Buying or Selling a Dental Practice

Whether you’re purchasing or selling a dental practice, it’s likely to be one of the most significant financial decisions you’ll ever make.

That’s why it’s essential to appoint a solicitor with the right expertise who can make sure that both you and your business effectively manage every potential risk, and that all formalities surrounding the transfer are properly completed on time.

Key Considerations When Buying or Selling a Dental Practice

1. Heads of Terms

This document sets out the main points of the proposed deal — essentially an “agreement to agree.” It’s not always essential in dental transactions, and the sale remains subject to contract until all details are finalised. Until then, either party may still walk away.

If a holding deposit is involved, it’s wise to have clear documentation outlining the conditions for payment and repayment. Heads of Terms can also include an exclusivity period during which only the buyer may proceed with the purchase.

2. Due Diligence

It’s crucial to fully understand what you’re buying — and the risks that come with it. This process should include a detailed review of the seller’s responses to due diligence enquiries and a report on the findings. Any concerns should be followed up on to ensure there are no unwelcome surprises post-completion, and where risks can’t be avoided, appropriate legal protections (such as warranties and indemnities) should be secured.

For sellers, buyer’s enquiries should be answered swiftly, thoroughly, and accurately. As due diligence can take several months, managing the process carefully to prevent unnecessary delays is key— especially where exclusivity periods or loan drawdown deadlines are involved.

Your legal expert should work alongside your accountant to analyse the practice’s income — including any capitation schemes, NHS contract targets, and fee-per-item private income.

3. Clinical Risk

For buyers, it is important to identify and minimise any specific risks revealed during due diligence, as well as those typically associated with practices of a similar type.

For sellers, negotiating to reduce your exposure to these risks as much as possible is key, while still ensuring the transaction progresses smoothly and without delay.

4. NHS Contracts

For individual or partnership-held NHS contracts, the partnership route can be used to transfer the contract to the buyer, making sure all required notices are served correctly, within the proper timeframes, and to the right recipients.

When the NHS contract is held by a company, it transfers automatically with a share sale, since the company remains the contract holder. However, the GDS contract terms should be carefully reviewed to confirm compliance with any obligations to notify NHS England of a change in control — or to seek approval beforehand, if required.

For buyers, your solicitor should also advise you on UDA/UOA performance levels and ensure they’re protected against any clawback connected to the GDS/PDS contract.

5. Employees and Clinicians

In share sales, all staff and associates are typically employed by the company, meaning there’s no change in employment relationships after completion. It is important that the relevant contracts during due diligence are reviewed to confirm this.

For individual or partnership sales, staff and associates are usually engaged by the sellers directly and must be transferred to the buyer. Employed staff transfer automatically under TUPE (unless they opt out). Your solicitor should provide clear advice to ensure all employees are treated fairly and lawfully during the transition.

The position with self-employed clinicians is more complex — and advice on this when the sale agreement is being prepared is key.

If confidentiality is a concern, it is important to consider discreet communication, often limited to private email addresses and outside of practice hours.

Some buyers also prefer the seller to remain as an associate temporarily — helping with a smooth handover or protecting goodwill. Here you can consider arranging for part of the purchase price to be deferred based on performance and assist with drafting the associate terms.

6. CQC

Every dental provider in England must hold a valid Care Quality Commission (CQC) registration. It’s a criminal offence to operate without one.

Additional CQC applications are often required to transfer NHS contracts. For example, using the partnership route may require a corresponding CQC partnership registration to temporarily hold the NHS contract during the transition.

Because CQC applications can take time, it’s crucial to start the process as early as possible. DR Solicitors works with several specialist CQC service providers and can assist with any registration issues, whether you’re buying or selling.

7. Property

Every dental practice needs premises — which means there’s almost always a property component to the transaction, from buying or selling a freehold, assigning a lease, to taking on a new lease. Sometimes sellers retain ownership of the property and instead grant a lease to the buyer, keeping it as an investment. In other cases, the property may be held in a SIPP, requiring specialist handling. Your solicitor should coordinate all aspects of the property transfer to align with the business sale.

It is also important to ensure the premises meet the high regulatory standards expected of a dental practice.

DR Solicitors collaborates with trusted professionals across the dental sector — including accountants, IFAs, finance brokers, valuers, architects, and business advisers — and we can connect you with the right experts for your specific needs.