Professional indemnity insurance for Dentists

Clarke McEwan Accountants

Today's dentists operate in a far more litigious environment than they did in past decades. So it's crucial that your professional indemnity insurance affords you adequate and appropriate cover for your full scope of practice, say experts.

Like all health professionals, dentists now operate in an increasingly litigious environment. Nearly one in 10 dental practitioners will face a lawsuit in their professional lifetime, and one in 20 will be slugged with a regulatory complaint or matter in any given year. So it's crucial that dentists' professional indemnity insurance (PII) covers them for the full scope of their practice and that its limits enable them to mount a proper defense, should they wind up in court or face regulatory action.

Why dentists need PII

According to the Dental Board of Australia, PII refers to a policy or arrangements "that secure for the practitioner's professional practice insurance against civil liability incurred by, or loss arising from, a claim … made as a result of a negligent act, error or omission in the conduct of the practitioner".

"Having PII is a legal requirement, part of your registration," explains Dr Hugo Sachs, Australian Dental Association federal president. "It covers you for the actual procedural events that occur in a dental surgery, so anything from restorative work to tooth removals.

"PII also ensures members of the community that if something untoward occurs in their [dental] treatment, the provider of that service is indemnified, and therefore they will be recompensed."

Craig Hockley, head of marketing at Guild Insurance-the ADA's preferred insurer in NSW, Victoria, Tasmania and SA-says having comprehensive PII cover isn't just mandatory; it's a necessity.

"Twelve years ago, around one in 30 dentists experienced the stress of a professional indemnity claim; today, it's closer to one in 10," Hockley says. "Not only has the incidence of claims increased, so has the cost. Without professional indemnity insurance, dentists risk losing their business and personal assets."

Clive Levinthal, CEO of Experien Insurance Services, agent for Australia's largest indemnity insurer, Vero, notes that dentists' need for PII cover has increased with changes in the regulatory environment. "Historically, the main concern for dentists was civil claims, and that's still a high risk. But [as] regulatory bodies have become … easier for consumers to access, regulatory cases have spiked: in 2016-17, these increased by around 30 per cent year on year."

Regulatory cases run the gamut, Levinthal says, from complaints about quality of work done, "say, in putting on veneers, to failing to exercise 'reasonable care and judgement' during a filling or extraction that failed, or the dentist having inadequate skills to do work such as implants or orthodontics" to allegations of poor infection-control measures, inappropriate behaviour and threats to patient safety.

"It could come from anyone-a patient, current or former staff member or the regulators themselves, following an audit of compliance practices or allegations made by a third party," he says.

And even competent, careful dentists can be at risk, cautions Dr Sachs. "No-one's immune-there are some scurrilous claims," he says. "And in general, the more complicated the treatment, the higher the risk. Which is why you have professional indemnity insurance: it's there to help both patient and practitioner."

Registration standard

Under Section 129 of the Health Practitioner Regulation National Law, a registered health practitioner can engage in his or her profession only if "adequate and appropriate" PII arrangements are in force.

"No-one's immune-there are some scurrilous claims. And in general, the more complicated the treatment, the higher the risk. Which is why you have professional indemnity insurance: it's there to help both patient and practitioner."-Dr Hugo Sachs, president, Australian Dental Association

All dental practitioners except those with student or non-practising registration must be covered by PII that meets the minimum terms and conditions outlined in the DBA's Indemnity Insurance Registration Standard.

Whether direct or third-party, your PII cover must include civil liability cover, appropriate retroactive cover; and automatic reinstatement, dictates the DBA.

Civil liability cover pays for any legal expenses you incur defending or settling a civil claim, plus any damages. Retroactive cover means PII arrangements covering you against claims arising from procedures undertaken prior to the start of the policy, while automatic reinstatement means the limit of indemnity (amount insured) is reinstated for new, unrelated claims even after claims have been paid to the indemnity's limit.

If you work under third-party PII that doesn't meet this standard, you'll need to take out additional cover. Ditto if you intend to practise outside the scope of your employer's PII-say, through additional study or volunteer work

Moreover, under the DBA's registration standard, 'practice' isn't restricted to direct clinical care; it includes "using professional knowledge in a direct non-clinical relationship with clients… and [in any roles] that impact on safe, effective delivery of services in the profession".

Practice owners should take out practice entity cover in addition to their individual PII, advises Levinthal. "Though it's not mandatory, it's recommended, especially if they employ other dentists. Because if one of those associate dentists makes a mistake, litigation … can be brought on both the individual treating dentist and the practice that employed that dentist."

The same could apply to an assistant's error, he notes. "So if you're the owner and employ staff, ensure you're covered for mistakes they may make."

Full scope of practice

In line with the National Law, the DBA sets out "broad scope-of-practice requirements for the different types of dental practitioners, rather than specific activities", explains the Board spokesperson. "Practitioners are expected to practise safely and within the limits of their competency, training and expertise.

"In all cases, dental practitioners need to assess whether their PII is adequate, given the area/s of practice they work in, their professional experience, the risks involved in their practice and any previous insurance claims made against them," says the spokesperson.

"All dental practitioners must declare if they meet the Board's standard on PII when they apply to renew their registration. The Australian Health Practitioner Regulation Agency audits practitioners at random to ensure they meet … registration standards. Any practitioner who cannot produce evidence demonstrating that they're covered by appropriate PII may have action taken against them."

While most APRA-approved insurers take a 'full scope of practice' approach to PII for dental practitioners, not all policies are equal, asserts Levinthal.

"It's important a practitioner pays close attention to these details as well as any limits of cover the policy may extend."-Craig Hockley, head of marketing,

Guild Insurance

"We don't nitpick and charge additional premiums for general dentists who, say, do implants or orthodontics-our policy covers for everything they're registered to practise," he explains. "There are different premium bands, however. So a part-time dentist can opt to pay less. And while there's no discount for not practising particular treatments, choosing certain excesses lowers your premium."

Hockley notes that while some insurers "dictate the number of hours a week a practitioner can work or limit the number of hours they can spend on specific treatments, Guild's dental PII policy's written in such a way that if the DBA says you're able to do it, you're covered".

That said, loadings are applied to general dentists intending to undertake implants and/or orthodontics, Hockley says, because audits show "there's a greater risk to those two procedures".

For general dentists, taking out a full-scope-of-practice PII policy is a simple way to ensure you're covered in any eventuality, says Dr Sachs. "If you don't, and you're not paying the add-ons-which, for orthodontics and implants, [can] attract a significant loading-you can't legally practise these procedures. And without 'full scope of practice' cover, dentists who've had repetitive misadventures can find their insurer says, 'We'll no longer insure you for that'."

Read the fine print

When weighing up various PII options-and before you sign-read the fine print, experts caution. "It's important a practitioner pays close attention to these details, as well as any limits of cover the policy may extend," says Hockley.

PII providers offer anything from $100,000 to $500,000 for defending regulatory matters, and typically between $10 million and $20 million for civil claims. "It's certainly worth shopping around," Levinthal stresses.

Hockley, however, contends that with PII, price correlates directly with the service you receive. "Just because another insurer's premiums are cheaper doesn't mean it's like for like," he says.

"Nine out of 10 of our customers who've made a claim go on to recommend us to a colleague. While we're close to it, we don't pretend to be the cheapest: we aim to be the best, and to be there when you need us. Dentists pay, on average, $2500 a year-claims can be millions. There's a distinct possibility that if you're not properly covered, you can lose your livelihood."

Failing to note changes to the fine print could also prove costly.

For example, the 2012 amendment applied to many Australian health practitioners' PII policies, excluding from coverage anyone using 'therapeutic goods' not registered under our TGA-designed to discourage dentists from using cheap unregistered imports that could be harmful to patients-entailed an apparently 'minor' alteration to the fine print. Ignoring this crucial amendment could, potentially, have cost a practice or practitioner millions-enough to render them bankrupt, with their professional reputations damaged irreparably.

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Prepare for Payday Super: Key Readiness Steps for Employers

By Clarke McEwan • March 30, 2026

From 1 July 2026, the way you pay your employees’ super is changing. Instead of making quarterly super payments to your employees’ funds, contributions will essentially need to be paid at the same time as salary and wages. ‘Payday Super’ marks a significant change for employers. To make sure your business isn’t caught out, make sure you’ve taken the following readiness steps, in line with ATO guidance . Understand the new requirements Under the new regime, super guarantee payments must reach your employees’ super funds within seven business days of payday, though longer deadlines apply in some cases, such as for new employees. The amount of contribution is calculated as 12% of an employee’s ‘qualifying earnings’ – a new term that incorporates and expands on the previous concept of ordinary time earnings. If contributions are not made on time, in full and to the correct fund, the super guarantee charge (SGC) may apply. Plan your transition The ATO recommends that employers do the work now to plan and prepare for Payday Super. This includes: - Deciding when, exactly, your business will move to Payday Super (noting early adoption is perfectly fine). - Reviewing your cash flow position, to make sure your business can cope with a shift away from quarterly to ‘real-time’ super payments. - Checking your current payroll and business processes, such as confirming that super fund details for all eligible employees are up-to-date and complete. Lock in plans Once your business has determined when it will start using Payday Super, the next step is to make sure all relevant systems are ready for the change. That includes the payroll software you use, as well as any clearing houses or super fund portals you may use to make super guarantee contributions. For any businesses that use the Small Business Superannuation Clearing House (SBSCH), remember that it will close permanently from 1 July 2026 as part of the Payday Super reforms. Finally, take the time to troubleshoot any potential issues that might arise once Payday Super is live. For example, your business may need to implement a process quickly to correct any errors that might arise when paying employees’ super contributions. Remember, from 1 July 2026… …Payday Super is mandatory. Any businesses that do not adapt to the new rules and continue to pay super quarterly run the risk of being on the receiving end of compliance action by the ATO. If your business needs help preparing for Payday Super, feel free to reach out to a member of our team. We can walk you through the requirements of the new legislation and troubleshoot any potential pitfalls well ahead of 1 July.

Top 10 Tax Deductions for Doctors and Medical Practitioners in Australia

By Clarke McEwan • March 27, 2026

Top 10 Tax Deductions for Doctors and Medical Practitioners in Australia Medical practitioners in Australia often face complex tax obligations due to high incomes, multiple work locations, and ongoing professional expenses. Understanding which tax deductions are legitimately available can make a significant difference to your after‑tax position—while remaining fully compliant with Australian Taxation Office (ATO) requirements. Below are ten common tax deductions that doctors, specialists, locums, and medical practice owners should review each financial year. 1. Medical Equipment and Professional Tools Medical equipment and tools used for work purposes—such as stethoscopes, diagnostic tools, surgical instruments, and medical bags—are generally tax‑deductible. Lower‑cost items may be claimed immediately, while higher‑value equipment typically needs to be depreciated over its effective life. Depending on the timing and structure of purchase, tax depreciation concessions may allow accelerated deductions. 2. Work‑Related Motor Vehicle Expenses If you travel between multiple work locations, such as hospitals, clinics, private rooms, or patient home visits, you may be entitled to claim motor vehicle expenses. The ATO allows claims using either the logbook method or the cents‑per‑kilometre method. Travel between home and your primary workplace is generally not deductible unless you are a locum or considered genuinely itinerant. 3. Continuing Professional Development (CPD) and Education Expenses incurred to maintain or improve your existing medical skills are usually deductible. This can include CPD course fees, professional conferences, seminars, and approved training programs. Where there is a clear professional purpose, reasonable travel and accommodation costs associated with education may also be deductible, including for interstate or overseas conferences. 4. Professional Memberships and Registration Fees Registration and subscription costs that are necessary for you to practise medicine are generally tax‑deductible. These may include AHPRA registration fees, medical college memberships, medical association subscriptions, and medical indemnity insurance premiums. 5. Home Office Expenses Many doctors perform administrative duties, telehealth consultations, research, or practice management tasks from home. In these cases, a portion of home office expenses may be claimable, such as electricity, internet, phone usage, and office equipment. Claims must be supported by accurate records and reasonably apportioned between work and private use. 6. Income Protection Insurance Premiums for personally held income protection insurance are generally tax‑deductible for medical practitioners. Life insurance, total and permanent disability (TPD), and trauma insurance premiums are not deductible when held personally, although different rules may apply when insurance is held within superannuation. 7. Technology and Software Expenses Doctors can usually claim deductions for work‑related technology, including laptops, tablets, mobile phones, practice management systems, medical software, and accounting or billing platforms. If an asset is used partly for personal purposes, the expense must be apportioned accordingly. 8. Uniforms, Scrubs, and Laundry Branded uniforms and occupation‑specific clothing such as scrubs are deductible, as are associated laundry and cleaning costs. Conventional clothing, even if only worn at work, is not deductible under ATO guidelines. 9. Interest on Business and Equipment Loans Interest on loans used for income‑producing purposes is generally tax‑deductible. This includes loans for medical equipment, practice fit‑outs, business acquisitions, and certain leasing or finance arrangements. Only the interest portion of repayments is deductible, not the principal. 10. Personal Superannuation Contributions Medical practitioners may be eligible to claim tax deductions for personal superannuation contributions made in addition to employer contributions, subject to concessional contribution caps. A valid Notice of Intent to Claim a Deduction must be lodged with the super fund within the required timeframes. ATO Compliance Considerations Doctors are considered higher‑risk taxpayers due to income levels and deduction profiles. Claims should always be conservative, well‑documented, and clearly linked to the generation of assessable income. Professional advice from an accountant experienced in the medical sector can help ensure compliance while optimising legitimate tax outcomes. Specialist Advice for Medical Practitioners Clarke McEwan Chartered Accountants advises GPs, specialists, locums, and medical practice owners across Queensland and Australia. Our services include medical‑specific tax planning, structuring, compliance, and long‑term wealth strategies. If you would like a review of your tax position or guidance on your deductions, a confidential consultation is available. Book a time with us here Book Initial No Obligation Consultation at Clarke McEwan for all new medical clients.

Keeping Your Self-Managed Super Fund Compliant

By Clarke McEwan • March 8, 2026

Keeping Your Self-Managed Super Fund Compliant

ATO Update on Inherited Homes: What it Means for Your Family’s Wealth

By Clarke McEwan • March 8, 2026

The ATO has issued a Draft Taxation Determination TD 2026/D1 which looks at how inherited family homes are treated for CGT purposes. Some industry commentators have dubbed it a “death tax by stealth”, but it is a bit more complex than this. The draft guidance focuses on a specific aspect of the rules around applying the main residence exemption to inherited properties, potentially exposing deceased estates and beneficiaries to significant tax if not planned correctly. Here’s what you need to know in practical terms. Why TD 2026/D1 Matters Under current law, deceased estates or beneficiaries can potentially sell a deceased individual’s former family home without paying CGT if certain conditions can be met. This exemption is particularly valuable for properties owned long-term, where unrealised gains could be substantial. In order to access a full exemption you normally need to ensure that the property is sold within 2 years of the date of death (but the ATO can potentially extend this deadline) or that the property has been the main residence of certain qualifying individuals from the date of death until the property is sold. These qualifying individuals can include the surviving spouse of the deceased individual, the beneficiary selling an interest in the property or someone who has a right to occupy the dwelling under the deceased’s will. The draft ATO guidance focuses on this last point. That is, what does it mean for someone to have “a right to occupy the dwelling under the deceased’s will.” In summary, the ATO’s view is that: The right to live in the home must be explicitly granted in the will to a named individual. Broad discretionary powers given to trustees, separate agreements, or even testamentary trusts (TTs) are not sufficient in the ATO’s view. For example: A will giving an executor discretion to allow a family member to occupy the home does not meet this requirement. A trustee of a TT who allows a beneficiary to live in the house is seen as separate from the will and may trigger CGT on sale. Some legal and real estate experts warn this could force families to sell homes within two years of death to avoid CGT, especially in high-value areas. Consider this: inheriting a $2 million home with a capital gain of $1.5 million could expose the beneficiaries to $300,000–$600,000 in tax, depending on discounts and tax brackets. However, it is important to remember that there are still other ways for the sale of the property to qualify for a full exemption. Practical Steps to Protect Your Estate While we are waiting for the ATO to finalise its guidance in this area, there are steps you can take to protect your family’s assets: Review and update your will, especially if you are planning to provide certain individuals with the right to occupy a property. Does the will currently provide this right to specifically named beneficiaries? Plan the timing of sales – The two-year exemption window remains, but if you inherit a property and intend to hold it longer than this, weigh any potential CGT exposure against future rental income or family needs. Partial CGT exemptions might still apply, but the rules and calculations can be complex. Seek professional advice, especially if your estate plan uses TTs. You will normally need to work closely with tax and legal advisors to structure the plan appropriately. Be market aware – Estate planning can intersect with market timing. Quick sales may preserve CGT exemptions, but this needs to be weighed up against non-tax factors. The key takeaway is clear: estate planning is a complex area and needs to be navigated carefully to preserve family wealth and avoid unintended tax implications.

Navigating CGT on Your Home: New ATO Clarity for Home-Based Businesses

By Clarke McEwan • March 8, 2026

Running a business from home—whether as a sole trader, freelancer, or small operator—has many perks. But when it comes to selling your home and potentially saving on tax, recent guidance from the ATO serves as a reality check. The ATO has provided its views on how home-based businesses interact with the small business capital gains tax (CGT) concessions, providing a warning on how the ATO approaches a long-standing area of confusion. See: Home-based business and CGT implications | Australian Taxation Office The Key Issue: Active Asset Test When an individual sells their main residence, they will often enjoy a full CGT exemption. However, if part of the home is used for business purposes, this can potentially impact on the scope of the exemption. If a full exemption isn’t available under the main residence rules then we typically look to other CGT concessions, including the CGT discount for assets that have been held for more than 12 months or the small business CGT concessions. The small business CGT concessions can potentially reduce or eliminate a capital gain made on sale of a property, but only if certain conditions are passed. One of the key conditions is that the property must pass an active asset test. In very broad terms, to pass the active asset test you need to show that the property has been actively used in a business activity for at least 7.5 years across the ownership period or for at least half of the ownership period. The ATO is clear: the active asset test applies to the entire property, not just the business portion. When you are applying the active asset test, an asset either passes this test or fails it. It is not really possible for an asset to partially pass the active asset test. The entire property is either an active asset or it is not. Simply having a home office, workshop, or even being able to claim home occupancy expenses as a deduction does not necessarily make your home an active asset. Where business use is incidental to the home’s primary residential purpose, the ATO’s view is that the small business CGT concessions generally do not apply. Rus v FCT The view that the entire property must qualify as an active asset—and that incidental or minor business use (such as a home office or storage in a largely residential setting) is insufficient—draws support from case law, particularly the Administrative Appeals Tribunal (AAT) decision in Rus and Commissioner of Taxation [2018] AATA 1854 (Rus v FCT). In that case, a taxpayer sought access to the small business CGT concessions on the sale of a 16-hectare largely vacant rural property, where only a small portion (less than 10% by area) was used for business purposes: a home office, shed for storing tools/equipment/vehicles, and related supplies tied to a plastering and construction business operated through a controlled company. The balance of the land remained vacant or used residentially. The AAT upheld the ATO's ruling that the property as a whole did not satisfy the active asset test, reasoning that the business activities were not sufficiently integral to the asset overall. Minor or incidental use did not make the entire property an active asset, especially where the business was primarily conducted off-site. This precedent reinforces the ATO's strict approach in home-based business scenarios: the property is assessed holistically. This means that limited business use typically fails to tip the scales toward qualifying for the concessions. Practical Examples Let’s take a look at how the ATO approaches some common scenarios. Minor home-based business: Harriet runs a hairdressing salon in a spare room, using 7% of the total floor space of the property and seeing clients eight hours a week. She claims deductions for occupancy expenses and gets a 93% main residence exemption. However, because her business use is minor, she cannot access small business CGT concessions. The 50% CGT discount can still apply. Significant business use: Sue and Rob own a two-storey building, with the ground floor operating as a takeaway store (50% of the total floor area of the property) and the top floor as their private residence. The business has been running for decades with employees. Here, the property qualifies as an active asset, potentially giving them access to the small business CGT concessions for the portion of the capital gain that isn’t covered by the main residence exemption. What This Means for You A partial main residence exemption doesn’t necessarily mean you have access to the small business CGT concessions. Many homeowners mistakenly assume that business deductions or a home office automatically open the door. The ATO clearly doesn’t share this view. Seek advice before changing the way your home will be used. Starting to operate a business from home can impact on deductions, CGT calculations and access to CGT concessions. We are here to help you make fully informed decisions. Keep thorough records. Floor plans, hours of business use, and detailed deductions can help strengthen your position and may help in any future planning or audits. Consult your accountant. If selling your home is on the horizon, professional advice is critical to assess any potential CGT exposure and explore concessions that might be available. The Bottom Line The ATO’s updated guidance suggests that many home-based business owners won’t have access to the small business CGT concessions on sale of their home, but this always depends on the facts. Business owners need to plan proactively, rather than assume that tax relief will be available. By understanding how your home’s business use is treated, you can make smarter decisions. For example, will the profits generated from a small business operated at home end up being wiped out by a higher CGT liability on sale of the property down the track? After all, when it comes to CGT, every dollar you keep counts toward your next venture or your retirement nest egg.

DPN Review: A Wake-Up Call for Business Owners on Personal Tax Risks

By Clarke McEwan • March 8, 2026

Running a successful business is hard work—and sometimes, despite best intentions, tax obligations slip. If the business is being operated through a company structure, then the ATO can potentially issue a Director Penalty Notice (DPN), holding company directors personally liable for unpaid taxes. In 2024–25, DPNs skyrocketed by 136%, reaching over 84,000 notices, affecting directors of around 64,000 companies. The stakes are high, and now the Tax Ombudsman is reviewing how the ATO issues and manages these notices—a development all directors should take seriously. So, what exactly is a DPN? Put simply, if your company fails to pay certain taxes—like PAYG withholding, GST, or Superannuation Guarantee Charge (SGC)—the ATO can target directors personally. There are two types: Non-lockdown DPNs: These apply if the company has lodged its activity statements or SGC statements but hasn’t made the relevant payments. In this case directors have 21 days to take appropriate action, such as arranging for payment of the debt, appointing an administrator, or entering liquidation. Acting promptly may allow the penalty to be remitted. Lockdown DPNs: These apply if reporting deadlines are missed as well. In this scenario directors can’t avoid personal liability by putting the company into administration or liquidation. The intent is to protect government revenue and employee entitlements—but for directors, the impact can be severe. Why the Ombudsman is Involved The review, announced in December 2025 by Tax Ombudsman Ruth Owen, responds to a surge in complaints, with DPNs topping the list. It will examine: How effectively the ATO uses DPNs to recover debts ($54.2 billion in collectable amounts by mid-2025) The fairness of selecting cases for enforcement How directors are notified and communicated with Treatment of vulnerable directors, including those coerced into roles or facing financial abuse The review also aligns with broader government initiatives, including support for gender-based violence survivors and more empathetic engagement with business owners. While timelines are flexible due to resources, the review is part of the 2025–26 work plan, alongside assessments of ATO services for agents, First Nations engagement, and interest charge remissions. Commercial Takeaways for Directors DPNs are more than a compliance issue—they’re a real commercial risk. Ignoring a notice can disrupt personal finances, damage credit ratings, and even trigger bankruptcy. At the same time, the Ombudsman review could improve transparency and fairness, giving directors a clearer understanding of options if financial stress arises. Practical steps to protect yourself now Stay on top of obligations: make sure the company lodges returns and pays liabilities on time. Lodge statements even if payment isn’t possible: Failing to lodge activity statements just makes things worse. Consider using ATO payment plans if cash flow is tight but remember that this won’t necessarily enable directors to escape personal liability if a DPN has been issued already. Monitor company cash flow and tax health closely, especially during economic dips. Act fast if you receive a DPN: Consult immediately your accountant or lawyer to explore options because strict deadlines might apply. Consider director insurance or business structuring to limit personal exposure—but compliance always comes first. The Ombudsman’s review is a timely reminder: tax is a key business risk, not just paperwork. Being informed, proactive, and prepared can protect both your business and your personal assets. If you’re concerned about DPN exposure, reach out for a tailored review—we can help you stay ahead of risk, so your business thrives rather than just survives.