GST answers
Do psychologists charge GST?
Usually not on the session itself. Psychology is one of the health services the GST Act lists, so a session is GST free where a recognised psychologist delivers it as appropriate treatment for the person who engaged them. Reports, supervision, training, workbooks and employer funded sessions are separate supplies, and the canonical psychology template posts each of them at the taxable rate.
Key facts
- Where psychology sits
- Psychology is one of the health services the GST Act lists, so a session can reach GST free treatment without a Medicare benefit being payable for it1
- The two conditions after the list
- The service has to be performed by a recognised health professional in that listed service, and it has to be generally accepted in that profession as necessary for the appropriate treatment of the recipient of the supply1
- What appropriate treatment means
- Assessing the person's health, working out a course of action to preserve, restore or improve their wellbeing as far as the practitioner's training allows, and supplying a treatment the profession accepts as appropriate, including preventative care2
- Who the recipient is
- Whoever engages the practitioner to provide the service, which is often the client and is sometimes a business, and a supply to another business is not usually GST free3
- Where the session lands
- The canonical psychology template posts a private session to account 400, clinical services for private patients, at the Xero rate labelled GST Free Income6
- The lines that carry GST on Income
- The canonical psychology template posts reports and court attendance on 420, supervision and training on 421, workbooks and resources on 424, and an employer funded EAP session on 4076
- What an accountants' booklet for psychologists adds
- Registration with the Psychology Board of Australia is how a psychologist meets the recognised professional condition, and travel is treated as following the health service it relates to7
Being on the list settles one condition of three
Psychology is named in the GST Act's list of health services, which is why the short answer to the query is no for a session. It is also why the short answer is unhelpful the moment a practice looks at its own invoices. The listing is one condition. Two more sit behind it, and both are answered per session rather than per practice.
The ATO sets the three out together. The service is a listed health service. It is performed by a recognised health professional in that listed service, or under set conditions by their assistant. And it is generally accepted in that profession as necessary for the appropriate treatment of the recipient of the supply. A psychology practice clears the first without thinking, then spends the year on the other two.
The recipient of the supply by the health professional will not always be the patient. In some cases, it may be another business.1
The two conditions that decide an individual hour
A recognised health professional is a person registered, permitted or approved under a state or territory law to provide the listed service. Psychology is regulated, so the path runs through registration rather than through association membership, and an accountants' booklet written for psychologists puts it the same way: registration with the Psychology Board of Australia is how the condition is met. That is settled once per practitioner and stays settled.
The third condition is the one that moves. Appropriate treatment means using professional skills to assess the person's health, work out a course of action to preserve, restore or improve their physical or psychological wellbeing as far as training allows, and supply a treatment the profession accepts as appropriate for that person. Preventative work and routine review sit inside it. An hour that treats nobody sits outside it.
- A session with a client, delivered by the registered psychologist, meets all three conditions and is GST free.
- An hour spent supervising another practitioner treats no client of the practice, which is the reading behind the taxable default and the one a BAS agent is asked to confirm.
- A workshop delivered to an audience is not treatment of a person who engaged the practitioner for treatment.
- A report written for a court, an insurer or an employer is a supply to whoever asked for it, which the ATO answers under the recipient rule rather than under the list.
The whole revenue list, as the psychology template posts it
Search results answer for the session and stop. A practice bills more than sessions, and the next question is which account and which Xero rate each line takes. Every account code, account name and rate in the table below is resolved from the canonical psychology template through the product's own revenue cascade.
| What is billed | Account in the psychology template | Xero tax rate |
|---|---|---|
| Private session | 400 Clinical services, private patients | GST Free Income |
| Session claimed through Medicare | 401 Clinical services, Medicare | GST Free Income |
| Session for a plan managed NDIS participant | 403 Clinical services, NDIS plan-managed | GST Free Income |
| Session funded by WorkCover | 405 Clinical services, WorkCover and workers compensation | GST Free Income |
| Session bought by an employer under an EAP contract | 407 Employee assistance program contracts | GST on Income |
| Report, assessment or court attendance | 420 Reports, assessments and medico-legal | GST on Income |
| Supervision of another practitioner | 421 Supervision, training and workshops | GST on Income |
| Training, workshop or speaking fee | 421 Supervision, training and workshops | GST on Income |
| Workbook or resource sold to a client | 424 Products | GST on Income |
Two things show up once the lines sit together. The account moves with the funder while the rate holds across the first four rows, so a practice can read clinical income by funder on one tax rate. The fifth funder row is where that stops: an employer funded session takes the taxable rate, and so do the four lines at the foot under the private funding source, which is where a practice's own invoices leave the answer the search results stop at.
Where a private session posts
The session itself is the row every other line is measured against. All three canonical templates hold their own private patient row, so nothing here is reached by a fallback, and all three send it to the same account at the same rate.
The card's footer is the part worth reading twice. Under the same private funding source, each template names the categories it gives a row of their own, and those categories are the exceptions a practice actually bills. Is allied health GST free works the same row across the professions.
The four categories that leave the default
Reports, supervision, training and products each get a row of their own in the psychology template, and each carries the GST on Income rate. The reasons differ, so a practice cannot treat them as one category with one story.
- The ATO sets the report test out for medical reports: one is GST free only where a Medicare benefit is payable for it or it is an ordinary and natural part of the GST free service. The psychology template posts a court report or an insurer's assessment taxable on the same reasoning. GST on medical reports takes that line on its own.
- The template's reason for supervision is that it is a service to the practitioner being supervised, so it posts taxable and carries a note asking the practice's BAS agent to confirm the fact pattern. GST on supervision sets out both readings.
- A workshop, seminar or speaking fee is not treatment of a person who engaged the practitioner, and short courses and seminars fall outside the education provisions. GST on training and workshops covers it.
- Workbooks, resources and assessment materials sold to a client are goods rather than a necessary part of the treatment supplied at the same time and place. GST on products sold to patients covers the goods test.
Who engaged the psychologist
The clearest taxable session in a psychology practice is a session that looks identical to a GST free one. An employer buys sessions for its staff under an employee assistance program. The hour is the same hour, delivered by the same registered psychologist, and the practice's template posts it at the taxable rate because the employer engaged the practitioner and the employer is not the patient.
There is one extension, and it is a closed list. Where the same service supplied to the person would be GST free, it stays GST free when the practice contracts with an insurer, an operator of a statutory compensation scheme, a compulsory third party scheme operator, or an Australian Government agency. The parties can also agree not to treat those supplies as GST free. Any other third party sits outside the extension, which is why an employer contract lands where it does. Is EAP counselling GST free runs the contract case out.
The same rule decides the contractor question. Where a practice contracts a psychologist to see the practice's clients, the psychologist's supply is to the practice and the practice's supply to the client is judged on its own terms. Turn the contract around and the psychologist supplies the client while the practice supplies rooms. Only the contract settles which way round it is, and GST on contractor practitioner invoices works through both.
Cancellations and group sessions, where the template stays quiet
Two lines a psychology practice bills every week are missing from the table above. The psychology template's chart carries an account for cancellation and no-show fees and another for group sessions, and no funding source row sends a private cancellation or a private group session to either of them. Both take the private session row instead, at the GST free rate, until a practice adds a row of its own.
That default matches the principle a cancellation fee follows, which is that the fee takes the treatment of the session it replaces. It also means a cancelled supervision hour or a cancelled EAP session needs its own answer rather than the default, and the EAP rows in the template already carry one. GST on cancellation fees and GST on group therapy sessions each take one of these.
A mostly GST free practice still lodges
GST free is a treatment of a supply. Registration turns on turnover, so a practice whose session income is entirely GST free can still be registered, still lodge, and still claim credits on its own costs. The taxable lines are what put an amount at 1A rather than only at G1 total sales.
The two errors run in opposite directions and neither announces itself. A whole practice set to the GST free rate leaves the report, supervision, training and product lines short, and the correction reaches back across every invoice posted the same way. A whole practice set to the taxable rate gives up one eleventh of session income that did not have to go. Both produce an invoice that syncs and a deposit that reconciles. One invoice, GST free and taxable lines shows a mixed week on a single document.
What Ledger Map does with a psychology practice's lines
Ledger Map holds one standing map for the practice, approved before anything syncs. A session, a report and a supervision hour resolve through that map to an account and a tax rate, so the table above is decided once rather than invoice by invoice, and the template's own reason travels next to each row.
The product does not choose the treatment. It shows what the canonical template the practice started from posts, and a line the map cannot resolve becomes a question with the options laid out rather than a quiet posting.
On the bank side, each deposit is posted as one balanced document set, which leaves one exact match in the bank feed for a person to accept. The clearing leg of that set posts BAS excluded in every canonical template, because it settles income the practice has already earned and posted. The tax rate question belongs to the revenue lines underneath it. How it works shows the map and the approval step.
Questions
Do psychologists charge GST in NSW?
The rules are federal, so the answer does not change between New South Wales and any other state. A session delivered by a registered psychologist as appropriate treatment is GST free wherever it happens. What can differ between practices in the same street is the mix of work: one that writes court reports, supervises provisional psychologists and runs workshops has taxable lines that a purely clinical practice does not.
Do doctors need to charge GST?
Medical services reach GST free treatment by a different route. A medical service is either a service for which a Medicare benefit is payable, or another service supplied by or on behalf of a medical practitioner that is generally accepted in the medical profession as necessary for appropriate treatment. Where the recipient is a business rather than the patient, that supply is not GST free as a medical service unless a Medicare benefit is payable.
Do psychologists need to register for GST if everything they bill is GST free?
Registration and treatment are separate questions. Registration turns on turnover rather than on how each line is taxed, and a registered practice with GST free session income still lodges and can still claim credits on rent, software and clinical resources. The threshold, and how GST free income is counted towards it, are not printed here: no ATO registration page was read for this page, so both sit with the practice and its BAS agent.
Is GST charged on health services?
Some are GST free and some are taxable, and the Act settles it service by service rather than profession by profession. A health service that is not a medical service is GST free only where it is one of the listed services, is performed by a recognised professional in that listed service, and is accepted in that profession as necessary for appropriate treatment of whoever engaged the practitioner. Psychology is on that list. Coaching, art therapy and personal training are not.
Why do some psychology practices charge GST on supervision and psychometric testing?
Supervision is the more common of the two and the less settled. The canonical psychology template posts it taxable, on the reading that supervising another practitioner is a service to that practitioner rather than treatment of a client, and it carries a note that an ATO interpretative decision points the other way for supervision of provisionally registered psychologists in a particular fact pattern. The template states the default and leaves the question with the practice and its BAS agent. Testing delivered as part of assessing and treating a client is part of the session.
Read next
Sources
Open questions
- Supervision is the profession's most cited grey area. The canonical psychology template posts it taxable and carries a BAS agent note saying one bookkeeping source treats it that way while an ATO interpretative decision points the other way for supervision of provisionally registered psychologists in a specific fact pattern. This page states the default and leaves the question open.
- Psychometric testing sold on its own, rather than as part of assessing and treating a client, is not named on any ATO page read for this page, and the practice fee pages in the search results split on it.
- An ATO legal database view on whether psychotherapy and psychoanalysis are GST free appeared in the search results as a snippet only. ato.gov.au refuses automated fetches and that page was not read in full, so no position is taken on those two services here.
- The GST registration turnover threshold is not printed here, and neither is the way GST free income counts towards it. No ATO registration page was read on 3 Sep 2026, so the page states that registration turns on turnover without naming a figure or a test.
- Whether a specific NDIS report or a non face to face support is a funded therapy support or third party work is an item level question. The canonical templates flag it for the practice and its BAS agent rather than settling it.
- The five ATO pages cited refuse automated fetches and were read through a signed-in browser on 3 Sep 2026. Each carries the last updated date it prints, and a reader checking the wording will need to open them 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: appropriate treatment
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.
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- GST and health: medical services
Australian Taxation Office. Retrieved 3 Sep 2026. Source updated 12 Jun 2024.
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- Psychology practice with booking deposits, the canonical template
Ledger Map. Retrieved 3 Sep 2026.
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- Goods and Services Tax for Self Employed Psychologists
Sheridans Accountants and Financial Planners. Retrieved 3 Sep 2026. Source updated Jul 2022.
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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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