Running a pharmacy is not like running a typical small business. NHS income arrives through the Drug Tariff and is calculated per item dispensed, with fees and adjustments that change month to month, alongside private and over-the-counter retail sales taxed at the standard rate. Add in locum pharmacist costs, stock that needs to be valued accurately at year end, and payroll for a mix of full-time and part-time staff, and generic bookkeeping quickly falls short. That’s why independent pharmacy owners across Lancashire and the North West work with accountants for pharmacies who already understand NHS contract income from day one.
We cover all the financial and compliance work an independent pharmacy needs to keep its numbers accurate and its cash flow predictable.
We track all your income including NHS payments, private sales and over-the-counter retail, and match it against your costs each month so you always know where you stand financially.
Pharmacies deal with a mixture of VAT-exempt NHS income and standard-rated retail sales. We make sure your VAT return reflects this correctly every quarter, so you are never overpaying or underpaying.
Whether you have two members of staff or twenty, plus locum pharmacist cover, we run payroll each month, handle all HMRC submissions and make sure everyone is paid correctly and on time.
We prepare your annual accounts and tax return, making sure your stock is valued correctly, all allowable costs are claimed, and your tax bill is as low as it legitimately can be.
We give you a clear view of where your money is going each month, which services and product lines are most profitable, and where there is room to improve your margins.
We manage all your deadlines and make sure every submission is accurate and on time. You will never face a late filing penalty because something was overlooked.
Monthly or quarterly updates so you always know your profit position, not just a figure once a year
NHS income, private sales and retail kept separate so your VAT and profitability figures are always accurate
All deadlines managed for you so nothing is ever missed or filed late
Someone to call when a stock valuation, locum cost or NHS payment query comes up
We work with you throughout the year, not just when a deadline is due.
NHS income comes in through the Drug Tariff and is calculated based on the number of items dispensed, the fees attached to each item, and various adjustments that change month to month. On top of that you have retail sales with different VAT treatments, locum costs to manage, stock that needs to be counted and valued at year end, and a payroll that often includes part-time staff on different pay rates.
If your accountant is not familiar with this, errors creep in. VAT gets miscalculated. Stock is valued incorrectly. NHS income ends up in the wrong place on your accounts. None of these are catastrophic on their own, but they add up, and they can result in you either paying too much tax or falling short of what HMRC expects.
Something we often see: pharmacy owners who have been with a general accountant for years and are paying more tax than they need to, simply because pharmacy-specific costs and allowances have not been claimed correctly. A review of your last two or three years of accounts can often identify significant savings.
Getting this right from the start also means you always know your true profit position, rather than finding out at year end that dispensing volumes or retail margins were not what you thought.
Beyond bookkeeping and VAT, this is where a specialist accountant earns their fee.
NHS Drug Tariff income reconciliation, so dispensing fees, category M adjustments and monthly price changes are tracked accurately against what is actually paid.
Stock valuation support at year end, so your accounts reflect the true value of dispensed and retail stock on hand.
Locum pharmacist cost tracking and IR35 considerations, so payments are recorded correctly and compliantly.
Cash flow forecasting that accounts for the gap between dispensing activity and NHS payment timing.
Advice on structuring the business, including partnership and limited company options, as your pharmacy grows or you plan for succession.
Our pharmacy packages start at £225/month for an independent pharmacy doing up to £500k turnover, including year-end accounts, corporation tax, quarterly VAT, monthly bookkeeping and management accounts. Pharmacies running multiple branches, employing locum cover regularly, or needing more detailed stock and margin reporting typically sit in the £400–£900/month range. Fixed fee, no hourly surprises.
Yes. We reconcile dispensing volumes, item fees and monthly Category M and other price adjustments against what the NHS actually pays, so your income is recorded accurately rather than just taken from the bank statement.
Yes. We separate VAT-exempt NHS dispensing income from standard-rated retail and over-the-counter sales, so your VAT return is correct every quarter and you are never over- or under-paying.
We track locum invoices and payments separately from permanent payroll, apply the correct tax treatment, and factor locum cover costs into your monthly profit and cash flow picture.
Xero as the core ledger, linked to your PMR dispensing system reports where possible so dispensing income reconciles cleanly each month. If you’re on spreadsheets and want to modernise, we handle the migration end-to-end, usually within a few weeks.
We handle the whole process, including writing to your current accountant and transferring records, so it takes very little of your time. Most pharmacies are fully switched over within two to four weeks.
Yes. R&R is regulated by the Association of Chartered Certified Accountants (ACCA). All work is signed off by an ACCA-qualified accountant.
Our head office is in Blackburn, and we work with independent pharmacies in Preston, Burnley, Accrington, Chorley, Leyland, Bolton, Wigan, Bury and Manchester. Being cloud-based means location barely matters — most of our pharmacy clients never need to set foot in the office — but face-to-face meetings are available at our Blackburn office when you want them.
Related specialities: Accountants for healthcare professionals · Accountants for doctors · Accountants for locums · VAT returns & MTD · Cloud bookkeeping
Book a free consultation. We’ll review your last VAT return, your NHS income reconciliation and your stock valuation approach, and give you three concrete things to change — whether or not you switch to us. Call 01254 839543 or book online.
Expert Chartered Certified Accountants helping North West businesses protect and grow their income.
Friendly support from a local team that understands your business. Book your free consultation today and take the first step towards financial clarity and peace of mind.
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74 St James Road, Blackburn, BB1 8ET
We work with clients in Blackburn and across the North West, so you can get support wherever you are.
