Please note that the following document, although correct at the time of issue, may not represent the current position of the Canada Revenue Agency. / Veuillez prendre note que ce document, bien qu'exact au moment émis, peut ne pas représenter la position actuelle de l'Agence du revenu du Canada.
Excise and GST/HST Rulings Directorate
Place de Ville, Tower A, 11th floor
320 Queen Street
Ottawa ON K1A 0L5
[Addressee]
Case Number: 125721
Dear [Client]:
Subject: GST/HST RULING
Application of GST/HST to athletic therapy and manual osteopathic services
Thank you for your fax of June 16, 2010, concerning the application of the Goods and Services Tax (GST)/Harmonized Sales Tax (HST) to a supply of manual osteopathic services. We apologize for the delay in our response.
The HST applies in the participating provinces at the following rates: 13% in Ontario; and 15% in New Brunswick, Newfoundland and Labrador, Nova Scotia and Prince Edward Island. The GST applies in the rest of Canada at the rate of 5%.
All legislative references are to the Excise Tax Act (ETA) unless otherwise specified.
STATEMENT OF FACTS
We understand that:
1. You are a certified Athletic Therapist and a Osteopathic Manual Practitioner who provides athletic therapy and manual osteopathic services.
2. […][information on client activities].
3. […][information on client activities]
4. […].
5. You hold a Diploma in Osteopathy Manual Practice, which you obtained through the Canadian College of Osteopathy. You are a member of the Ontario Association of Osteopathic Manual Practitioner […].
6. […].
Please note that, for purposes of this ruling, the terms “manual osteopathic services”, “osteopathic manual practitioner” and “manual osteopathy” do not refer to the profession of osteopathy that is regulated in conjunction with the practice of medicine (i.e., that which is governed by a provincial College of Physicians and Surgeons).
RULING REQUESTED
You would like to know whether your supplies of services as a certified Athletic Therapist and as an Osteopathic Manual Practitioner are taxable for GST/HST purposes.
RULING GIVEN
Based on the facts set out above, we rule that your supplies of athletic therapy services as a certified Athletic Therapist and your supplies of manual osteopathic services are taxable at a rate of 5%, 13% or 15%, depending on the place of supply, as they are not exempt under section 7 of Part II of Schedule V.
EXPLANATION
Generally, most supplies of property and services made in Canada are subject to GST/HST, unless they are specifically exempt under Schedule V or zero-rated (taxed at 0%) under Schedule VI. Part II of Schedule V sets out the health care services that are exempt from GST/HST. A supply of a health care service rendered by a health care professional that is not included in Part II is generally subject to GST/HST.
Currently, there is no provision in the ETA that specifically exempts supplies of athletic therapy services rendered by a Certified Athletic Therapist or supplies of manual osteopathic services from the GST/HST.
Section 7 of Part II of Schedule V
Section 7 of Part II of Schedule V provides exemptions from the GST/HST to the supply of an optometric, chiropractic, physiotherapy, chiropodic, podiatric, osteopathic, audiological, speech-language pathology, occupational therapy, psychological, midwifery, dietetic, acupuncture and naturopathic services rendered to an individual when a practitioner provides the service. Therefore, in order for a supply to be exempt pursuant to section 7, the supply must be a supply of a service listed in section 7 and the supply must also be rendered to an individual by a practitioner of that service.
Section 1 of Part II of Schedule V defines
“practitioner to mean a person who:
(a) practises the profession of optometry, chiropractic, physiotherapy, chiropody, podiatry, osteopathy, audiology, speech-language pathology, occupational therapy, psychology, midwifery, dietetics, acupuncture or naturopathy as a naturopathic doctor, as the case may be,
(b) where the person is required to be licensed or otherwise certified to practise the profession in the province in which the service is supplied, is so licensed or certified, and
(c) where the person is not required to be licensed or otherwise certified to practise the profession in that province, has the qualifications equivalent to those necessary to be so licensed or otherwise certified in another province.”
Athletic therapy services rendered by a Certified Athletic Therapist are not included in the services contained in section 7 of Part II of Schedule V and are therefore not otherwise exempt. Additionally, a Certified Athletic Therapist cannot be a “practitioner” as defined in section 1 of Part II of Schedule V as athletic therapy is not included in the professions listed in paragraph (a) of the definition.
For purposes of section 7, to be a practitioner in respect of osteopathic services, a person must be licensed or otherwise certified to practise the profession of osteopathy in the province in which the service is supplied (paragraph (b) of the definition of practitioner), or, 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 (paragraph (c) of that definition).
In order to be licensed or otherwise certified to practise a particular health profession in a province, a person must be a member of a provincial regulatory body responsible for the regulation of the health profession in that province. The role of these provincial regulatory bodies and the authority to monitor and regulate their respective health professions is set out in provincial legislation.
In Ontario, the practice of osteopathy is regulated in conjunction with the practice of medicine under the Medicine Act, 1991 and falls under the jurisdiction of the College of Physicians and Surgeons of Ontario (College). Subsection 9(1) of the Medicine Act, 1991 provides, in part, that no person other than a member of the College shall use the title “osteopath” or any variation or equivalent. Further, pursuant to subsection 9(3) of the Medicine Act, 1991, no person other than a member of the College shall hold himself or herself out as a person who is qualified to practise as an osteopath in Ontario.
Therefore, with respect to supplies of services made in Ontario, an osteopathic manual practitioner, such as a person who possesses a Diploma in Osteopathy Manual Practice, is not a practitioner for purposes of section 1 of Part II of Schedule V and, consequently, a supply of manual osteopathic services rendered by such an osteopathic manual practitioner is not exempt under section 7 of Part II of Schedule V.
With respect to supplies of manual osteopathic services made in provinces other than Ontario, the relevant provincial legislation for each province or territory was reviewed in order to identify any provincial licensing or certification requirements. Based on this review, it is our understanding that there are no provincial licensing or certification requirements in any province or territory in Canada for the profession of manual osteopathy and, accordingly, there are no provincial regulatory bodies responsible for the regulation of the profession of manual osteopathy. Therefore, a manual osteopathic practitioner is not a “practitioner”, as defined in section 1 of Part II of Schedule V, and supplies made by a manual osteopathic practitioner are not exempt under section 7.
Section 9 of Part II of Schedule V
Section 9 of Part II of Schedule V exempts a supply (other than a zero-rated supply) of any property or service but only if, and to the extent that, the consideration for the supply is payable or reimbursed by the government of a province under a plan established under an Act of the legislature of the province to provide for health care services for all insured persons of the province. An "insured person" is defined in section 1 of Part II of Schedule V to have the same meaning as in the Canada Health Act. An example of a provincial health insurance plan described in section 9 is the Ontario Health Insurance Plan (OHIP).
It is a question of fact as to whether the consideration (or a portion of the consideration) for the supply of athletic therapy rendered by a certified Athletic Therapist or a supply of manual osteopathic services is paid or reimbursed by the government of a province under a plan described in section 9 of Part II of Schedule V to the ETA. To the extent that a government of a province directly pays or reimburses a person for athletic therapy or manual osteopathic services in circumstances where the requirements of section 9 of Part II of Schedule V are met, the supply of the service would be exempt.
In accordance with the qualifications and guidelines set out in GST/HST Memorandum 1.4, Excise and GST/HST Rulings and Interpretations Service, the Canada Revenue Agency (CRA) is bound by the ruling(s) given in this letter provided that: none of the issues discussed in the ruling(s) are currently under audit, objection, or appeal; no future changes to the ETA, regulations or the CRA’s interpretative policy affect its validity; and all relevant facts and transactions have been fully and accurately disclosed.
If you require clarification with respect to any of the issues discussed in this letter, please call me directly at 613-670-7932. 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,
Art Blommesteijn
Health Care Sectors Unit
Public Service Bodies and Governments Division
Excise and GST/HST Rulings Directorate
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