The health care sector is one of the biggest sectors in India, is regulated by the Indian Medical Association (IMA). Doctors, apart from engaging themselves in healthcare services by working as doctors and consultants in hospitals, or running their own clinic etc. can do a lot of other activities. For instance, they can set up camps in rural areas, and sometimes are also involved in any nonmedical activities like education etc. Therefore, the taxability depends on what all activities a doctor is involved in. The article below illustrates the same.
Notification No. 9/2017 has exempted healthcare services.
It exempts Health care services by a clinical Establishment or Authorized medical practitioner or para medics.
Let’s see what these terms mean & include:
Health care services implies to improvement and maintenance of physical and mental health. Application of all the health care services in any recognized system of medicines in India except hair transplant, cosmetic surgery or plastic surgery and the ones done due to congenital defects, development abnormalities, trauma or injury are exempt from the ambit of GST.
It includes any hospital, nursing home, maternity clinic, dispensary, clinic, sanatorium, pathology, or any other diagnostic or investigative services owned and controlled by-
Clinical establishments do not include any establishments owned, controlled and managed by the armed forces.
Any practitioner registered with any council of recognized system of medicine or any recognized medical law in India and having a qualification to practice in any recognized system of medicine in India, excluding hair transplant or domestic surgery are exempt from paying GST in India.
Any trained professional such as a nursing staff, physiotherapist, technicians, lab assistant are accountable for their services when provided independently, are therefore exempt.
GST law requires registration on the basis of turnover. It provides a threshold turnover exemption up to Rs 20 lakh from registration.
While determining the turnover for threshold exemption, one has to see the total turnover (exempt + non-exempt)
Let’s see whether doctors would be required to register under GST under the following cases:
Provision of Health care services, as explained earlier, is an exempt service and since the services are exempt, it also exempts from registration. So, the doctors who are engaged only in exempt health care services are providing only exempt services and thus they aren’t required to register under GST.
Non-health care services aren’t exempt under GST. A Doctor providing both health care & non-health care services has to consider the total turnover from health care & non-health care services. Thus, if the total turnover from all services exceeds Rs 20 lakhs, GST registration would be required.
For instance, A doctor is practicing in a hospital with a turnover of 18 lakhs and also selling educational videos online with a turnover of 7 lakhs. Here, while the turnover from practice is 18 lakhs. In order to determine whether GST registration is required, one needs to see the total turnover i.e. turnover from practice + turnover from educational videos, which is this case is 25 lakhs. So, GST registration would be required.
Once you have registered yourself under GST whether voluntarily or compulsory, it is mandatory to file your GST Return. If you fail to do so, you would be liable for some penalty.
A registered dealer has to file a GST Return that includes-
A registered person has to file GSTR 3B monthly and GSTR-1 quarterly (for turnover up to 1.5 crores)
A GST registered doctor has to report both the exempt & non-exempt turnover in the return and special care has to be given while availing input credit as credits owing to exempt services won’t be available.
Disclaimer: The above post is only for the purpose of academic discussion and should not be construed as any legal opinion in any matter whatsoever.
The author is a CA in practice at Delhi and can be contacted at: E-mail: [email protected], Mobile: +91-9811741451