Associate Dentist Tax Calculator
See how much more you could keep by running your private work through a limited company while keeping your NHS work as a sole trader - so your NHS Pension stays protected.
Built for associate dentists, using 2026/27 rates and the same method our accountants use. Scotland and England & Wales.
Sole trader or limited company - the associate dentist question
Most associate dentists start as a sole trader, declaring all of their income - NHS and private - through Self Assessment. As private work grows, the question becomes whether some of that income should run through a limited company instead. For associates the answer is rarely all or nothing, because of one thing that sets dentists apart: the NHS Pension.
You cannot be a member of the NHS Pension Scheme through a limited company. So the structure that works for most associates is a split - keep your NHS work as a sole trader to protect your pension, and consider a company for your private profit. This calculator models exactly that split against staying fully self-employed.
Why keep your NHS work as a sole trader
Your NHS work is pensionable, and the NHS Pension is one of the most valuable parts of an associate's package. As well as your own tiered contribution, the NHS funds roughly 22.5% in Scotland or 23.7% in England and Wales of your NHS pensionable pay every year - money you simply lose if that income is routed through a company, because a company cannot be a scheme member.
That is why we never recommend incorporating your NHS income. Keeping it as a sole trade keeps you in the scheme, keeps your record clean for the annual reconciliation, and keeps that employer contribution working for your retirement.
How the NHS and private split works
The split treats your two income streams in the two ways that suit each best.
- Declared through Self Assessment, as now.
- Income tax and Class 4 National Insurance on the profit.
- Stays inside the NHS Pension Scheme, with the employer contribution preserved.
- Your pensionable pay certificate and reconciliation handled.
- Private profit taxed at 19% corporation tax, not your higher personal rate.
- You draw a tax-efficient mix of dividends.
- Profit you do not need can stay in the company, taxed only at 19% until you draw it.
- Limited liability and a more flexible base for planning and growth.
The calculator above shows both routes side by side, with your NHS Pension contribution and the corporation tax, dividend tax and retained profit all modelled for 2026/27.
Which costs go where in the split
The calculator works on your NHS profit and your private profit after costs, so allocating each cost to the right side is what keeps the split both efficient and legal. The principle is simple: a cost is claimed against the trade it genuinely belongs to.
- Anything wholly for your NHS work.
- Your share of indemnity for NHS sessions.
- NHS-related admin and use of home for NHS work.
- Lab fees on private cases.
- Materials for private patients, your share.
- Private marketing, software and consumables.
- Indemnity for your private work.
Costs you would carry across both - GDC registration, professional subscriptions, CPD and courses, loupes and equipment, mobile, accountancy and travel - are split on a just and reasonable basis, usually by your NHS-to-private income ratio or actual usage, applied the same way each year and kept on record. Each cost must be wholly and exclusively for the trade it is claimed against.
There is a legitimate efficiency angle too. Relief on a genuinely shared cost is worth more against your NHS sole trade, taxed at up to 42% to 48% in Scotland, than against the company at 19% - so a defensible apportionment that leans toward the sole trade saves more tax. It has to reflect reality, though, and it lowers your NHS pensionable pay, so there is a tax-versus-pension balance to strike. Getting that allocation right, maximised and able to stand up to HMRC, is exactly what we do when we set your split up and run it each year.
To get your two figures for the calculator from a single profit number, the quickest way is to split your profit in the same proportion as your income - if 55% of your income is NHS, treat about 55% of your profit as NHS, then shift a little onto private to reflect lab fees. For a closer figure:
- NHS profit = your NHS income, less the costs that belong to NHS work.
- Private profit = your private income, less your private costs - lab fees, private materials and private marketing.
- Split your shared costs by your NHS-to-private income ratio, and take each share off the matching side.
Those two results go straight into the boxes above. A rough split is fine for a first look - we confirm the exact figures, and keep them right each year, when we set you up.
The April 2023 status change
For decades, a long-standing concession let dental associates be treated as self-employed almost automatically. That concession was withdrawn from April 2023. Status now depends on the facts of your actual associate agreement and how you work, not on a blanket rule.
For most associates on a standard agreement, genuine self-employment still holds - but it needs to be right, because the position now rests on substance. We review your agreement and working arrangements so your status stands up, and so the split structure sits on solid ground.
Worked example - an associate on £100,000
An associate in Scotland with £55,000 of NHS profit and £45,000 of private profit, drawing efficiently and retaining the surplus at 19%. The NHS Pension is protected either way.
In England and Wales the gap is similar - an associate with £40,000 NHS and £60,000 private keeps around £9,400 more a year through the split. Change the figures in the calculator above to see your own position.
When does the company route pay off?
The advantage grows the more private profit you make and the less of it you need to draw straight away. Profit you leave in the company is taxed at just 19%, rather than the 42% to 48% a higher-earning sole trader pays in Scotland (40% to 45% in the rest of the UK). Draw every penny as dividends in the same year and the two routes are close; retain profit, or draw it in lower-income years, and the company pulls clearly ahead.
It is a realistic guide on 2026/27 rates, not a full review. It does not model capital allowances, the pension annual allowance, a spouse shareholder, student loans or benefits in kind, and dividend tax is due on retained profit when you eventually draw it. We confirm the exact position for your circumstances.
From your figures to your setup
Once the numbers make sense, the next step is getting the structure in place properly - the company formed, your NHS sole trade kept clean and registered, your agreement reviewed and the drawing strategy set. That is exactly what we do for associate dentists through our dental accounting service. The split needs both sides set up, so start with whichever fits you.
How to use this calculator
- Choose Scotland or England & Wales.
- Enter your NHS profit and your private profit for the year - estimates are fine, and you can work them out here first.
- Pick how you draw from the company, then read your result instantly and book a review to confirm it.
Frequently asked questions
Should an associate dentist be a sole trader or a limited company?
For most associates the best answer is a split - keep your NHS work as a sole trader to protect your NHS Pension, and consider a limited company for your private profit, which is then taxed at 19% corporation tax. The calculator above shows the difference for your own figures, and we confirm the right structure for your circumstances.
Why does NHS income have to stay as a sole trader?
Because only an individual can be a member of the NHS Pension Scheme - a limited company cannot. If your NHS income were paid to a company, it would no longer be pensionable: you would stop building your NHS pension and lose the NHS employer contribution worth roughly 22.5% in Scotland or 23.7% in England and Wales of your pensionable pay every year. Keeping NHS work as a sole trade is the only way to protect that, which is why the split runs NHS income as self-employment and uses a company only for private work.
Can an associate dentist be in the NHS Pension Scheme through a limited company?
No. The NHS Pension Scheme cannot be accessed through a limited company, so income routed through a company is not pensionable and loses the NHS employer contribution. That is exactly why we keep your NHS work as a sole trader and only use a company for private income.
How does the NHS and private split work?
Your NHS income stays as a sole trade, taxed through Self Assessment and kept inside the NHS Pension Scheme. Your private income runs through a limited company, taxed at corporation tax, with dividends drawn efficiently and any surplus retained at 19%. You get the pension protection of self-employment and the tax flexibility of a company.
Which costs go to my sole trade and which to my company?
Costs follow the work. Anything wholly for NHS work sits in your NHS sole trade; lab fees on private cases, private materials, private marketing and software sit in the company. Costs you carry across both - indemnity, GDC, CPD, loupes, use of home, accountancy - are apportioned on a just and reasonable basis, usually by your NHS-to-private income split, applied consistently. Relief is worth more against the higher-taxed sole trade, but it must be genuine and it affects your NHS pensionable pay, so we set the allocation to be both efficient and defensible.
What happened to the dental associate concession in April 2023?
The long-standing concession that treated dental associates as self-employed almost automatically was withdrawn from April 2023. Self-employed status now depends on the facts of your agreement and how you work. For most associates on a standard agreement it still holds, but it needs to be right, and we review it for you.
How much tax does an associate dentist pay in 2026/27?
As a sole trader you pay income tax and Class 4 National Insurance on your profit, at Scottish or rest-of-UK rates, plus your tiered NHS Pension contribution on NHS pensionable pay. Run private income through a company and that slice is taxed at 19% corporation tax, then dividend tax when drawn. The calculator works out both for your figures.
Do associate dentists pay corporation tax?
Only on income run through a limited company. Private profit in a company is taxed at 19% up to 50,000 pounds, with a tapered rate above that. Your NHS income stays as a sole trade and is not subject to corporation tax.
Is it worth going limited for private dental income?
Often, yes, once your private profit is meaningful and you do not need to draw all of it each year, because retained profit is taxed at only 19% rather than your higher sole-trader rate. If you draw everything straight away the gain is smaller. The calculator shows your own position, and we advise on the best mix.
How is the NHS pension contribution worked out for associates?
Your contribution is a single tiered percentage of your NHS pensionable pay, set by where that pay falls in the SPPA tiers in Scotland or the NHSBSA tiers in England and Wales. The exact pensionable figure comes from your pension certificate and annual reconciliation, which we handle.
Does this calculator work for Scotland?
Yes. Choose Scotland and it applies the Scottish income tax bands to your NHS and sole-trade income, and the SPPA pension tiers. Dividend tax and corporation tax are the same across the UK, which is part of why the company route can save Scottish associates even more on private income.
What figures do I need to use the calculator?
Just your NHS profit and your private profit for the year, after costs such as lab fees. Rough figures are fine for a first look. If you are not sure, our budget and profit estimator helps you work them out, then bring them back here.
This page and the calculator are for general information and are an illustration only, not tax advice. They use 2026/27 rates and standard assumptions and do not reflect your full circumstances, including capital allowances, the pension annual allowance, a spouse shareholder or your wider position. Dividend tax is due on retained company profit when it is drawn. Please confirm any figures with A2Z Accounting Solutions before acting on them.
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