Setting Up a Private Medical Practice? Here’s Your Financial Checklist (UK)

“Thinking about going private — but worried you'll miss a regulation, under-price a clinic, or pay the wrong tax? This checklist de-risks your launch.”

Consultants and private GPs planning (or accelerating) a private practice in Greater Manchester, Bolton, or elsewhere in the UK. If you want clarity on registrations, pricing, insurer recognition, VAT/tax and cash flow — this is for you.

1) Is private practice viable — in your patch?

The test: Can you list three referral sources and three high-demand services patients will actually pay for? If not, research before you register.

Payor mix: self-pay vs insured. Self-pay grows when wait times rise; insured work needs recognition (see Section 5).

Room strategy: renting sessional rooms inside a private hospital gets you practising privileges and theatre access; community clinics can lower costs but demand your own compliance processes.

Try this (5-minute check):

• List top 5 procedures/consultations you'll offer.
• Mark each SP (self-pay) or INS (insured).
• For SP, look at 3 competitor websites and note initial/follow-up fees.
• For INS, list target insurers (AXA, Bupa, Aviva, Vitality, WPA).

2) What must you register for — and when?

CQC (Care Quality Commission)

If you provide a regulated activity in England (e.g., treatment of disease, surgical procedures, diagnostic & screening, etc.), you must register before you start or you risk committing an offence. Check the CQC “regulated activities” list and scope guidance to decide if registration applies to you. Care Quality Commission+1

ICO (Information Commissioner's Office)

Most practices controlling patient records must pay the annual data protection fee (bands by size/turnover). Use the ICO self-assessment and “what you need to do” pages to confirm your tier and whether any exemption applies. ICO+2ICO+2

Professional indemnity/insurance

You're responsible for having adequate and appropriate indemnity in place for your scope of practice; the GMC can refuse or remove a licence if you don't. GMC UK+2GMC UK+2
Try this: Start your CQC decision by listing your services against the CQC regulated activities page; if any match, pencil in 6–12 weeks for registration lead time and evidence prep. Care Quality Commission

3) Choose the right business vehicle

• Sole trader: quicker set-up, simpler admin; income taxed at personal rates.
• Limited company: can be tax-efficient at higher profits; gives limited liability; adds payroll, director compliance, and corporation tax.
• Pension planning: company contributions can be efficient; model this with your expected drawings.

Decision path (rule of thumb):

• Expected profit under ~£60–80k and you want simplicity? Start sole trader.
• Target profit >£100k and you'll reinvest? Model a company.

4) VAT & tax — clarity on exemptions and grey areas

Most clinical care by registered health professionals is VAT-exempt when the primary purpose is the protection, maintenance or restoration of health. Cosmetic or purely aesthetic services may be taxable; mixed-purpose appointments require careful analysis and documentation. See HMRC VAT Notice 701/57 and the VAT Health Manual for scope and examples. GOV.UK+2GOV.UK+2

Practical safeguards

• Keep clear clinical notes stating therapeutic purpose when claiming exemption.
• For mixed lists (e.g., dermatology with aesthetic add-ons), create distinct SKUs and invoices.
• Monitor VAT threshold (if you have taxable income streams) and prepare early if you'll register.

5) Getting paid — insurer recognition, PPR & self-pay pricing

Insurer recognition (AXA, Bupa, etc.)

• Build your PPR (Private Practice Register) profile — insurers and hospitals use it to verify details and speed up recognition. healthcode.co.uk+1
• Apply to insurers: AXA Health individual recognition and Bupa recognition outline criteria, fees and billing principles.
• Many providers explicitly ask you to as part of recognition steps.

Self-pay pricing

• Anchor prices with local competitors.
• Show transparent bundles (initial + follow-up).
• Reinvest early proceeds in reputation assets (patient comms, outcomes data).

6) Your first-year budget & break-even (numbers you can trust)

Typical start-ups costs (indicative ranges)

• Room hire/session or clinic lease
• Medical defence (specialty-dependent)
• Practice management software (PMS), secure messaging, e-billing
• Medical secretary/virtual PA
• Website, booking, basic PPC, professional photography
• Equipment & disposables (lean to start; rent where possible)

Back-of-envelope break-even:

1. Add up fixed monthly costs.
2. Add variable cost per consult/procedure.
3. Break-even volume = Fixed ÷ (Average fee - Variable).
4. Add a 15% buffer for no-shows and insurer shortfalls.

7) Systems & people — build for compliance and cash

• PMS features to insist on: e-invoicing (Healthcode), card payments, automated reminders, CCSD codes, insurer fee tables, ICD/SNOMED mapping.
• Secretarial support: start virtual; scale to in-person as lists grow.
• CQC evidence discipline: keep SOPs, audits, training logs in one place — that reduces inspection stress later. (See CQC service-type quick guides.) Care Quality Commission
• Data protection: publish a privacy notice, map processing, set retention schedules; renew ICO fee annually. ICO

8) 90-day launch plan & KPIs

Weeks 1–2

• Decide services & locations; CQC need check; start ICO self-assessment; firm up indemnity.
• Choose structure; open business bank; bookkeeping stack. (We can help set this up.)

Weeks 3–6

• Build PPR profile; apply to insurers (AXA, Bupa).
• Launch website pages for key clinics; set initial fees; switch on bookings.

Weeks 7–12

• First clinics live; measure enquiry-to-booking %, DNA rate, Days Sales Outstanding (DSO).
• Adjust pricing; tighten cash collection; prep CQC evidence if required.

North-star KPIs (Quarter 1):

• 30+ new patient enquiries, 60–70% conversion
• DSO < 21 days; insurer rejection rate < 3%
• Gross margin per session trending up for 3 consecutive weeks

9) Maintain compliance, protect profit

• Renewals: ICO fee (annual), indemnity, PMS licences; keep CQC statements of purpose current. ICOCare Quality Commission
• Insurer hygiene: review fee schedules, coding accuracy, and respond quickly to audits/queries via portals.
• Quarterly finance reviews: VAT position (if mixed supplies), dividend vs salary (if Ltd), pricing adjustments.

In short, setting up a private medical practice is completely achievable when you follow a clear path: confirm demand, tick off registrations, price confidently, secure insurer recognition, get VAT/tax right, and track a handful of weekly KPIs. If you'd like a specialist partner by your side, YRF Accountants provides Healthcare Accounting and Financial Services tailored to private GPs and consultants—covering business structure, VAT decisions, insurer billing workflows, cashflow forecasting, and ongoing compliance—so you can focus on patient care while your numbers work as hard as you do.

FAQ

Do I always need CQC registration?

If you'll perform regulated activities in England (for example, treatment of disease, diagnostic & screening, surgical procedures), you must register before providing them. Check the official list and scope guidance.

Do I need to pay the ICO data protection fee?

Most practices that control patient data must pay an annual fee (tiered by size). Confirm with the ICO's self-assessment.

Is my service VAT-exempt?

Many clinical services by registered professionals are exempt if the primary purpose is medical care. Cosmetic-only services can be taxable; mixed-purpose needs careful documentation. Check HMRC VAT Notice 701/57. GOV.UK

How do I become recognised by insurers?

Create/complete your PPR profile (Healthcode) and apply to each insurer (e.g., AXA Health, Bupa) following their criteria and fee agreements.