Accountants for Dentists and Dental Practices
Dentistry is one of the few health professions where you run a capital-intensive small business and treat patients on the same day. A single surgery represents a fit-out, a chair, imaging, sterilisation and a payroll, and the tax treatment of each is different. Crest Accountants has worked with Queensland business owners since 1973, and we act as accountants for dentists at every stage: the new graduate contracting between practices, the associate weighing up buying in, the principal running two or three surgeries, and the owner planning a sale. We are based in Burleigh Heads on the Gold Coast and act for dental practices across Queensland and around Australia.
Why dentists need a dental accountant, not a general one
The problems that cost dentists money are structural, and almost none of them show up on a tax return. Payroll tax on payments to contracted dentists is the largest live exposure for Queensland practice owners and it is assessed by the state, not the ATO. Worker classification across associates, hygienists, oral health therapists and dental assistants carries super and payroll tax consequences that an ABN does not resolve. A surgery fit-out splits across two entirely separate deduction regimes, and the split is difficult to unwind once lodged. The tax you pay when you sell your practice is largely determined by structuring decisions made years earlier.
A general accountant will lodge your return accurately and still miss all four. That is not a criticism of general accountants. It is a statement about how often these issues come across their desk compared with ours.
Payroll tax and dental practices: the exposure most dentists have not been told about
This is the issue we are asked about most often by practice owners, and it is the one the least has been written about. It is worth understanding properly.
Your dental clinic is a "medical centre" for payroll tax purposes
The Queensland Revenue Office public ruling on relevant contracts and medical centres (PTAQ000.6.5, issued 3 March 2025 and effective from 1 December 2024) applies to entities conducting a medical centre business, and it says so expressly: the ruling covers "dental clinics, physiotherapy practices, radiology centres and similar healthcare providers."
Where the arrangement between a clinic and a practitioner is a relevant contract and no exemption applies, the clinic is treated as the employer, the practitioner is treated as the employee, and the payments the clinic makes to the practitioner are treated as wages. That deeming happens regardless of what the agreement is called and regardless of the fact that the dentist holds their own registration, carries their own indemnity cover and runs through their own company.
Dentists did not get the exemption general practitioners got
This is the part that surprises people. Queensland's payroll tax amnesty for contracted dentists ended on 30 June 2025. From 1 July 2025, dental clinics have to start paying payroll tax on payments to contracted dentists unless an exemption applies.
General practitioners were treated differently. The QRO's list of exempt wages states that "wages paid by a medical practice (other than a hospital) to a contracted or employee general practitioner (GP) are exempt." There is no equivalent exemption listed for dentists. So a dental practice sitting alongside a GP clinic in the same building, on materially the same engagement model, can be in a completely different position.
If you were relying on the amnesty and have not revisited your arrangements since, that is the conversation to have now rather than after an assessment arrives.
The flow of the money matters more than the wording of the agreement
The ruling turns on who actually receives the patient's money, not on how the agreement is drafted. Where the clinic collects patient fees and then pays the dentist a share, that share is treated as wages. Where the patient pays the practitioner directly rather than paying the clinic on the practitioner's behalf, the ruling says those payments are not deemed wages. Arrangements that route money through a third party or a clearing house are not a safe harbour either, and the ruling gives an example where exactly that arrangement is still caught.
The practical consequence is that reviewing your service agreement is not enough. We look at the bank flow, the merchant facility, who holds the patient relationship and who is named on the receipt, because that is what the ruling actually tests.
The exemptions exist, but they are narrow
Queensland has nine exemptions for contractor payments, and you only need to satisfy one. The ones that come up in dental practices are the 90-day exemption, where the same or similar services are provided for no more than 90 days in a financial year, the exemption where the business needs services of that kind for less than 180 days in a financial year, the exemption where the work is performed by two or more people, and the Commissioner's discretion, which you have to apply for rather than simply claim, and which is generally available where a contractor provides services to two or more principals for an average of 10 days or less per month.
Read them against a full-time associate and you can see the problem. A dentist who works four days a week in your surgery clears 90 days early in the year. The ruling's own examples make the point sharply: a practitioner spending an hour or two a week with another provider, or splitting time between your practice and a hospital, is unlikely to qualify. The exemptions are real, but they suit locums and genuinely itinerant specialists far more often than they suit the associate who is the backbone of your book.
It only bites above the threshold, and deemed wages count towards it
None of this matters until your total Australian taxable wages cross the threshold. In Queensland that threshold is $1.3 million a year, with the rate then applying at 4.75% for employers or groups paying $6.5 million or less, and 4.95% above that. Plenty of single-surgery practices sit comfortably underneath and always will.
The trap is that once payments to contracted dentists are deemed to be wages, they count towards the total. A practice that pays its nurses, receptionists and practice manager perhaps half the threshold in real salaries can find it is well over once three associates' payments are added in. Grouping rules can compound that where you own more than one entity. This is a calculation worth running deliberately rather than discovering.
If you practise outside Queensland
Payroll tax is a state tax. Each state and territory revenue office has its own legislation, its own rulings and its own position on payments to health practitioners, and those positions are not identical. If you own practices in more than one state, they need to be assessed separately. We act for clients across Australia and handle this state by state rather than assuming the Queensland answer travels.
Associate dentists, hygienists and the rest of your team
There is a common assumption that an ABN and a tax invoice settle the question of whether someone is a contractor. They do not, and the reason is that there is no single question. There are three, and they are decided under three different sets of rules.
The first is payroll tax, covered above, which deems the relationship regardless of the label. The second is the ATO’s distinction between employees and independent contractors, which looks at the whole working arrangement. The ATO is explicit that the label used in the contract does not determine the outcome, and weighs matters such as control, whether the work can be delegated, who supplies the equipment, how payment is calculated and who carries the commercial risk. In a dental practice, where the clinic typically supplies the surgery, the chair, the consumables, the staff and the patients, several of those factors point one way. The third is superannuation. You generally have to pay super for a contractor who is paid mainly for their labour, meaning more than half the value of the contract is for their personal labour and skills and the work cannot be delegated.
Three tests, and it is entirely possible to be right on one and exposed on the other two. We review engagement arrangements across the whole team, associates, hygienists, oral health therapists and dental assistants included, and tell you where you stand on each, including the parts you would rather not hear.
Associate dentists, hygienists and the rest of your team
There is a common assumption that an ABN and a tax invoice settle the question of whether someone is a contractor. They do not, and the reason is that there is no single question. There are three, and they are decided under three different sets of rules.
The first is payroll tax, covered above, which deems the relationship regardless of the label. The second is the ATO’s distinction between employees and independent contractors, which looks at the whole working arrangement. The ATO is explicit that the label used in the contract does not determine the outcome, and weighs matters such as control, whether the work can be delegated, who supplies the equipment, how payment is calculated and who carries the commercial risk. In a dental practice, where the clinic typically supplies the surgery, the chair, the consumables, the staff and the patients, several of those factors point one way. The third is superannuation. You generally have to pay super for a contractor who is paid mainly for their labour, meaning more than half the value of the contract is for their personal labour and skills and the work cannot be delegated.
Three tests, and it is entirely possible to be right on one and exposed on the other two. We review engagement arrangements across the whole team, associates, hygienists, oral health therapists and dental assistants included, and tell you where you stand on each, including the parts you would rather not hear.
Buying into or buying a dental practice
The financials you are shown when buying a practice are the vendor’s story about the practice. Our job is to test it before you sign, not to reconstruct it afterwards.
The questions that matter are rarely the headline ones. How much of the production belongs to the departing principal personally, and how much of that will walk out the door with them? What is the state of the recall list, and how many of those patients are genuinely active? How old is the equipment, and what is realistically left in it before the next major replacement? What do the lease terms look like, and does the lease survive the sale on terms you can live with? What staff entitlements are you inheriting?
Then there is the structure of the purchase itself, which decides your asset protection, your tax position and your options on the way out. We provide business structuring advice for practice acquisitions and model the options against your own circumstances. Involve us before heads of agreement, because the choices that matter most are cheapest to make early.
Surgery fit-out and equipment: two deduction regimes, not one
A dental fit-out is not one deduction. It splits, and getting the split right is worth real money on a six-figure build.
The structural side of the work, the building alterations, the walls, the plumbing and services runs and the structural improvements, generally falls under capital works deductions. Capital works are claimed at a statutory rate, with a basic entitlement of 2.5% a year, which means the cost is written off across 40 years rather than in the year you spend it.
The plant sits under a different regime. Chairs, imaging and radiography equipment, sterilisers, compressors, suction, handpieces, loupes and practice computers are depreciating assets, deducted over their effective life or, if your practice is eligible, under the ATO’s simplified depreciation rules for small business. The write-off available for lower-cost assets changes from year to year, so the timing of a purchase is worth checking against the rules in force before you commit rather than after.
The reason this matters is that a builder’s invoice for a surgery build usually arrives as a single figure. Split it correctly and a meaningful share is deductible over years rather than decades. Fail to split it, or split it optimistically, and you either leave deductions on the table or create an exposure. We work through the invoices line by line, and where the build is large enough we will tell you when a quantity surveyor’s report is worth commissioning.
Service entity arrangements for dental practices
Service entity arrangements are common in dentistry and entirely legitimate. A separate entity owns the equipment, employs the staff and provides the premises and administration to the practice, and charges a fee for doing so.
The point that gets missed is that the ATO applies a commercial test to the fee. Its guidance on service entity arrangements is concerned with whether the arrangement is relevant to the conduct of your business and whether the charges are correctly calculated, so that the payments are not disproportionate or grossly excessive in relation to the benefits the arrangement confers. The ATO publishes indicative rates for typical services, and arrangements charging materially above them attract attention.
So a service entity is not a lever you can simply pull harder. It has to reflect services genuinely provided at fees that stand up commercially, and it has to be documented as if someone will one day ask to see the documentation. We set them up on that basis and review existing arrangements that were set up on a different basis.
Selling your dental practice and capital gains tax
Most dentists think about tax on a practice sale when the sale is in front of them. By then the important decisions have already been made.
A practice sale is not one transaction for tax purposes. Goodwill, equipment and any property are treated differently, and how the price is allocated across them changes what you pay. Where the goodwill is held matters, and so does who has held it and for how long.
The small business CGT concessions are the four that can reduce or remove a capital gain on an active business asset: the 15-year exemption, the 50% active asset reduction, the retirement exemption, which is capped at a lifetime limit per individual, and the small business rollover, which defers a gain where a replacement asset is acquired. Eligibility depends on tests that reach back into how the practice has been owned and operated, which is why the structuring conversation and the exit conversation are really the same conversation held years apart. We handle capital gains tax planning for practice sales and prepare the financials a buyer’s accountant will want to see.
If you are five years out from selling, that is the right time to talk to us. If you are five weeks out, talk to us anyway, but the options are fewer.
Our accounting services for dentists
We cover the full compliance and advisory picture for dental practices and for dentists personally, and we keep both sides pointing in the same direction.
Tax returns and year-end tax planning
Returns for employed and contracting dentists, associates, practice companies and trusts, with profession-specific deductions reviewed properly: Dental Board of Australia registration, professional indemnity insurance, continuing professional development, courses and conferences, instruments, loupes, and home-office costs where they genuinely qualify. Before 30 June we run tax planning, while decisions can still change the outcome rather than merely describe it.
Practice structuring and restructuring
Company, trust, partnership and service entity arrangements, weighed against asset protection rather than tax alone. One caution worth stating plainly: where a dentist earns mainly from their own labour and skills, the personal services income rules can limit income splitting no matter what structure sits around them. A practice with staff, premises and equipment usually sits outside those rules, but a solo contracting dentist often does not, and building a structure without checking is how people end up paying for something that achieves nothing.
Bookkeeping, payroll, BAS and GST
Cloud bookkeeping that reconciles to your practice management software, payroll and superannuation processing, BAS and GST. Dental income is a mix of taxable and GST-free supplies, so the GST treatment needs to be set up correctly at the source rather than corrected each quarter.
Practice performance and cash flow
Reporting that shows production against collections, cost per surgery and per chair, staff cost as a share of revenue, and what a new chair or scanner does to cash flow before you finance it. We have written previously about lifting practice profitability, and the same discipline drives the monthly numbers we produce for practice owners.
Dental accountants for the Gold Coast, Queensland and Australia
Our office is at 5-7 Prosper Crescent, Burleigh Heads, and we work with dental practices right across the Gold Coast and Brisbane. Because our bookkeeping and reporting run in the cloud, we also act for dentists and practices elsewhere in Queensland, in the Northern Rivers, and in every other state. Where your surgery is matte
Why dental practices choose Crest Accountants
Crest has worked with Queensland business owners since 1973. We are registered tax agents, our work is done in-house rather than sent offshore, and we quote the fee before we start so there are no surprise invoices. Dental and health practices are a genuine part of the practice rather than an occasional file, and we also act for doctors, specialists and allied health practitioners across the broader health sector. If you want the background reading first, we have set out what a specialist dental accountant actually does in plain terms.
Most of all, we will tell you where you stand, including the parts you will not like. Payroll tax is the current example. Plenty of practices would prefer not to look. Looking is cheaper.
Book a chat with a dental accountant who has read the ruling. Call Crest Accountants on 07 5538 0999 or send an enquiry through our contact form, and tell us where your practice is heading.
General advice disclaimer
The information on this page is general in nature and does not take into account your personal objectives, financial situation or needs. It is not financial product advice, and Crest Accountants is not an Australian Financial Services Licence holder. Tax and payroll tax outcomes depend on your specific arrangements. Before acting, seek advice from a registered tax agent about your circumstances, and from a licensed financial adviser where financial product advice is required.
Frequently Asked Questions
Any registered tax agent can lodge your return. The difference shows up in the issues that are specific to dentistry: payroll tax on payments to contracted dentists, worker classification across associates and clinical support staff, splitting a surgery fit-out correctly between capital works and depreciating plant, service entity arrangements, and preserving capital gains tax concessions on an eventual sale. Those are the areas where the advice is worth more than the fee, and they are what we deal with regularly rather than occasionally.
Possibly, and more likely than most owners assume. Queensland’s amnesty for payments to contracted dentists ended on 30 June 2025, and from 1 July 2025 dental clinics have to pay payroll tax on those payments unless an exemption applies. The public ruling on relevant contracts covers dental clinics expressly. General practitioners have a specific exemption for wages paid by a medical practice; dentists do not. That said, payroll tax only applies once your total Australian taxable wages exceed $1.3 million a year in Queensland, and many single-surgery practices sit below it. The correct step is to calculate your position including any deemed wages, rather than assume either way.
No. It is evidence, not an answer, and there are three separate questions rather than one. For payroll tax, the arrangement can be deemed a relevant contract regardless of the invoicing. For income tax and super, the ATO looks at the whole working arrangement and has said plainly that the label in the contract does not determine the outcome. And you generally have to pay superannuation for a contractor paid mainly for their own labour. In a dental practice where the clinic provides the surgery, the equipment, the staff and the patients, several of those factors point away from a contractor relationship. We review the arrangement and tell you where you actually sit on each test.
There is no universal answer, and anyone who gives you one before looking at your circumstances is guessing. The choice depends on how many owners there are, whether you intend to bring in associates or partners, your asset protection needs, your family situation, and what you eventually want the exit to look like, since some structures preserve capital gains tax concessions better than others. Personal services income rules also matter if you earn mainly from your own labour. We model the realistic options for your situation and explain the trade-offs of each rather than defaulting to one.
Usually not in full, and the two parts are treated differently. Structural building work is generally a capital works deduction, claimed at a statutory rate with a basic entitlement of 2.5% a year, which spreads it across 40 years. Equipment such as chairs, imaging, sterilisers and compressors are depreciating assets, written off over their effective life or, if your practice qualifies, under the small business simplified depreciation rules. The immediate write-off available for lower-cost assets changes from year to year, so the timing of a purchase is worth confirming against the current rules before you order rather than afterwards.
It depends heavily on how the practice has been owned and for how long, and on how the sale price is allocated between goodwill, equipment and any property. Where the conditions are met, the small business capital gains tax concessions can substantially reduce or remove the gain on an active business asset, through the 15-year exemption, the 50% active asset reduction, the retirement exemption or the small business rollover. Eligibility is largely set by decisions made years earlier, which is why we would rather have this conversation when you are years out from selling than weeks out.
No. Many of our clients are local to Burleigh Heads and the southern Gold Coast, and you are welcome at our office. But our accounting runs in the cloud and we act for dental practices and individual dentists across Queensland, the Northern Rivers and the rest of Australia. Payroll tax is state-based, so where you practise does change part of the advice, and we handle that state by state.
General advice disclaimer
The information on this page is general in nature and does not take into account your objectives, financial situation or needs. Crest Accountants is not an AFSL holder and does not provide financial product advice. QBCC financial requirements depend on your licence category, structure and circumstances. Before acting, seek advice about your own position.
Talk to a dental accountant who understands practice ownership, associate engagements and payroll tax.
Book a consultation with Crest Accountants on 07 5538 0999 or send an enquiry through the form.
