Canada: Health care professionals; GST/HST liability

GST/HST liability of Canadian health care providers

Health care professionals whose primary business involves making exempt supplies may not have considered whether there is a secondary activity that could require registration and accounting for goods and services tax / harmonized sales tax (GST/HST) on certain sales of good and services. In general, this registration requirement applies to a person that makes taxable supplies that exceed the CAD $30,000 “small supplier” threshold. Failure to collect and remit the appropriate amount of GST/HST on these supplies could expose health care professionals to significant tax, interest and penalty assessments from the Canada Revenue Agency.

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While many services provided by health care professionals are exempt for purposes of the GST/HST, not all services qualify. For example, certain administrative and managerial services are generally considered GST/HST taxable supplies. These types of services may include scheduling and oversight responsibilities for a particular department, a teaching assignment, or consulting on a board or panel.

 

Read an August 2015 report prepared by the KPMG member firm in Canada: Health Care Professionals May Have Surprise GST/HST Obligations

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