Financial
your fair share? Are you getting
Edwardian tenement, rural hamlet or new town new build, the home of your practice is one of your vital tools. Stephen Neville offers a timely reminder on how best to put it to work
N
HS dentists operating in Scotland are enti- tled to claim practice rent reimbursements from April 2005. The
criteria to become eligible for rent reimbursements includes the prac- titioner being registered on the NHS list, together with the practice being approved by the local NHS board, and meeting the criteria of being an ‘NHS-committed’ practice. To be considered an ‘NHS-
committed’ practice, the following must be met: • The dentists within the practice provide general dental services to all categories of patients • The dentists within the practice have an average of at least 500 patients per dentist accepted for care and treatment under capitation and continuing care arrangements • An average of 100 of these patients, per dentist, mu s t b e fee-paying adults
• And the dentists have average NHS gross earnings of £50,000 or over in the 12 months preceding the quarter for which rent reimburse- ment is sought. Provided you meet all of the
above criteria, you are entitled to claim the lower of actual rent paid versus a deemed market value rent for the property. Where your land- lord charges VAT on the rent, you will be unable to reclaim the VAT back if you are not VAT registered. In which case, ensure the NHS is reimbursing the VAT on your rent as you are entitled to this under Statement XV of the Statement of Dental Remuneration. In the case of an owner-occupier, the reim- bursements would be based on the deemed market value rent. Surveyors were appointed by
the NHS to carry out valuations in 2005/06 in order to quantify an appropriate market value rent for each practice. Thereafter, the NHS intended to carry out revaluations every three years. However, if you carry out investment into your practice e.g. a refurbishment, you should bring forward your
revaluation. Improvements of an access,
aesthetic, or technical nature would add value to the property which you are trading from – whether you are the owner-occu- pier or not. In which case,
where your payments are based on the
“There are many financial, income and tax planning opportuni- ties around practice property”
market value, you should consider approaching your board for an early revaluation to potentially receive an uplift in your rent reimbursement. The real opportunity here is if
you own the property from which you practice. You can improve the property and claim a higher rental reimbursement based on the higher market value after the investment. Note that where NHS funds have been used to carry out the upgrade, then the uplift may be abated. Furthermore, where the property
is held independently of the prac- tice, there may be scope, in certain circumstances, to reclaim the VAT incurred upon carrying out an upgrade or renovation. When considering capital expend-
iture in a practice you should always bear tax opportunities in mind. Tax allowances on capital expenditure vary from one tax year to the next, therefore if more allowances are available in the current tax year, then it may be worthwhile to bring a project forward. There are many financial, income
and tax planning opportunities around practice property. Advice on how to take these opportunities forward depends on your circum- stances, so it is worthwhile talking to an advisor to see what could be done for your benefit.
® Stephen Neville is a partner at Martin Aitken & Co. Stephen is contactable at
scn@maco.co.uk or by telephone on 0141 272 0000. You can find out more about Martin Aitken & Co by visiting their website
www.maco.co.uk
Scottish Dental magazine 63
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