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Medical, dental, physiotherapy, chiropractic, psychology, massage, and wellness clinics each face a unique set of financial rules — especially around GST/HST exemptions, associate arrangements, and payroll. We understand clinic finances and handle the complexity so you can focus on patient care.
What Clinic Owners Deal With
GST/HST Exemption Rules
Some health services are GST/HST-exempt; others are fully taxable. Applying the wrong treatment creates either unreported liabilities or unnecessary compliance costs — and the rules vary by service type and province.
Associate Arrangements
Associates who rent chairs, share revenue, or work on contract create complex employment vs. contractor classification questions. The wrong treatment triggers payroll assessments from the CRA.
Mixed Revenue Streams
Clinic income often combines insurance billings, direct billing, cash payments, and retail product sales — each with different tax treatment. Without proper tracking, year-end becomes a nightmare.
Services for Clinics
Monthly Bookkeeping
Insurance billings, private pay, product sales, and associate fees tracked separately each month. Know exactly where your revenue comes from and where your money goes.
Payroll & T4s
Full-time staff, part-time practitioners, and administrative team — all payroll processed accurately every cycle with correct CPP, EI, and income tax deductions.
GST/HST Filings
We identify your exempt vs. taxable services, ensure correct charging and claiming of input tax credits, and file returns on time. No surprises from the CRA.
Year-End Support
Year-end close with working papers for your CPA. Equipment CCA schedules, prepaid expenses, and accrued liabilities all handled correctly.
Corporate Tax Support
Books prepared to the standard your accountant needs for the T2. Professional corporation rules followed correctly — especially important for regulated health professionals.
CRA Support
GST/HST audits and payroll reviews are common in healthcare. We handle CRA correspondence professionally and provide documentation to resolve issues quickly.
Clinic Questions — Answered
Many health services are exempt — including most medical, dental, physiotherapy, and psychology services provided by a licensed practitioner. However, some services like massage therapy, aesthetic treatments, and certain wellness services are taxable. The rules are complex and vary by province. We identify exactly which of your services are exempt versus taxable and ensure your filings reflect the correct treatment.
Associate arrangements vary widely. Some are employees; others are independent contractors. The CRA looks closely at these arrangements — getting the classification wrong can trigger payroll assessments. We document the financial relationship correctly and ensure T4s or T4As are issued as required.
Yes. Equipment is a capital asset depreciated via Capital Cost Allowance (CCA). In some cases, immediate expensing rules allow deducting the full cost in the year of purchase. We ensure equipment purchases are classified correctly and that you claim the maximum deduction available.
We track insurance billings (direct billing to insurers like RAMQ, Blue Cross, or Sun Life) separately from private pay income. This gives you a clear revenue breakdown and ensures all taxable services are correctly identified and reported — which is essential when your services span both exempt and taxable categories.
Generally, no. Most healthcare services — physician, dentist, physiotherapy, chiropractic, psychology, and others provided by a licensed practitioner — are GST/HST exempt under the Excise Tax Act. This means you don't charge HST to patients, but you also cannot claim ITCs on your business inputs (supplies, rent, equipment). However, some ancillary services are taxable: cosmetic procedures, retail product sales (skincare, supplements), and massage therapy in certain provinces, for example. If your clinic has this mixed-use situation, only the inputs attributable to taxable activities qualify for ITCs — and the allocation must be documented methodically. We set up this tracking from the start so you're never caught off guard.
Yes, provided your clinic is a Canadian-Controlled Private Corporation (CCPC) earning active business income. The federal Small Business Deduction reduces your corporate tax rate to 9% on the first $500,000 of net active business income per year — a significant advantage over the general corporate rate of approximately 15% federally. Some provinces have additional restrictions for professional corporations (PC) depending on the regulated profession and province: for example, Quebec medical corporations have specific rules under the Medical Act. We review your eligibility and structure as part of year-end planning to ensure you're capturing the full benefit.
Useful Articles for Clinic Owners
GST/HST Registration: Do You Need to Register?
Once your revenue hits $30,000, registration isn't optional. Here's how the threshold works and when to act.
Sole Proprietor vs. Corporation: Which Is Better for You?
Tax rates, liability, costs, and when the $80–100K income threshold makes incorporation worth it.
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