Which income accounts does a speech pathology practice need in Xero?

Enough to keep each payer apart, and each taxable line type apart from the therapy beside it. The canonical NDIS provider template ships fifteen: a listed and a non listed account for each of the three NDIS management types, private clients, other third party payers, then reports, training, cancellations, travel and non face to face time, group programs and other income.

Is speech pathology GST free?

Speech pathology and speech therapy are both named in the ATO's list of health services, so the first of three conditions is settled. The other two still have to hold: the hour is performed by a recognised professional in that listed service, and the profession generally accepts it as necessary for the appropriate treatment of the recipient of the supply.

Is a school or preschool contract for speech pathology GST free?

It turns on who engaged the practice. Where a school engages the practice, the recipient of the supply is the school rather than the child, and the ATO says supplies of services to another business are not usually GST free. The four payers that keep a service GST free are an insurer, a statutory compensation scheme operator, a compulsory third party scheme operator and an Australian Government agency. Whether a particular school falls inside that last limb is a question for the practice's BAS agent, and this page does not settle it.

Where does a report written for a school post?

That depends on the funding source the invoice carries. Billed to a private family or on a plan managed NDIS invoice, the template sends a report to account 420 at GST on Income. Billed under the other third party funder, no category row exists, so it falls to that funder's default at account 407 and lands with the therapy instead. A practice with school work adds the row rather than leaving the default to answer.

Templates

Speech pathology chart of accounts

A speech pathology chart splits revenue by who engaged the practice, then by what the line is. Therapy by a recognised practitioner is a listed health service, so a session posts GST free whether a family, a plan manager or the NDIA pays for it. A school that engaged the practice is a different recipient, and the other third party default sends its reports and sessions to one account.

Key facts

Where speech pathology sits: Speech pathology and speech therapy are both named in the closed list of health services, so the first of the ATO's three conditions is settled for the therapy itself¹
The two conditions still to hold: The hour is performed by a recognised health professional in that listed service, and the profession generally accepts it as necessary for the appropriate treatment of the recipient of the supply¹
Who the recipient of the supply is: Whoever engages the practitioner to provide the service, which is usually the patient and in some cases a business²
A supply to another business: Not usually GST free, which is the sentence a school, preschool or employer contract runs into²
The third parties a GST free service stays GST free for: An insurer, an operator of a statutory compensation scheme, a compulsory third party scheme operator, and an Australian Government agency³
Where a plan manager sits: Under normal circumstances a supply of NDIS supports is made to the participant rather than to the plan manager, so a plan managed invoice does not move the recipient⁴
Revenue accounts in the template: Fifteen, ordered by funding source first and then by what the line is, so one funder can carry more than one tax rate⁵
What other third party payers post to: Account 407 at GST Free Income, reached as the funding source default, because the shipped rows spell out no category under that funder⁵
Where a report posts: Account 420 at GST on Income where the line is billed to a private family or on a plan managed NDIS invoice, which is a different account from the session it followed⁵

A speech pathology chart answers one question first: who engaged the practice

One speech pathologist can spend a week seeing a plan managed participant, a private family, and a preschool that bought a block of sessions. The therapy is the same in all three. What changes is who engaged the practice, and that is what decides the account, the tax rate and the wait for the money.

Bookkeeping for a speech pathology or allied health group practice is mostly about reconciling money that arrives in bulk against work delivered one session at a time. NDIS batches, Medicare deposits, health fund payments and private fees all land differently and carry different GST and reporting rules.⁶

A chart built around clinicians answers none of that. A chart built around who paid answers most of it, and the second cut answers the rest: a session and a report do not share a tax rate, and neither shares an account with a workshop.

The ATO's list names speech pathology and speech therapy separately

Most professions appear once in the closed list of health services. This one appears twice, as speech pathology and as speech therapy, which takes the naming argument off the table before it starts. The ATO adds that a service must be one of the listed services and cannot just be similar to one of them, so the list settles it.

It is a listed health service. Speech pathology is on the list, and so is speech therapy.
It is performed by a recognised health professional in that listed health service, or under certain circumstances their assistant.
The profession generally accepts it as necessary for the appropriate treatment of the recipient of the supply.
Who pays is not one of the three, which is why a private session and an NDIS session share a rate and not an account.

Speech pathology sits in the first condition, which is why this page spends its time on the third. That test names a recipient, and on a speech caseload the recipient is not always the person in the room. Is NDIS income GST free runs the argument in full.

The recipient of the supply is whoever engaged the practitioner

The ATO states it plainly: the recipient of the supply is whoever engages the health practitioner to provide the service, usually the patient and in some cases a business, and supplies of services by a health practitioner to another business are not usually GST free. A parent booking sessions engages the practice. A school signing a term contract engages the practice too, and it is not a patient.

A narrow set of third parties escapes that. Where the service would be GST free supplied to the patient, it stays GST free when the practice contracts with one of four payers.

An insurer.
An operator of a statutory compensation scheme.
A compulsory third party scheme operator.
An Australian Government agency.
Separately, a payer who settles on the patient's behalf, such as a plan manager, leaves the supply with the participant.

A school is not an insurer and not a scheme. Whether a state school, a Catholic school or an independent preschool sits inside the government agency limb is a question this page does not settle, and it is the question that decides the account. Third party payers sets out the test itself.

What the template posts, payer by payer

Six payers, resolved through the product's own cascade rather than read out of the file by hand. Five behave the way a speech practice expects. The sixth is the one to look at twice.

Who engaged the practice, and what the NDIS provider template posts for them⁵

Who engaged the practice	Funding source on the invoice	Account in the template	Xero tax rate
A parent or carer who books and pays the practice	Private	400 Clinical services, private patients	GST Free Income
A participant whose plan manager settles the invoice	NDIS plan managed	403 NDIS plan-managed, listed supports	GST Free Income
A participant whose claims the NDIA pays in a batch	NDIS agency managed	401 NDIS agency-managed, listed supports	GST Free Income
A participant paying out of their own plan funds	NDIS self managed	405 NDIS self-managed, listed supports	GST Free Income
An insurer or a scheme operator paying for a client's therapy	Other third party	407 Clinical services, other third-party payers	GST Free Income
A school or preschool buying a block of sessions	Other third party	407 Clinical services, other third-party payers	GST Free Income

The last two rows are one row as far as the shipped template is concerned. Other third party is a single funding source with a single default, built for the insurer and scheme arrangements that stay GST free under the third party rules. A school contract arrives at the same door, and that default is a row to look at rather than an answer.

One caseload, four rows of the standing map

Plate 1Four payers on one caseload. Three sessions resolve at one rate, and the report line resolves to an account and a rate of its own.

Three of the four rows resolve at the funding source level, which is the cascade saying that nothing more specific was written for them. Only the report row was spelled out, and it is the only one of the four that carries a different rate. That pattern is what happens to a school report.

The row a practice with school work has to decide

Bill a report to a private family or on a plan managed NDIS invoice and the template sends it to account 420 at the standard rate, because a category row was written for it. Those are the only two funders the shipped rows give a report row, so a report billed to a school under the other third party funder falls to that funder's default and posts to account 407 at GST Free Income alongside the therapy.

That is the template behaving as written rather than a fault in it. Other third party was drawn for insurers and scheme operators. A school buying a block of sessions is a different arrangement, and the chart cannot tell the two apart until the practice says so.

Reports, workshops and groups, the lines that move on their own

Three kinds of work on a speech caseload do not follow the session beside them. Each has an account in the chart already, and each is worth opening before the first one is invoiced.

420 Reports, assessments and progress notes for third parties, for an assessment or a written report another organisation asked for. Reports and medico-legal work covers the treatment, and NDIS report writing covers the plan funded case the templates leave open.
421 Training and capacity-building workshops, for a professional development session delivered to a school's teaching staff, which is a workshop rather than therapy. Training and workshops has the argument.
424 Group programs, listed supports carries listed group programs, and the shipped rows include no route to it, so a listed social skills group resolves to the plan managed default beside individual therapy.

The one the corpus leaves open is a participant report the therapist writes as part of the therapy. All three canonical templates carry a confirm note on that row rather than an answer, so this page leaves it open too and the account follows the practice's own call.

Telepractice changes the room, not the account

Part of a speech caseload is delivered by video, to families a long way from the clinic and between school visits. The three conditions name the service, the practitioner and the treatment. None of them names the room, and the template holds no category for delivery mode, so a telepractice session resolves through the funder and the line type exactly as the same session in the clinic does.

The settlement side: bulk rails, and the invoice that is not one

Revenue accounts answer what was earned. The other half of the chart answers what has been paid but not yet banked, and the template opens one account per settlement rail: the NDIA, plan managers, private and self managed card or EFTPOS, and online payments. Each is a bank type account in Xero and each posts BAS excluded, because the earning already happened on the revenue leg.

A school contract needs none of that. A term invoice paid by an organisation's accounts payable run arrives as one credit against one invoice, with nothing to split, so it reconciles in the bank feed like any single payment. The bulk rails exist for deposits that pay many invoices at once. Plan managed NDIS money covers the wait on the busiest.

Setting it up in Xero

Create the revenue accounts first, with the tax rate set on each one, so a coded line cannot pick up the wrong rate later.
Decide the school and preschool question before the first term invoice, and write down which way it went and why.
Create the settlement accounts as bank type accounts, one per rail, with payments enabled on each.
Open the report and workshop accounts before anything is billed to them, because the first one is usually invoiced in a hurry.
Spend the two tracking category slots on practitioner and location, and leave funder and line type to the account codes, where the tax rate already lives.
Reconcile one real deposit end to end before turning anything on for the whole practice.

What Ledger Map does with it

Ledger Map holds one standing map for the practice, approved before anything syncs. A line resolves to its account and tax rate through that map on the funding source and the service category together, so a school block, a report and a therapy hour stop sharing a code because they share a therapist.

When a deposit lands, the batch is posted as one balanced document set against the rail's settlement account with the claim lines underneath it, and one exact match is left in the bank feed for the practice to accept. Where the map cannot resolve a line, it becomes a question with the options laid out rather than a silent posting. See how it works, or the learn hub.

Questions

Which income accounts does a speech pathology practice need in Xero?
Enough to keep each payer apart, and each taxable line type apart from the therapy beside it. The canonical NDIS provider template ships fifteen: a listed and a non listed account for each of the three NDIS management types, private clients, other third party payers, then reports, training, cancellations, travel and non face to face time, group programs and other income.
Is speech pathology GST free?
Speech pathology and speech therapy are both named in the ATO's list of health services, so the first of three conditions is settled. The other two still have to hold: the hour is performed by a recognised professional in that listed service, and the profession generally accepts it as necessary for the appropriate treatment of the recipient of the supply.
Is a school or preschool contract for speech pathology GST free?
It turns on who engaged the practice. Where a school engages the practice, the recipient of the supply is the school rather than the child, and the ATO says supplies of services to another business are not usually GST free. The four payers that keep a service GST free are an insurer, a statutory compensation scheme operator, a compulsory third party scheme operator and an Australian Government agency. Whether a particular school falls inside that last limb is a question for the practice's BAS agent, and this page does not settle it.
Where does a report written for a school post?
That depends on the funding source the invoice carries. Billed to a private family or on a plan managed NDIS invoice, the template sends a report to account 420 at GST on Income. Billed under the other third party funder, no category row exists, so it falls to that funder's default at account 407 and lands with the therapy instead. A practice with school work adds the row rather than leaving the default to answer.
Does telepractice change the account or the tax rate?
The three conditions name the service, the practitioner and the treatment, and none of them names the room. The template holds no category for delivery mode either, so a telepractice session resolves through the funder and the line type the same way an in room session does. Splitting video from in room revenue is a reporting question, and it belongs in item codes or a tracking category.

Sources

Open questions

Whether a state or territory school, a Catholic school or an independent preschool is an Australian Government agency for the third party rules. The ATO page names the limb and works one example, a state sports institute it calls an Australian Government agency; the corpus does not reach a school, and the answer decides the account.
Whether a participant report a speech pathologist writes as part of the therapy is plan funded documentation or third party work. All three canonical templates carry a confirm note on that row rather than an answer.
Whether a given therapy assistant arrangement meets every one of the ATO's assistant conditions, which include billing in the professional's name and direct supervision through the treatment. That is a per practice question.
Supervision hours sold to another practitioner. The corpus leaves the treatment open, so nothing here resolves it.
Whether a listed group program belongs on the template's group programs account or on the plan managed therapy default. The shipped rows resolve it to the default, because no row routes to the group account.
No SERP snapshot exists for this page's target query, so the current answer landscape was not captured and the FAQ was written from the material rather than from the questions Google is showing.
No speech pathologist's or practice manager's own account of setting this chart up was found. The quote on this page is a bookkeeper's.

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: recipient of the supply
Australian Taxation Office. Retrieved 3 Sep 2026. Source updated 12 Jun 2024.
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GST and health: supply of services through a third party
Australian Taxation Office. Retrieved 3 Sep 2026. Source updated 12 Jun 2024.
primary
GST and health: National Disability Insurance Scheme
Australian Taxation Office. Retrieved 3 Sep 2026. Source updated 13 Jun 2024.
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NDIS provider, plan managed, the canonical template
Ledger Map. Retrieved 3 Sep 2026.
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Bookkeeping for speech pathology and allied health practices
True Tally. Retrieved 3 Sep 2026. Source updated Jul 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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