Please note that the following document, although correct at the time of issue, may not represent the current position of the Agency. / Veuillez prendre note que ce document, bien qu'exact au moment émis, peut ne pas représenter la position actuelle de l'Agence.
XXXXX
XXXXX
XXXXX
Excise and GST/HST Rulings Directorate
Place de Ville, Tower A, 15th floor
320 Queen Street
Ottawa ON K1A 0L5
Case Number: 114093r
Attention: XXXXX XXXXX
August 9, 2010
Dear XXXXX:
Subject:
GST/HST INTERPRETATION
Tax Status of Supplies of Nursing Services
This is in reply to your letter of XXXXX, XXXXX concerning the application of the Goods and Services Tax (GST)/Harmonized Sales Tax (HST) to supplies of nursing services.
HST applies at the rate of 15% in Nova Scotia, 13% in New Brunswick, Newfoundland and Labrador, and Ontario, and 12% in British Columbia. GST applies at the rate of 5% in the remaining provinces and territories.
All legislative references are to the Excise Tax Act (ETA) unless otherwise specified.
Interpretation Requested
XXXXX. In your recent letter you provided additional information regarding the activities of registered nurses for consideration by the CRA in its interpretation of nursing services. In particular, you cited four activities undertaken by registered nurses involving foot care, psychotherapy, transportation of ill or injured individuals, and coordinating and supervising the care of clients of home care agencies for which you would like clarification as to whether these activities would fall within the CRA's definition of nursing services. You advised that registered nurses are practicing nursing when they are engaged in these activities. Therefore, these activities should be considered as involving the supply of exempt nursing services for purposes of the ETA.
Interpretation Given
Generally, most supplies of property and services made in Canada are taxable for GST/HST purposes, unless they are exempt supplies. Exempt supplies are listed in Schedule V. Part II of Schedule V provides that certain health care services are exempt from GST/HST. In order for a supply of property or a service to be exempt from GST/HST under Part II of Schedule V, a specific exempting provision included in Part II must apply to that particular supply.
In addition, it should be noted that the GST/HST is a transactional tax and as such, the exempting provisions in Part II of Schedule V apply on a supply-by-supply basis. These provisions set out specific criteria that must be met in order for a particular supply of a service to fall within those provisions. For every supply or transaction, the supplier must determine whether these criteria are met or whether the tax is applicable. Because of these criteria it is possible for a supplier to make a mix of taxable and exempt supplies and for the tax status of a supply to differ depending on the supplier. Thus, regardless of the manner in which nursing services may be defined, the tax status of a particular supply of nursing services is also conditional on whether the supply meets all of the criteria set out in the exempting provision, as explained below.
Section 6 of Part II of Schedule V
Section 6 of Part II of Schedule V exempts a supply made after February 26, 2008 iFootnote 1, of a nursing service rendered to an individual by a registered nurse, a registered nursing assistant, a licensed or registered practical nurse or a registered psychiatric nurse, if the service is rendered within a nurse-patient relationship. Given the preceding, there are three criteria that the supply must meet to be exempt; i.e., it must be a service that:
• is rendered by a registered or licensed nurse;
• falls within the scope of nursing services; and
• is rendered to an individual within a nurse-patient relationship.
Under a transactional tax system such as the GST/HST, exempt status applies to the supply and not to the supplier. Each supply (as provided for under each contract) is evaluated to determine if it is a nursing service rendered by a registered or licensed nurse to an individual within a nurse-patient relationship. This evaluation would include an analysis of the terms and conditions of the relevant contract or agreement for the supply to determine whether the supply satisfies the criteria of section 6 of Part II of Schedule V. Accordingly, regardless of whether an activity may be characterized as a nursing service, the supply of that service must meet all the criteria of section 6 of Part II of Schedule V to be exempt. There criteria are discussed below.
Rendered by a registered or licensed nurse
In your recent letter you advised that the Regulated Health Professions Act, S.O. 1991, c. 18, and the Nursing Act, S.O. 1991, c. 32, contain definitions for nursing services. You expressed the view that the CRA should consider this provincial legislation.
Because of the reference to the specific titles in the exempting provision; i.e., only the services rendered by licensed or registered nurses are exempt, we do consider the provincial legislation of the nursing profession for purposes of administering the ETA. As such, we consider a registered or licensed nurse to be an individual who meets certain standards of education, clinical competence and registration or other licensing requirements as set out by provincial legislation governing the nursing profession.
Since the services in question are supplied in XXXXX, we consider the manner in which the nursing profession is regulated by the laws of that province. As you noted, nurses in XXXXX are regulated under the XXXXX Act and the XXXXX Act. Regulations under the XXXXX Act establish the requirements that must be met for registration as an RN or RPN and titles used by nurses are protected under this Act. These provincial Acts provide the legal framework for nursing as a self-regulating profession. In addition, the XXXXX (the College) has been delegated the authority under these provincial Acts for the regulation and registration of individuals who are qualified to practice the nursing profession in XXXXX.
XXXXX.
Scope of nursing services
Because the ETA does not regulate or define nursing services, the CRA has developed an administrative position for purposes of the GST/HST, XXXXX. You expressed concern regarding our approach to the meaning of nursing services and suggested that the CRA consider a legislated definition, such as those found in the XXXXX Act and the XXXXX Act.
As noted above, we do consider the manner in which the nursing profession is regulated by provincial laws. Based on a review of the XXXXX Act and the XXXXX Act as well as the College's standards and guidelines, we understand that the scope of practice for nursing in XXXXX is the promotion of health and the assessment of, the provision of care for, and the treatment of, health conditions by supportive, preventative, therapeutic, palliative and rehabilitative means in order for a patient to attain or maintain optimal function. Nurses are authorized to perform various controlled acts when rendering nursing care to their patients. Core nursing services generally focus on the diagnosis and treatment of health problems of a patient, administration of medications and other interventions.
Various XXXXX produced by the College set out guidelines for registered nurses to determine whether they are practicing nursing. XXXXX.
According to the XXXXX entitled XXXXX, nursing roles may include clinical, practitioner, administrator, teacher, and researcher. They work in many different settings, including hospitals, long-term care facilities, clients' homes, clinics, industries, and classrooms.
The XXXXX entitled XXXXX contains a checklist that registered nurses may use to determine if a particular activity they are engaged in falls with the practice of nursing. These questions include whether the activity involves the nurse applying nursing knowledge, skill and judgment and whether the nurse has a direct or indirect effect on the recipient of a health care service in XXXXX. As well, there is a list of activities registered nurses would check involving assessment, planning, intervening, evaluating, and other activities, and a list of various settings in which registered nurses undertake these activities, such as in an acute care hospital, a long-term care facility, independent practice, educational institution, and a government agency.
Based on a review of this information and our research, we understand that registered nurses may work in a wide variety of practice settings, be engaged in a variety of activities for which his or her particular knowledge and qualifications may be relevant to the recipient of his or her supplies, and that nursing roles and responsibilities are continually evolving and changing. For instance, registered nurses may perform supervisory, administrative, consultant, teaching and researching activities.
However, it is important to note that even where an activity may be characterized as a nursing service, as noted above and further explained below, that activity will not be an exempt supply for purposes of section 6 of Part II of Schedule V where it does not constitute a nursing service rendered to an individual within a nurse-patient relationship.
Some of these activities that would not involve such services are communicating with communities or populations, managing nursing resources such as staff, facilities and equipment, developing learning resources for nurses or other health care providers, and providing or developing health education for organizations.
Rendered to an individual within a nurse-patient relationship
The reference to "patient" can denote an individual who is experiencing an illness that requires acute or chronic care. A registered or licensed nurse establishes and maintains a nurse-patient relationship by using nursing knowledge and skills to render patient care services involving supportive, therapeutic, palliative and rehabilitative services to assist the patient in attaining or maintaining optimal function, such as treating the health problems of a patient, administering medications and performing other interventions. Thus we interpret this criterion in section 6 of Part II of Schedule V as meaning nursing services that involve personal interaction between a nurse and an individual who is a patient where there is an established or ongoing relationship between the nurse and the patient and the nurse is a direct care provider of the patient.
Accordingly, when a registered nurse, a registered nursing assistant, a licensed or registered practical nurse or a registered psychiatric nurse, renders nursing services to an individual in the capacity of a care provider, i.e., in a professional nurse-patient therapeutic relationship, these nursing services will be exempt.
If the service does not involve a relationship between the registered nurse and the individual and the nurse is not a care provider of the individual, this would indicate that there is no nurse-patient relationship. Accordingly a service provided by a registered nurse will not be exempt for GST/HST purposes even if the service is provided within the scope of a nursing practice if that service does not involve the provision by the registered nurse of direct care to an individual within a nurse-patient relationship.
XXXXX.
Regardless of the how broad the scope of a nursing practice may be, it is important to clarify that only those clients who are individuals receiving patient care services would fall within section 6 of Part II of Schedule V. In contrast, services rendered by a registered nurse to communities in a public health setting, students in an educational setting, staff in an administrative setting, and study participants in a research setting would not fall within this particular exempting provision.
Particular Activities
To summarize, registered nurses may work in a wide variety of practice settings, be engaged in a variety of activities for which his or her particular knowledge and qualifications may be relevant, and nursing roles and responsibilities are continually evolving and changing. You advised that registered nurses may now assume roles and responsibilities for particular services that were traditionally provided by other persons and you provided four examples to illustrate how nursing roles and responsibilities are evolving. We appreciate being informed of these changes so that we can appropriately address the issue of nursing services for purposes of the ETA.
Foot care
We had indicated in XXXXX, that we would not consider chiropodic or podiatric services as exempt nursing services. To clarify, please note that section 7 of Part II of Schedule V contains exemptions for chiropodic and podiatric services, but only when these services are rendered by a person who practises the profession of chiropody or podiatry and is licensed or otherwise certified to practise that profession in the province in which the service is supplied. Where the person is not required to be licensed or otherwise certified to practise the profession in that province, the person must have the qualifications equivalent to those necessary to be so licensed or otherwise certified in another province.
You advised that although foot care is traditionally provided by chiropodists or podiatrists in XXXXX, preventative or restorative quality foot care nursing services use nursing knowledge, skills and judgement to assess the patient as a whole. In addition, foot care performed by registered nurses involves the performance on a patient of a controlled act listed in the XXXXX Act and the XXXXX Act. Foot care services provided by registered nurses are supportive, preventative, therapeutic and rehabilitative in nature.
We have reviewed the issue of foot care provided by registered nurses. Our research indicates that foot care is a service that is recognized by various nursing associations as a specialty of nursing practice and that there are foot care nursing programs offered by various educational institutions. In some provinces registered nurses may have special recognition as a certified foot care nurse by a nursing association. Accordingly, we accept that there are situations where foot care may be a nursing service rendered to an individual within a nurse-patient relationship.
Psychotherapy
You advised that the XXXXX Legislature has passed an amendment, to be proclaimed, that adds the following authorized act to XXXXX of the XXXXX Act:
XXXXX.
You explained that nurses working in mental health and addiction treatment enter into therapeutic relationships with patients or groups of patients who face challenges with day-to-day mental functioning and who experience addictions to various substances including alcohol and tobacco. You also indicated that the promotion of mental health is a critical nursing function where nurses provide care for these patients in a variety of settings. As examples, you noted registered nurses working in an occupational health setting to provide supportive counselling to workers suffering from depression and nurses working in a school setting to lead smoking or alcohol cessation group sessions to assist in rehabilitating groups of youth. We understand that these psychotherapy services relate the above-noted amendment to the list of acts registered nurses are authorized to perform within the practice of nursing. We would therefore accept that there are situations where psychotherapy could be a nursing service rendered to an individual within a nurse-patient relationship.
Transportation of ill or injured individuals
You noted that many health care companies provide specialized medical evacuation and intra-facility transportation of ill and injured persons who may also require life-supporting equipment. These persons require the highly skilled and knowledgeable assessment and treatment provided by a registered nurse while in transit to a medical facility. Transport registered nurses have extensive knowledge and experience in aeromedicine, aviation safety, wilderness and water survival, critical care, trauma, paediatrics, orthopaedics, psychiatry, palliative care and oncology. We would accept that in these situations, the care provided by a registered nursing to an individual is a nursing service rendered to an individual within a nurse-patient relationship. However, with respect to the characterization of the supply made by a transportation company, the supply may be that of a transportation service where the care of the individual provided by a registered nurse is a component of, or an input to, that supply or a separate supply from the transportation service. Therefore, the exempting provision for nursing services may not apply to the supply provided by the transportation company.
Coordinating and supervising the care of clients of home care agencies
You cited the example of registered nurse supervisors and coordinators working for a home care agency, where the nurse assesses the needs of a client of the home care agency and recommends whether that client would require the services of a personal support worker or a registered nurse. While registered nurses are providing a service that is supervisory or administrative in nature, as it is directing others to provide the hands-on care, it is your view that because registered nurses are using their knowledge, skills and judgment to make decisions about the individual's care, they are practicing nursing.
We understand that one of the emerging roles of registered nurses is case management, which involves the activity of coordinating care of individuals who are clients of home care agencies and other service providers. Generally speaking, a case manager works in collaboration with service providers to link clients with appropriate providers and resources. Case management services are not limited to the nursing profession. These services could be an area of speciality practice within a given health care profession or they may be provided by unregulated providers. In any event, case managers must possess the appropriate education, skills, knowledge, and experience required to render appropriate services and adhere to ethical, legal, and regulatory standards or guidelines of their particular health care profession. Case managers have the ability to legally and independently practice without the supervision of another licensed professional.
Case management activities may include:
• assessment of the individual to identify the individual's needs in order to develop a comprehensive case management plan that will address those needs;
• determining and documenting the objectives, goals, and actions designed to meet the individual's needs as identified in the assessment process;
• implementing and documenting activities and interventions of the case management plan;
• coordinating, securing, modifying and documenting the resources relating to the case management plan;
• monitoring by gathering information from relevant sources, activities and services to determine the effectiveness of the case management plan; and
• measuring the interventions to determine the outcomes of the case management plan, such as the individual's quality of life and satisfaction.
Our research indicates that the regulatory bodies of the nursing profession have identified registered nurses as having a role as case managers because they have the skill, expertise and capacity to support and enhance the care of an individual. A nurse case manager is usually a registered nurse in a health practice setting who takes a leadership role in coordinating and facilitating the care of individuals. Nurse case managers provide physical assessment of the individual and they may also work collaboratively as a member of an interdisciplinary team and act as a clinical resource for the interdisciplinary team by providing information based on nursing theory and practice related to clients with complex health care needs.
Whether a particular supply of any supervisory, administrative or case management service rendered by a registered nurse constitutes a nursing service rendered to an individual within a nurse-patient relationship will have to be determined on a case-by-case basis. As discussed previously, if the service does not involve a relationship between the registered nurse and the individual and the nurse is not a care provider of the individual, this would indicate that there is no nurse-patient relationship. Accordingly a service provided by a registered nurse of supervising or directing others to provide care to an individual or of providing a case management service will not be exempt for GST/HST purposes even if the service is provided with the scope of a nursing practice, if that service does not involve the provision by the registered nurse of care to the individual within a nurse-patient relationship.
As indicated in XXXXX, the CRA will provide a ruling on whether a particular supply qualifies as an exempt supply of purposes of section 6 of Part II of Schedule V if the request includes supporting documentation explaining in detail the service provided. An evaluation of the supply would include an analysis of the terms and conditions of the contract or agreement for the supply to determine whether it satisfies the criteria of the exempting provision.
The CRA is responsible for administering the ETA and its regulations as passed by Parliament. The CRA cannot change the legislation that governs the application and collection of the GST/HST. The wording of the exempting provisions in Part II of Schedule V does not allow an interpretation that would include therein administrative, supervisory and other services performed by registered nurses where these services do not involve direct patient care rendered to an individual by a nurse within a nurse-patient relationship.
The foregoing comments represent our general views with respect to the subject matter of your request. These comments are not rulings and, in accordance with the guidelines set out in GST/HST Memorandum 1.4, Excise and GST/HST Rulings and Interpretations Service, do not bind the CRA with respect to a particular situation. Future changes to the ETA, regulations, or our interpretative policy could affect this interpretation.
If you require clarification with respect to any of the issues discussed in this letter, you can call Brian Olsen at 613-954-4289. Should you have additional questions on the interpretation and application of GST/HST, please contact a GST/HST Rulings officer at 1-800-959-8287.
Yours truly,
Chantal Desrosiers
Municipalities and Health Care Services Unit
Public Service Bodies and Governments Division
Excise and GST/HST Rulings Directorate
i 1. To be exempt under section of Part II of Schedule V, a supply made before February 27, 2008 has to be a supply of a nursing service rendered by a registered nurse, a registered nursing assistant, a licensed or registered practical nurse or a registered psychiatric nurse, where the service is rendered to an individual in a health care facility or in the individual's place of residence; the service is a private-duty nursing service; or the supply is made to a public sector body.
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