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Health services that are not medical services are GST-free if they are:

• a listed health service (see Which health services are eligible?)

• performed by a recognised health professional (see Who is a recognised health professional?)

• accepted in the relevant health profession as necessary and appropriate to treat the patient or recipient of the service (see What is appropriate treatment?).

 

This fact sheet only covers health services. For information about the GST treatment of medical services, refer to GST and medical services .

 

Which health services are eligible?

For a health service (that is not a medical service) to be GST-free, it must be one of the following:

• an Aboriginal or Torres Strait Islander health service

• acupuncture

• audiology or audiometry

• chiropody

• chiropractic

• dental

• dietary

• herbal medicine (including traditional Chinese herbal medicine)

• naturopathy

• nursing

• occupational therapy

• optometry

• osteopathy

• paramedical

• pharmacy

• psychology

• physiotherapy

• podiatry

• speech pathology

• speech therapy

• social work.

 

The services must be one of the listed services and cannot just be similar to one of these services.

 

Who is a recognised health professional?

 

 

A recognised professional is a person who is registered, permitted or approved under state or territory law to provide the listed health service.

If there is no relevant state or territory law, a recognised professional is a member of a professional association that:

• relates to the health service

• has the same registration requirements nationally.

 

For audiology or audiometry, the service must be provided by an accredited service provider under section 4 of the Hearing Services Administration Act 1997.

 

What if an assistant provides the service?

 

If part of the health service is performed by an assistant and not the recognised health professional, it is included as part of the GST-free service if all of the following apply:

• it is billed in the name of the recognised health professional and they accept full responsibility for the health service

• it is part of the health service that the recognised health professional provides

• the recognised health professional has been involved in at least part of that health service

• the recognised health professional supervises the assistant directly by

  • attending to the patient at the start of each treatment

  • being readily available for the whole time the assistant works with the patient

  • being available to take appropriate action if there is an emergency

  • planning all the treatment the assistant provides

  • being able to provide evidence that they monitor the assistant's services.

• have access to a professional library – for example, journals, newsletters or technical updates

• be able to take part in decision-making that affects your profession – for example, to promote, encourage and develop the profession

• have the right to vote at the association's meetings

• be a recognised member of that professional association.

 

Are you a member of a professional association?

 

As a member of a professional association, you normally need to meet specified admission criteria and:

• have access to a professional library – for example, journals, newsletters or technical updates

• be able to take part in decision-making that affects your profession – for example, to promote, encourage and develop the profession

• have the right to vote at the association's meetings

• be a recognised member of that professional association.

 

What is a professional association?

 

A professional association normally has the following characteristics:

• its members practise in the association's listed profession

• it sets its own admission requirements, including acceptable qualifications

• it sets standards of practice and ethical conduct

• it aims to maintain the standing of the profession as a whole, and often prescribes requirements for maintaining its members' professional skills and knowledge through continuing professional development

• it has sufficient membership to be considered representative, but not necessarily solely representative, of the listed profession

• it is a non-profit body

• it has articles of association, by-laws or codes of conduct for its members

• it can impose sanctions on members who break the association's rules.

 

What are uniform national registration requirements?

 

Uniform national registration requirements mean your professional association's registration requirements are the same in all states and territories.

Professional associations set the requirements and make sure that only suitably qualified people gain professional practitioner status.

 

Example: Not a member of a professional association

Nijah runs a naturopathy practice in Brisbane. She is not a member of a professional association representing naturopaths.

 

Nijah cannot provide GST-free services because:

• there is no state or territory regulation covering naturopathy registration

• she is not a member of a professional association.

 

Example: Non-national professional association

Evelyn is a herbalist and a member of a Northern Territory-based herbalist association with its own registration requirements.

 

As Evelyn is a member of a Territory-only based association, she is not a recognised professional and consequently her service is subject to GST unless she becomes a member of a nationally-based professional association.

 

Example: Not representative of the profession

Leroy is a specialist in a form of naturopathy and a member of a nationally-based professional association representing the specialist subgroup. The professional association has 15 members and all the practitioners of this specialist subgroup of naturopathy are members of this association.

With just 15 members, it is unlikely that the association would be considered representative of the naturopathy profession as a whole. As a member of this association, Leroy is not a recognised professional and cannot provide his services GST-free.

 

What is appropriate treatment?

 

For GST purposes, a recognised health professional provides appropriate treatment if they:

• assess a patient's health

• work out a course of action to preserve, restore or improve the patient's physical or psychological wellbeing as far as their training allows

• supply a treatment that is generally accepted by their profession as being appropriate for the patient.

Appropriate treatment includes further treatments and preventative medicine.

 

What if the service is provided under a multi-party arrangement with a third party?

 

From 1 July 2012, where a supply of a health service made to an individual is a GST-free supply of health services, that supply will also be GST-free where the recipient of the supply is:

• an insurer settling a claim under an insurance policy

• an operator of a statutory compensation scheme

• an operator of a compulsory third party scheme

• an Australian government agency.

 

Sometimes, health related services are provided to patients under multi-party arrangements that are organised and paid for by a third party.

 

Where the third party is an insurer, an operator of a statutory compensation scheme or compulsory third party scheme (scheme operator), or an Australian government agency, the practitioner may make a supply to both the patient and the third party.

 

From 1 July 2012, where a supply is made to the insurer, the scheme operator or the Australian government agency, the supply is GST-free to the extent that the underlying supply of health services to the patient is GST-free.

 

Example 1: GST-free supplies to a third party

ABC Health Fund has a pre-existing agreement with a physiotherapist for services supplied to settle claims made under their insurance policies. The agreement outlines what both parties need to do when the physiotherapist treats an ABC Health Fund member. It also outlines that ABC Health Fund must pay the physiotherapist for their services to the private health member, as well as the authorisation required for such payments.

 

Peter has private health insurance with ABC Health Fund. Peter has an injury that requires physiotherapy so he contacts ABC Health Fund who refer him to the physiotherapist. The physiotherapist is a recognised professional and the service is generally accepted in the physiotherapy profession as necessary and appropriate for Peter's treatment. Therefore, the supply of the physiotherapy health service is a GST-free supply.

 

Under this arrangement, the payment to the physiotherapist is for the supply made to ABC Health Fund of physiotherapy services to Peter.

 

The supply to ABC Health Fund will be GST-free because the underlying supply of physiotherapy services made by the physiotherapist to Peter is a GST-free health service.

End of example

 

Where a supply is not made to a third party (for example, the third party is merely paying the health practitioner on behalf of the patient), the supply of the health service is GST-free to the patient where the service is:

• a listed health service

• performed by a recognised health professional

• accepted in the relevant health profession as necessary and appropriate to treat the recipient of the service.

 

What if the service is not provided to an insurer, scheme operator or government agency?

 

Where a third party other than an insurer, a scheme operator or an Australian government agency is the recipient of the supply of a health practitioner's services, the health service will not be GST-free.

 

 

Are goods supplied as part of health services GST-free?

 

 

Except when supplied by optometrists, pharmacists, naturopaths or herbal medicine practitioners (including traditional Chinese herbal practitioners), goods supplied by a health professional as part of a GST-free health service, are GST-free if they are:

 

• supplied to the patient at the same time as the GST-free health service

• individually customised or manipulated for treating that particular patient's illness or disability

• essential for treating that patient during that particular consultation.

 

Example 2: supply of goods to a patient

Leah is a registered nurse who treats a patient's injury during a consultation by applying a bandage. The consultation is GST-free and the bandage is also GST-free.

End of example

 

Goods supplied to a person in the course of supplying optometry or pharmacy services may be GST-free under other provisions, such as GST-free medical aids or appliances or GST-free drugs and medicinal preparations.

 

Herbal medicine practitioner or a naturopath

 

If you are a herbal medicine practitioner or a naturopath, goods you supply during a consultation are only GST-free if they are completely used or consumed during the GST-free consultation.

If the goods are only partially used or consumed during the consultation at the premises, only the used portion is GST-free.

 

Chinese herbal medicine you supply with GST-free acupuncture

 

If you registered to provide acupuncture and traditional Chinese medicine, a herbal medicine preparation you supply is GST-free if all of the following apply:

 

• you supply it at the same premises where you supply the GST-free service

• it is individually customised or manipulated for treating that particular patient's illness or disability

• it is generally accepted in the acupuncture profession as being necessary for the appropriate treatment of the patient.

 

The patient does not have to consume the herbal medicine preparation at the acupuncturist's rooms for it to be GST-free.

 

Chinese herbal medicine practitioner

 

If you are a registered Chinese herbal medicine practitioner, a Chinese herbal medicine preparation you supply during a GST-free consultation is also GST-free if it is completely consumed during the consultation.

If the medicine is only partially consumed during the consultation at the premises, only the consumed portion is GST-free.

 

Recognised professional in acupuncture and Chinese herbal medicine

 

You may be a recognised professional in more than one service listed in the GST Act and may be supplying a combination of services.

For example, when a recognised professional in both acupuncture and traditional Chinese herbal medicine supplies a patient with a herbal preparation, the preparation is GST-free if you supply it at the premises where you supplied the GST-free treatment.

 

Chinese herbs and GST

 

Chinese herbs you supply as medicinal herbs are not considered to be GST-free food. For the purposes of the GST Act, the definition of food includes beverages (and ingredients for beverages) that are primarily consumed for the purposes of increasing bodily liquid levels, to quench thirst or to give pleasure. It does not cover beverages or ingredients for beverages that are primarily consumed for medicinal or therapeutic purposes.

 

Chinese dried herbs that can be food or medicine

 

In general, medicinal herbs are taxable imports because they are not GST-free food.

 

However there are a small number of Chinese dried herbs that are generally used as food, or as an ingredient for food, as well as for medicinal or therapeutic purposes.

 

Common examples of food herbs are lotus seeds, red dates, longan fruit, tangerine peel, sweet almond seeds and jasmine tea leaves. The supply of these foods or ingredients for food is GST-free, although they may have medicinal or therapeutic purposes. When you import them as food or ingredients for food, they are a non-taxable import.

 

Chinese herbs are not GST-free where:

• dried herbal ingredients you use in medicinal decoctions (solutions made by boiling herbs in water) are not considered to be ingredients for food or beverages

• medicinal dried herbs that you consume in soup or other food are not considered to be ingredients for that soup or other food

• herbs you provide as part of a herbal formula/prescription

• herbal goods in tablet or capsule form are not food

• where the overseas exporter specifically labels and markets dried herbs as medicinal herbs

• where you are in Australia and specifically label and market dried herbs as being medicinal herbs.

 

Chinese herbs are GST-free where:

• the overseas exporter supplies herbs (that are accepted as food or ingredients for food or beverages as well as for medicinal purposes) and indicates that the herbs are food or ingredients for food

• you are in Australia and you supply the herbs (that are accepted as food or ingredients for food or beverages as well as for medicinal purposes) and market them as food or ingredients for food.

 

Is massage therapy GST-free?

 

If you supply massage therapy alone, it is not GST-free because it is not listed as other health services in the GST Act.

 

However, you can supply massage therapy GST-free if:

• you supply it as part of a listed complementary health service

• you are a recognised professional in one of the listed complementary health services who is also trained in massage therapy

• the listed complementary health service profession considers the massage to be a standard technique or component treatment for that listed complementary health service

• the listed complementary health service profession accepts it as being necessary for the appropriate treatment of the patient.

 

Massage therapy may also form part of some other GST-free services, for example, physiotherapy.