Most psychological services do not incur the 10% goods and services tax (GST). Generally, psychological services are GST-free if provided to an individual or group by a registered private practitioner. See below for a general guide to services that are GST-free and services that incur GST.

The Australian Taxation Office (ATO) has stated that to be GST-free, a psychological service must be “generally accepted” by the profession as being necessary for “appropriate treatment”. Appropriate treatment is considered assessment of the client’s state of health and pursuing a process to attempt to preserve, restore or improve the client’s physical or psychological wellbeing.

For professional and specific advice on the GST contact:

  • a tax accountant
  • the ATO on 13 24 78
  • the APS National Office on 03 8662 3300 or 1800 333 497 (toll free)

Generally GST-free services include:

  • Group sessions; if the individual is first assessed and it is determined that a group session is “appropriate treatment”.
  • Psychotherapy and hypnotherapy, if provided by a psychologist and considered “appropriate treatment”.
  • Goods, such as written material and tapes, supplied for a particular patient as part of treatment. This must be supplied at the same time and place as the service delivery, be customised for the patient and used as part of the same treatment.
  • Services provided by trainee psychologists, as long as they are done so under the supervision of a registered psychologist.
  • Studies and supervision required for registration as a psychologist.

Generally services that attract GST include:

  • Professional development.
  • Training in dealing with different client conditions. Education and training will generally attract GST, as it is not providing an ‘appropriate treatment’.
  • Psychological reports for third parties, such as expert witness and medico-legal reports. But the consultation time spent on assessing a patient for a report is GST-free if the report is predominantly for the purpose of ‘appropriate treatment’.
  • Buying or developing psychological tests and other professional instruments. But time spent assessing a client for a condition that exists in DSM-IV is GST-free.
  • Contractor’s services to an agency that supplies GST-free patient services. For example, when a psychologist is contracted to the hospital that supplies the service to the patient, the contract charges to the hospital attract a GST.

Exceptions may occur depending on the circumstances.