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Service tax on doctors

Suraj (819 Points)

23 July 2012

Dear Sir / Madam,

There are many older posts on this topic on CA ClubIndia.

Now Service Tax laws and regulations have changed. But there are many clarifications are required as to taxability of services under service tax laws; though the Govt has issued a negative list.

I wish to know whether whether the doctor practising as physician cosultant is liable to service tax as of now?

Whether applicability of service tax changes with the nature of services offered by doctors? or his association with any hospital or other poly-clinic or practising independently? or based on his skill sets like normal physician or doctor performing cosmetic / plastic surgeries?

Friends, please throw some light on this.

Thanks.

Suraj

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5 Replies

Roshan Thomas (C.E.O ) (356 Points)
Replied 23 July 2012

Health care services by clinical establishment and medical practitioner are exempt from ST (notification 25/2012). So all types of service provided by medical practitioner is exempt. However it should be noted that health care does not include hair transplant, cosmetic or plastic surgery except to cure congenital defects, injury or trauma etc...

When he is associated to a hospital as an employee (i.e salaried) - service tax is not applicable.

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Suraj (819 Points)
Replied 24 July 2012

Thanks Roshan.

Accorging to this circular, it can be drawn that a doctor/physician running his own clinic should not have to pay service tax. But is this circular valid even though separate Negative list published by the Govt?

Roshan Thomas (C.E.O ) (356 Points)
Replied 27 July 2012

The exemption notification is intended to cover services which are not outside the scope of ST.

The notification is intended to exempt certain special categories of services within a broad head of service. Such broad head is taxable since not excluded by negative list.

Samir (ACA) (113 Points)
Replied 28 July 2012

In the Notification 25/2012, at Point No. 28(c), it is mentioned that: up to an amount of Rs. 5000/- per month per member. . . . .

What if the said amount exceeds Rs. 5,000/-

(1) Will whole of such sum will fall under the ambit of Service tax or only the amounts exceeding Rs. 5,000/-, like can this Notification be considered as deduction/ rebate?

(2) Will the Rs. 15 lacs be still applicable as basic exemption, to be out of the purview of Service Tax. For eg: if the amounts so mentioned exceed Rs. 5K per month, but the yearly collection is below Rs. 15 lacs?

CA Muthukumaran (Practicing Chartered Accountant) (23 Points)
Replied 30 June 2016

Hi friends

Have a doubt on service tax applicable on doctors.

One of our client is a doctor, who works in a government hospital and gets a salary from the hospital. Further, he works in a hosptial as a consultant and gets consultant fee based on no.of patient visits and TDS has been deducted u/s 194 J by the hospital.

A doctor works in a hospital is not liable to pay service tax on his salary income.

My doubt is, a doctor works in hospital as a consultant, whether he needs to pay service tax on consultant fee received?