BUSY is a simple, yet powerful GST / VAT compliant Business Accounting Software that has everything you need to grow your business.
Healthcare is a fundamental need, and the government has ensured that essential medical services remain affordable. But what about GST? Is it charged on hospital bills or doctors’ fees? Let’s break down the gst on healthcare services and understand which services are exempt and which are taxable under GST.
Yes. Under the GST law, most healthcare services are exempt, particularly those related to diagnosis, treatment, or care provided by:
This ensures that essential medical services do not carry an added tax burden for patients.
gst on hospitals providing clinical healthcare services is 0% (exempt). This includes:
However, certain non-healthcare services offered by hospitals are taxable.
gst for doctors providing independent healthcare services is also exempt. This applies to:
GST applies only if a doctor:
Otherwise, regular doctor consultations and procedures are GST-free.
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| Service Type | GST Rate | Remarks |
|---|---|---|
| Pathology and diagnostic tests | Exempt | If part of healthcare service |
| Ambulance services | Exempt | Emergency transportation |
| Pharmacy inside hospital | Exempt | If medicines are part of treatment |
| Independent pharmacy (retail store) | 5% or 12% | GST applicable |
| Yoga, wellness centres | 18% | If not certified medical service |
Healthcare providers cannot claim ITC on inputs used in providing exempt services.
| Input/Expense | ITC Allowed? |
|---|---|
| Hospital furniture | ❌ No |
| Medicines used for treatment | ❌ No |
| Equipment (scanners, beds) | ❌ No |
| IT systems, admin software | ❌ No |
However, if a healthcare business provides both exempt and taxable services, it must separately track ITC eligibility and apportion ITC correctly.
Understanding the gst on healthcare services helps both providers and patients avoid billing mistakes and stay compliant. In short, most medical services remain tax-free, with GST applicable only to select add-on or premium offerings.
BUSY is a simple, yet powerful GST / VAT compliant Business Accounting Software that has everything you need to grow your business.