Accountant for Dentists in BC
A dental office is a capital-heavy business with a large payroll. Operatories, imaging and sterilisation gear cost a great deal, hygienists and assistants are on staff, and associates are often paid on collections less lab fees. The books need to show which chairs and which people actually make money.
EverStone CPA supports dentists and dental corporations across British Columbia, working online, with fees fixed in writing before work starts.
Quick answer: Most practice-owning dentists operate through a dental corporation, subject to their college’s rules, and pay themselves a planned mix of salary and dividends. The accounting priorities are associate pay calculated on collections, a payroll that often includes hygienists and assistants, insurer and patient receivables, and large equipment purchases written off through capital cost allowance.
Dental practices we support
Dental careers tend to follow a path from associate to owner, and the accounting changes at each step.
- Associate dentists paid a percentage of collections
- New owners who have just bought a practice
- Established general practices with hygiene departments
- Specialists running referral-based offices
- Owners with more than one location, or a second corporation
- Dentists planning to sell, or bring in a partner
For Fraser Valley owners, our dental accountant page for Abbotsford covers the same ground locally.
Associate, sole owner or dental corporation
An associate’s structure question is different from an owner’s. Associates ask whether incorporating is worth it at all; owners usually ask how to run the corporation well.
Associates
Many associates file a T2125 and stay unincorporated for the first years. Incorporating can help once income clearly exceeds what you spend, but an associate tied to one office should check for personal services business risk.
Owners
A dental corporation pays the office costs and keeps the after-tax surplus. Active business income it retains is taxed at 11% combined in BC on the first $500,000, a limit shared among associated corporations.
Professional conditions
Your college decides whether a dentist can practise through a corporation, what registration it needs and who may hold shares. Confirm those conditions first. We work the tax plan inside them.
Two corporations
Some owners hold the building or equipment in a separate company. That can make sense, but associated companies share one small business limit and each adds a T2.
Read incorporating a dental practice and when more than one corporation makes sense. Our incorporation advice covers the setup.
How a dentist-owner should take money out
Dental corporations often generate more profit than the owner needs in a year. That makes the choice of how, and how much, to withdraw more important.
A planned salary
Salary builds RRSP room and CPP and gives a T4 for lenders, which helps when financing a practice purchase or a home. It means payroll and remittances on schedule.
Dividends on top
Dividends let you draw profit without payroll. They do not create RRSP room. Dividends to family shareholders, where permitted, face the tax on split income rules.
What stays in the company
Profit not needed personally can repay practice debt or build savings inside the corporation. Large passive investment income can reduce the small business limit.
Compare figures with the salary vs dividends calculator, and read bonus vs dividend at year-end.
GST and PST in a dental office
Settled office by office
GST/HST and PST outcomes for a dental practice depend on the particular service and on the regulated status of whoever provides it. Cosmetic work, retail products and supplies bought for the office can all need separate consideration.
Rather than publish a general rule, we confirm the treatment for each practice. Email us how your office bills and what it sells, and we will confirm it in writing as part of reviewing your enquiry.
Hygienists, assistants and associate dentists
Payroll is usually a dental office’s largest cost after the owner. Getting it right each pay period matters more than any year-end adjustment.
Clinical and front office staff
Hygienists, assistants and administrators are generally employees. Withhold and remit source deductions, pay at least 4% vacation pay (6% after five years) and issue T4s by the last day of February.
Associate agreements
Associates are commonly paid a share of collections, with lab fees shared on an agreed basis. The agreement and the way the associate works should both support contractor status.
EHT and WorkSafeBC
A larger office can pass the $1,000,000 BC remuneration threshold for Employer Health Tax. WorkSafeBC registration and premiums apply from the first employee.
Our payroll services run pay, remittances and slips. Read the Employer Health Tax guide and statutory holiday pay.
Production, collections and lab fees
Your practice management software reports production by provider. The bank shows collections. Associate pay, lab costs and receivables all sit between the two.
Production vs collections
We track what each provider produced and what was actually collected, from patients and insurers. Associate pay calculated on collections then ties straight to the books.
Insurer and patient balances
Assigned claims, patient portions and payment plans all create receivables. A monthly aged list shows what is overdue before it becomes a write-off.
Lab fees and supplies
Lab invoices are matched to the associate who ordered the work. Dental supplies are tracked so that monthly costs reflect what the office really used.
See our monthly bookkeeping and the guide to collecting receivables. Management reporting adds monthly figures by provider.
Chairs, imaging and a practice purchase
Dental equipment is expensive and long-lived, so the tax deduction comes through capital cost allowance spread across several years.
- Chairs, delivery units, imaging and sterilisation equipment each go into the right CCA class
- Practice management software and computers have their own class
- Leasehold improvements to an office are depreciated over the lease
- Goodwill paid when buying a practice has its own CCA treatment
- Buying shares rather than assets changes what the buyer can deduct
Read about CCA classes and interest on practice loans. A lender will want lender-ready statements before a purchase.
Issues dentists raise with us
Buying into a practice
The allocation between goodwill, equipment and supplies sets the buyer’s deductions and the seller’s tax. Agree it in the purchase agreement, not afterwards.
Selling a practice
Owners who sell shares of a qualifying corporation may be able to use the lifetime capital gains exemption. The corporation has to meet the tests well before the sale.
Public dental programs
Claims under government dental programs are another payer to reconcile. Track them separately from private insurers.
Staff benefits
Health and dental coverage for staff, and a health spending account for the owner, need setting up correctly to stay non-taxable.
See the lifetime capital gains exemption guide and taxable vs non-taxable benefits.
Month-end routine for a dental office
Run this each month so the T2 at year-end is a review, not a scramble.
- Close the day sheets. Export production and collections by provider for the month.
- Match deposits. Tie insurer, card and patient payments to the collections report.
- Review receivables. Follow up old insurer and patient balances.
- Pay associates from collections. Apply lab fee sharing and check each statement.
- Post payroll. Confirm remittances were made on time.
- Enter lab and supply invoices. Code each to the right provider or account.
- Reconcile every account. Bank, credit cards and practice loans to statements.
Our month-end close service takes this over for busy offices.
Dental practice services and fees
- Associate dentist self-employed return: commonly $250–$450
- Personal return without business income: from $100
- Monthly bookkeeping: from $300 a month, GST and PST filing included
- Dental corporation T2 and statements: quoted after a free consultation
- Ongoing financial oversight as a fractional controller: from $1,500 a month
- Practice purchase planning as a fractional CFO: from $2,500 a month
Fees are agreed in writing before any work. Every published fee is on our pricing page.
Questions dentists ask
Should an associate dentist incorporate?+
How are associates usually paid?+
When is my dental corporation’s T2 due?+
Written and reviewed by a Chartered Professional Accountant at EverStone CPA, an Abbotsford CPA firm working remotely with businesses across British Columbia. Updated . Before you write to us, you can read client reviews. How pages are checked is set out in our editorial standards.
Related reading
More for dentists and other health professionals.
Send an enquiry
Tell us whether you are an associate or an owner, how many providers and staff you have, and anything coming up such as a purchase or sale. A CPA replies within one business day with a fixed fee in writing.