NHS vs Private Dental Practice: Which Is Worth More When You Sell?
One of the most common questions dental principals ask when they start thinking about an exit is: does my NHS contract make my practice more valuable, or less?
The intuitive answer is that NHS income looks attractive to buyers — it is contracted, predictable, and government-backed, which ought to translate into a premium valuation. The reality is more nuanced, and in the current UK market the answer often runs in the other direction. In 2026, well-run private practices routinely achieve higher EBITDA multiples than NHS practices of equivalent size. That does not mean an NHS contract is a liability — but it does mean the relationship between practice model and exit value is not what most principals assume.
This post explains how buyers think about NHS versus private income, what multiples each model typically supports, and what that means if you are planning a sale.
Want to understand the full picture of how dental practices are valued? How UK Dental Practices Are Valued in 2026
The Baseline: How Practice Value Is Calculated
Before comparing models, it helps to recall how dental practice value is calculated. The starting point is almost always EBITDA — earnings before interest, tax, depreciation, and amortisation — which is a measure of the cash profit the business generates. That figure is then multiplied by a market-determined multiple to arrive at a headline valuation. Additional adjustments may be made for property, goodwill, equipment condition, and other factors.
The multiple is where NHS and private practices diverge significantly.
NHS Practices: Contracted Revenue, Compressed Multiples
NHS dental practices derive the majority of their income from an NHS contract with an Integrated Care Board (ICB). That contract specifies the number of Units of Dental Activity (UDAs) the practice must deliver each year, and sets the value per UDA. In theory, this provides a guaranteed, predictable income stream that should command a premium multiple.
In practice, the NHS contract introduces a series of risks that buyers price heavily.
Contract Risk
The NHS dental contract is not a perpetual entitlement. Contracts can be clawed back if UDA delivery falls short, renegotiated at ICB level, or affected by structural reforms. The long-running uncertainty over NHS dental contract reform — and the government’s stated ambitions to shift the model away from UDA-based commissioning — has left buyers uncertain about the long-term value of current NHS contract income. A buyer paying a high multiple for contracted NHS revenue today is implicitly betting that the contract remains on comparable terms for the duration of their ownership.
That uncertainty is reflected in the multiple.
Margin Compression
NHS UDA rates in most ICB areas have not kept pace with rising practice costs — staff wages, indemnity, lab fees, and overheads have all increased faster than UDA reimbursement. As a result, the EBITDA margin on NHS income is typically lower than on private income of equivalent volume. A practice generating £600,000 in NHS contract income may generate a lower EBITDA than a practice generating £600,000 in private fees, simply because the costs of delivering NHS dentistry are proportionally higher.
Lower margin feeds directly into a lower absolute EBITDA — and therefore a lower valuation, even before the multiple is applied.
What Multiple Does an NHS Practice Achieve?
In the current market, predominantly NHS practices — those where NHS income accounts for more than approximately 70–75% of turnover — typically achieve EBITDA multiples in the range of 4x to 5x. High-performing NHS practices with strong UDA delivery records, experienced associate cover, and long-standing contracts may reach the upper end of that range. Practices with underdelivery risk, imminent contract reviews, or below-market UDA values may fall below it.
Private Practices: Higher Margins, Premium Multiples
Private dental practices operate without an NHS contract. Income comes from patient fees, typically supported by a patient membership or plan scheme (such as Denplan or a bespoke practice plan). This model looks structurally different to buyers.
Why Buyers Pay More for Private Income
Private income is margin-rich. A practice generating £600,000 in private fee income will typically produce a materially higher EBITDA than a practice of the same turnover on NHS. Higher margins mean higher EBITDA for the same revenue — and higher EBITDA means a higher absolute valuation even before considering whether the multiple itself is larger.
The multiple is also larger. Private practices with strong recurring income from a well-managed membership scheme, stable patient numbers, and high treatment acceptance rates are among the most desirable assets in the UK dental M&A market. DSOs and private equity-backed buyers competing for high-quality private practices have pushed multiples upward in recent years.
In 2026, well-run private practices typically achieve EBITDA multiples of 5x to 7x, with premium practices — particularly those with a large, loyal membership base and a growing associate team — occasionally exceeding this range.
The Membership Model Premium
Patient membership schemes deserve specific mention. A practice with 1,500 or more active plan patients generates a recurring monthly income that is highly predictable and represents strong underlying business health. Buyers view this as directly analogous to a subscription revenue model in other industries: sticky, measurable, and resilient. Plan income reduces the effective risk premium a buyer applies to the earnings multiple — which is why practices with mature, growing membership schemes command the strongest multiples in the private tier.
Risks in Private Practices
Private practice is not without risk. Without a contracted income floor, revenue is more dependent on the clinical capacity of the principal and associates, patient retention, and the practice’s reputation and marketing. A private practice that is heavily dependent on a single principal — where patient relationships are tied to one clinician — will be discounted relative to one with a multi-associate model and distributed patient relationships.
Mixed Practices: The Most Common Model — and a Nuanced Valuation
Most UK dental practices sit between these poles, operating a combination of NHS contract income and private fee income. The valuation of a mixed practice is not simply a blend of the two multiples: buyers assess the income split and quality of each component, and the multiple applied reflects the specific risk and margin profile of that practice.
As a general principle: the higher the private income as a proportion of total revenue, the closer the practice will trade to the private multiple. A practice that is 40% NHS and 60% private will typically be valued more favourably than one that is 70% NHS and 30% private, all else being equal.
Practices that are actively transitioning — deliberately reducing NHS activity and growing private income — are an interesting valuation case. If the transition is well-managed and evidenced in the financials, buyers may price the future income trajectory into the valuation rather than simply applying the current multiple to the current earnings profile. This requires careful presentation by a specialist adviser.
2026 Market Context
The NHS dental market in 2026 is operating under continued pressure. ICB-level contract reviews, unresolved questions about the future commissioning model, and the ongoing challenge of NHS patient access have contributed to buyer caution around heavily NHS-reliant practices. At the same time, private dentistry has continued to grow, supported by rising patient demand for cosmetic and preventive treatments, and the willingness of patients outside urban centres to pay privately in areas with limited NHS access.
This market context has reinforced the private multiple premium. For principals with a predominantly private or transitioning-to-private practice, 2026 is a favourable moment to exit at a strong multiple. For NHS-heavy practices, the valuation environment is more challenging — but well-run practices with secure contracts and strong UDA delivery records continue to transact.
Frequently Asked Questions
Is an NHS contract an asset or a liability when selling?
It is both, depending on the specifics. A well-delivered NHS contract with a high UDA value and a secure ICB relationship is a genuine asset: it provides a predictable income floor that buyers can rely on. A contract with a history of underdelivery, a below-market UDA rate, or an imminent review is a liability that buyers will price accordingly.
Can I increase my practice’s value by converting from NHS to private before selling?
In principle, yes — but the timing and execution matter enormously. A partial or full conversion that is still in progress at the point of sale introduces uncertainty, and buyers will want to see stabilised financials before committing to a private multiple. A conversion completed two to three years before sale, with the practice operating on a stable private model, will typically be valued more favourably than one mid-transition.
Do DSOs pay more or less for NHS practices than independent buyers?
It varies. Some DSOs have specific NHS contract acquisition strategies and will pay competitively — or even at a premium — for NHS practices in geographic areas where they want to build capacity. Others are focused on the private and mixed market. Independent buyers may be more or less constrained by the same factors, depending on their lender and personal strategy. The right approach is a competitive process that surfaces all relevant buyers for your specific practice model.
What Does This Mean for Your Practice?
The headline answer is: private practices typically fetch higher multiples than NHS practices in the current market, but the absolute value of any practice depends on the underlying EBITDA, the quality and security of the income, and how the practice is presented to the right buyers.
If you are an NHS principal considering an exit, the valuation conversation is more nuanced than the multiple alone suggests. If you are a private principal, the market conditions in 2026 are favourable.
In both cases, understanding the value of your specific practice — with its particular income mix, contract profile, associate structure, and growth trajectory — is the essential first step.
The Business Acquisitions Group specialises in the sale of NHS, private, and mixed dental practices across the UK. We provide a confidential, professionally managed sale process — from valuation and buyer introduction through NHS contract novation to legal completion.
Get a preliminary valuation of your dental practice →
Or speak to a specialist: Contact The Business Acquisitions Group →
Related reading:
- How UK Dental Practices Are Valued in 2026 →
- How to Sell Your Dental Practice: A Step-by-Step Guide →
- How to Prepare Your Dental Practice for Sale →
- How Long Does It Take to Sell a Dental Practice? →
- Should I Sell My Dental Practice to a DSO or an Independent Buyer? →
This article is provided for informational purposes only and does not constitute financial, legal, or professional advice. Always consult qualified advisers before making decisions about the sale of your practice.