's again it's Nathan Atkinson. Um you can find me on um prospect prospect com or my mobile number, which I'm happy to give out with uh zero seven four two eight eight one nine eight zero six. I'd be happy to uh check all things retirement and acquisition.