Is chiropractic GST exempt and what it means for your practice
Key takeaways
- Chiropractic services provided to a patient are exempt from GST and HST under the health-care rules.
- Because the services are exempt, you generally cannot claim input tax credits to recover the GST you pay on rent, equipment, and supplies used to provide care.
- If your clinic sells taxable products such as orthotics, supplements, or pillows, that side of the business may be taxable and needs its own GST treatment.
- Service income and product income are analyzed separately for GST purposes.
The exemption under the Excise Tax Act
Chiropractic services are GST and HST exempt under section 7 of Part II of Schedule V to the Excise Tax Act. That means you do not charge GST or HST on adjustments, consultations, reassessments, or any treatment provided to a patient.
Because the service is exempt, you generally do not register for GST on that stream of income. But the exemption also means you cannot claim input tax credits to recover the GST you pay on expenses related to providing chiropractic care.
The input tax credit problem
Input tax credits let a registered business recover the GST it pays on business expenses. A chiropractor who provides only exempt services cannot register voluntarily and cannot claim ITCs. That means the GST on clinic rent, equipment like chiropractic tables, therapy supplies, and practice management software is a permanent cost.
This is different from a dentist, who charges GST on most services and can claim ITCs on related expenses. A chiropractor simply absorbs the GST on expenses as a cost of doing business.
What about taxable side-sales
If your clinic sells products such as orthotics, supplements, pillows, or other goods that are not health-care services, those sales are generally taxable. The GST treatment depends on whether the product is a prescription item or an over-the-counter sale.
| Revenue stream | GST status | Can claim ITCs on related expenses? |
|---|---|---|
| Chiropractic adjustments | Exempt | No |
| Supplement sales | Taxable (unless prescription) | Yes, on applicable expenses |
| Orthotics (custom) | May be taxable | Depends on classification |
| Pillows, braces | Taxable | Yes |
How to handle mixed GST status
If your clinic has both exempt service income and taxable product income, you are in a mixed-supply situation. You need to track expenses that relate to each stream separately. Expenses related purely to chiropractic care (like treatment room rent) cannot claim ITCs. Expenses related purely to product sales (like inventory purchases) can claim ITCs.
Overhead expenses that support both streams, like office rent and utilities, are apportioned between exempt and taxable use. The CRA-accepted methods include square footage allocation or time-spent allocation.
Why this matters: the GST rules for chiropractic are the opposite of what most business owners expect. You do not charge tax on treatments, but you also cannot recover the tax you pay. If you have a product business on the side, the two sides need separate GST treatment and separate record keeping.
Frequently asked questions
Do I need to register for GST as a chiropractor?
No, because the services are exempt. You generally cannot register voluntarily unless you have taxable supplies like product sales that exceed the $30,000 small-supplier threshold.
Can I charge GST on chiropractic services if I want to?
No. Exempt supplies cannot be made taxable by choice. The law says chiropractic services are exempt, and you cannot opt to charge GST on them.
If I sell products, do I register for GST on those sales only?
Yes. If your product sales alone cross the $30,000 small-supplier threshold, you must register for GST on the taxable product sales. The chiropractic service income stays exempt.
What happens if I do not separate exempt and taxable income correctly?
CRA may reassess your GST returns and deny ITCs claimed on exempt-service expenses, plus charge interest and penalties. Proper allocation is essential.
Does the exemption apply to all provinces?
Chiropractic services are GST/HST exempt across Canada. Some provinces have their own provincial sales tax rules that may apply to product sales differently.
Talk to us about your GST position at ghumans.ca/chiropractors.
General information only. Talk to us about your situation.