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Dental Tribune United Kingdom Edition | 4+5/2016 12 TRENDS&APPLICATIONS By Amanda Maskery,UK Whether you are in the final stages of your career or just starting out, the need for a succession plan and exit strategyisequallyimportant.Youmay beasolepractitionerorpartnerwithin a partnership or own shares in an in- corporated dental practice, or it may be that you are contemplating the purchase of your first acquisition— one thing you need to ensure is that provision is made for a future sale or thecircumstanceofasuddendeath. While,admittedly,leavingthebusi- ness may seem a long way off and a successionplanissomethingthatwill most probably not be foremost in yourmindwhileyouarebusyrunning your practice portfolio, by planning nowforthefuture,youwillsaveyour- selfagreatdealofpotentialcostsand legalwranglingfurtherdowntheline. It is very important to specify who wouldtakeoveryourpracticeshould you decide to sell or should you un- expectedly pass away. In running a practice, you will invest much time and money building up the business and will probably have the goodwill of a loyal and long-standing group of patients, so it is essential you know yoursuccessorwillbuildonyourhard work. This will also make the transi- tion smoother for the business and patientsafteryouleave.Onewaytodo thisisbybringinginanassociatewell inadvancewhohasaninterestinone dayacquiringhisorherownpractice. If the associate is brought in in good time,heorshecanbecomeintegrated within the business, learn how the practiceoperatesandestablisharap- port with patients. This will reduce some of the issues that may arise when a stranger takes over a practice andwillputyourmindatrestthatthe practicewillbeinsafehandsmoving forward. Another major consideration in succession planning, for NHS prac- ticesinparticular,istheNHScontract. Even if a practice is mainly private, there could still be an NHS children’s contract,inwhichcaseconsideration hastobegivenastohowthiscontract would be affected. At present, a prac- tice may have a general dental serv- ices(GDS)contractorapersonalden- tal services (PDS) contract. While the first can be transferred as part of the saleofadentalpractice,theothercan- not. If you are considering selling yourpracticeandhaveaPDScontract, youneedtobeawarethattheprocess will involve transferring it to a GDS contract, which involves an applica- tiontotheNHS. Ifyouareasoletrader,orapartner, and hold a GDS contract, the process is not as straightforward as transfer- ringthecontractstraighttothebuyer, as NHS England prohibits GDS con- tracts from being directly trans- ferred. A temporary partnership will needtobesetupbetweentheretiring dentist and the buyer. Once the sale has been completed, notice must be given to NHS England that a new partnershiphasbeenformed.Within a certain period after the sale, the seller will then formally retire from the partnership. Again, notice must be given to NHS England. The GDS contract is then left in the name of thebuyer. If you are an incorporated com- pany and hold a GDS contract, the easiest way of transfer is the sale of the entire issued share capital to the buyer. It is important to note that if this is the way in which the contract will be transferred, there are certain provisionswithinGDScontractsheld by limited companies regarding change of control that require NHS England’spermissionforthecontract tobetransferred. Your initial plans may be to sell your practice and then retire com- pletely—although one good way of ensuring that the goodwill of the practice is protected is for the seller to continue to work at the practice as an associate after completion of the sale and slowly phase out his or her involvement. If the seller is happy to Succession and exit strategies Avoiding costs and legal wrangling AD DTUK0416_12-13_Maskery 25.05.16 10:21 Seite 1 DTUK0416_12-13_Maskery 25.05.1610:21 Seite 1