Templates
Naturopathy chart of accounts for Xero
Naturopathy is a listed health service, so a consult by a recognised professional that the profession accepts as appropriate treatment is GST free. The dispensary is separate. Herbs and supplements are GST free only where they are completely used or consumed during that consultation, so a bottle taken home is taxable. A naturopathy chart keeps them apart: one GST free consult account, one taxable products account.
Key facts
- Where naturopathy sits
- On the ATO's list of other health services, alongside herbal medicine including traditional Chinese herbal medicine1
- What makes the consult GST free
- Three conditions together: a listed service, a recognised health professional in that service, and treatment the profession accepts as necessary for the person receiving it1
- How a naturopath is recognised
- No state or territory law registers naturopathy, so recognition runs through membership of a professional association with the same registration requirements nationally1
- Goods used up in the consultation
- GST free where they are completely used or consumed during a consultation that is itself GST free2
- Goods only partly used
- Only the used portion is GST free, so the take home portion carries GST2
- The consult account in the allied health template
- 400 Clinical services, private patients, at the GST Free Income rate in Xero5
- The dispensary account in the allied health template
- 422 Products and equipment sales, at the GST on Income rate in Xero5
- The Schedule 3 door
- A product listed in Schedule 3 to the GST Act or the GST regulations, designed for people with an illness or disability and not widely used by people without one, is GST free on that footing3
- Chinese herbs
- Herbs supplied as medicines are not GST free food; herbs accepted, labelled and marketed as food or food ingredients are2
What a naturopathy chart has to separate
Most chart of accounts advice for allied health stops at one line: consults are GST free, products are taxable. For a naturopath that line is close enough to be misleading, because the ATO wrote a separate paragraph for goods a naturopath hands over, and it does not turn on whether the item looks like retail stock. It turns on whether the preparation was used up in the room.
So the chart has three jobs, and a single revenue account does none of them.
- Hold the consultation on its own account at the GST free rate, which depends on the practitioner being a recognised professional rather than on the appointment type.
- Hold the dispensary on its own account at the taxable rate, so the take home bottle is not swept into the consult.
- Leave room for the lines that are taxable in every profession: a report somebody else asked for, a workshop, a treatment room let to another practitioner.
The consult account, and the test under it
Naturopathy is on the ATO's list of other health services, and so is herbal medicine including traditional Chinese herbal medicine. Being on the list is one of three conditions rather than the answer on its own.
Health services that are not defined as medical services, are GST-free, if all the following apply: it is a listed health service; the service is performed by a recognised health professional in that listed health service or, under certain circumstances, their assistant; the service is generally accepted in that listed health profession as being necessary for the appropriate treatment of the recipient of the supply.1
The second condition carries more weight in naturopathy than in most of the list, because there is no state or territory law registering naturopaths. Where no such law exists, a recognised professional is a member of a professional association whose registration requirements are the same in every state and territory, and which is representative of the profession. The ATO's two worked examples on association membership are both naturopaths: one belongs to no association and cannot supply GST free services, and one belongs to a specialist association of 15 members, which the ATO reads as unlikely to be representative of naturopathy as a whole.
That is worth settling before the chart goes into Xero, because account 400 in the allied health template assumes it. The account's own note asks the practice to confirm which of its services are on the listed service list before the GST free default is applied to anything.
The dispensary, and the rule written for it
The general goods rule is the one most practices are given. Goods are GST free where they are a necessary part of providing the GST free service and supplied at the same time and place, and where they are specific to treating that person's illness or essential to that consultation. The ATO's own example is a bandage applied during a consultation, which follows the consultation, against the extra bandages the patient takes home, which do not.
Herbal medicine practitioners, Chinese herbal medicine practitioners and naturopaths get their own paragraph, and it is narrower than the general rule rather than wider.
Goods supplied during a GST-free consultation by a recognised professional herbal medicine practitioner, Chinese herbal medicine practitioner or a naturopath are GST-free if they are completely used or consumed during a consultation that is GST-free. If the goods are only partially used or consumed during the consultation at the premises, only the used portion is GST-free.2
- A tincture made up and taken during the appointment is used up in the room, so it follows the consultation.
- A bottle dispensed and taken away is not used up in the room, so it sits with the taxable products line.
- A preparation partly taken on the premises is split, and only the used portion follows the consultation.
A practitioner recognised in both acupuncture and traditional Chinese herbal medicine reads a different sentence again. The ATO says a herbal preparation supplied at the premises where the GST free treatment was provided is GST free, and the patient does not have to consume the whole preparation during the consultation.
The profession's own association tells its members the same narrow reading, which is a sign of how often the wide one turns up in practice.
Goods supplied by a herbal medicine practitioner or a naturopath during a consultation is GST-free only if it is completely used or consumed during the consultation.4
Where a dispensary line lands in the templates
The two canonical templates that carry a private product row post it taxable, and they put it in different places: the allied health template at 422 Products and equipment sales, the psychology template at its own products account. The plan managed NDIS template carries no private product row at all, so the same line falls through to the private consult row and posts at the GST free rate. A practice that started from that template without adding a products row would have its dispensary sitting in its clinical income.
Ledger Map shows each template as it posts rather than averaging them, because a merged code is one that no template holds. A naturopathy practice starts from the allied health template, so its standing map carries that template's accounts.
The rows a naturopathy map carries
A chart of accounts on its own does not decide anything. What decides is the standing rule that sends a billed line to an account and a tax rate, and the rules a naturopathy practice needs are few. Four cover most weeks: the consult, the dispensary, a report and a workshop. Each row below is resolved through the same cascade the product runs, so it is what the map would post rather than a description of what it should.
A line with a category of its own outranks the funder's default, which is why the dispensary posts taxable while the client's consult in the same appointment stays GST free. One invoice with two rates takes that ordering in full.
The accounts a naturopathy practice opens first
The allied health template carries a wide chart because it is built for a practice billing Medicare, DVA, NDIS and insurers. A naturopathy practice bills almost all of it privately, so most of those accounts stay empty and five do the work.
| Account | Xero tax rate | What lands there |
|---|---|---|
| 400 Clinical services, private patients | GST Free Income | The consultation itself, initial and follow up |
| 422 Products and equipment sales | GST on Income | The dispensary: herbs, tinctures and supplements the client takes away |
| 420 Reports, assessments and medico-legal | GST on Income | A report or an assessment somebody other than the client asked for |
| 421 Supervision, training and workshops | GST on Income | Workshops, talks and supervising another practitioner |
| 460 Other income, room rental and admin fees | GST on Income | A treatment room let to another practitioner, and admin fees |
Setting it up in Xero
The mechanics are ordinary. What matters is that the split survives contact with the booking system, because that is where a dispensary line is written before it ever reaches the ledger.
- Create the revenue accounts in Xero with the tax rate on the account, so a line coded to the dispensary account carries the taxable rate without anyone choosing it per invoice.
- Give the dispensary its own product or item codes in the booking system, separate from appointment types, so the invoice line arrives already labelled.
- Set an item level override for any Schedule 3 medical aid the practice stocks, rather than moving the whole account.
- Decide how a partly used preparation is written up, because it is two lines on one invoice rather than one line at a blended rate.
- Take the practice's own listed service and association position to its BAS agent before the first activity statement, since the consult account depends on it.
What it costs to get wrong
A dispensary swept into the consult account understates GST on sales. The practice either charged GST it did not report, or did not charge it and owes the one eleventh out of its own margin, and going back to a client months later for the difference is rarely worth doing.
The error runs the other way too. A practice that codes its whole book taxable because the dispensary is taxable remits GST on consultations that were GST free, and getting that back takes an amended activity statement. Both come from the same place: one tax rate applied to a book that needs two. Products and equipment covers the goods test itself, and private patient consults covers the treatment side.
What Ledger Map does with it
Ledger Map holds one standing map for the practice, approved before anything syncs. A billed line resolves through that map to the account and the tax rate the practice's template carries, a client's card settlement is posted as one balanced document set, and one exact match is left in the bank feed. A line the map cannot resolve becomes a question with the options laid out rather than a quiet posting.
The accounts and rates on this page come from the canonical template the practice starts from, not from a treatment the product chose. The practice approves the map first, and the full template carries every row this page leaves out.
Questions
Is naturopathy GST free in Australia?
Naturopathy is one of the listed health services, so a consult can be GST free, but three conditions have to hold together: the service is on the list, it is performed by a recognised health professional in that service, and it is generally accepted in the profession as necessary for the appropriate treatment of the person receiving it.
Do naturopaths charge GST on herbs and supplements?
On the ATO's reading, goods a naturopath supplies during a GST free consultation are GST free only where they are completely used or consumed during that consultation. A bottle the client takes home has not been, so it carries GST. Where a preparation is only partly used on the premises, only the used portion is GST free.
What account does the dispensary go to in Xero?
In the allied health canonical template, a product line posts to 422 Products and equipment sales at the GST on Income rate, separate from 400 Clinical services, private patients, which sits at GST Free Income. Putting the tax rate on the account means the invoice line does not need anyone to choose a rate.
Does association membership decide whether my services are GST free?
It is how the recognised professional condition is met where no state or territory law registers the service, which is the case for naturopathy. The association has to have the same registration requirements nationally and be representative of the profession. The ATO gives two naturopathy examples where that fails and no threshold, so it is a question for the practice and its BAS agent.
Are Chinese herbs GST free?
It depends on what they are supplied as. Herbs supplied as medicines, in a formula or prescription, in tablet or capsule form, or labelled and marketed as medicinal, are not GST free food. Herbs accepted as food or ingredients for food, and labelled and marketed that way, are GST free as food.
Read next
Sources
Open questions
- No cached search results exist for this page's target query, so the page has not been checked against what currently ranks or against what an answer engine says today. The comparison in the brief rests on the neighbouring queries read in the same session, and what this page adds is stated as what it does rather than as a claim about competing pages.
- Whether a particular practitioner is a recognised professional turns on the association's national registration requirements and on whether it is representative of the profession. The ATO gives two naturopathy examples where the test fails and states no threshold, so the page states the test and leaves the answer with the practice and its BAS agent.
- The ATO says only the used portion of a partly consumed preparation is GST free and gives no method for measuring the portion, so how a practice splits that line is left open.
- Supervision is taxable by default in the canonical template, and the research behind it records an ATO interpretative snippet pointing the other way for one fact pattern. It is left open here rather than settled.
- Whether any private health fund still pays a benefit on naturopathy, and how that would be posted, was not researched for this page.
- Every ato.gov.au page refuses an automated fetch. A direct fetch of the goods page on 3 Sep 2026 returned HTTP 403, so the ATO wording above was read through a signed-in browser on that date and a reader checking it will need to open the pages the same way.
- GST and health: other health services
Australian Taxation Office. Retrieved 3 Sep 2026. Source updated 12 Jun 2024.
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- GST and health: goods supplied as part of a GST-free health service
Australian Taxation Office. Retrieved 3 Sep 2026. Source updated 12 Jun 2024.
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- GST and health: medical aids and appliances
Australian Taxation Office. Retrieved 3 Sep 2026. Source updated 8 Oct 2025.
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- Allied health, revenue by funding source, the canonical template
Ledger Map. Retrieved 3 Sep 2026.
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Review
Last reviewed 3 Sep 2026 by Shane
General information for Australian allied health practices, not tax advice. Confirm a treatment with your BAS agent or accountant before you post it.
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