No, not for treating clients. Occupational therapy delivered to a person for their health is HST-exempt in Canada, so a registered OT does not add tax to client care. The taxable side is the work done for someone other than the client: insurer assessments, file reviews, medico-legal reports, and similar third-party jobs all carry HST. If that side of the practice grows past $30,000 a year, you have to register and charge tax on it while your treatment work stays exempt.
Occupational therapists sit in an odd spot. The clinical work is clearly exempt health care, but a big share of OT income in private practice comes from insurers, lawyers, and employers rather than from the client on the treatment table. That mix is exactly where HST mistakes happen, so it is worth knowing where the line actually sits.
Treating a client is exempt
Occupational therapy is on Canada’s list of exempt health professions. When you assess a client, build a treatment plan, and work with them on recovery or daily function, that service carries no HST. It does not matter whether the client pays you directly, a parent pays, or an insurer reimburses them. What matters is that a licensed occupational therapist is providing care to an individual for their health.
The exemption comes with the usual condition: you need to be registered with your provincial college. It also comes with the usual trade-off. Because your treatment income is exempt, you cannot claim back the HST you pay on the costs of providing it. The tax on your assessment tools, software, and clinic space stays with you as a cost of doing business.
The purpose test: who is the work really for?
Since 2013, the exemption only covers services with a health care purpose, meaning care aimed at maintaining health, treating an injury or illness, or helping a person cope with one. Work whose real purpose is something else is taxable, even though it uses the same professional skills.
In an OT practice, that captures a lot of common contracts. An insurer examination to decide whether benefits should be paid is taxable. So is a paper file review giving an opinion on whether someone else’s treatment plan is reasonable. So are cost-of-future-care reports for a lawsuit, catastrophic impairment assessments for the insurer’s file, and expert testimony. The client may be in the room, but the service is being delivered to the insurer or the lawyer, and the tax rules treat it that way. Psychologists live with the same split, and OTs doing auto insurance work usually have more of it.
Client care
Assessments and treatment provided to your client for their recovery, function, or daily living. No HST, regardless of who reimburses it.
Third-party work
Insurer examinations, file reviews, medico-legal reports, and expert testimony. HST applies once you are registered.
Watch the assistant question
The exemption is written for care rendered by the practitioner. When a clinic uses occupational therapy assistants to deliver parts of a program, services rendered by the assistant rather than the therapist can fall outside the exemption. Whether a particular arrangement stays exempt depends on how the supervision and billing are structured, so if assistants are part of your model, that setup deserves a proper review rather than an assumption.
When you have to register
The $30,000 small-supplier threshold counts taxable sales only, measured over four rolling calendar quarters. Exempt treatment income never counts toward it. An OT doing purely clinical work can bill well past that figure and have no HST obligations at all.
Assessment and report income counts in full. A practice doing steady insurer work can cross $30,000 quickly, and once it does, you are expected to register, charge HST on the third-party work, and file returns, while your treatment services stay exempt. Registration also lets you recover the HST on costs tied to the taxable side. Running both streams through one set of books without separating them is the most common mess we untangle for mixed clinics, and it cuts both ways: miss the registration and you owe tax you never collected, lump everything together and you can remit tax that was never due.
Common questions
I am employed by a hospital or clinic. Does any of this apply to me?
No. Employment income is not a sale, so HST never enters the picture. These rules start to matter once you invoice clients, clinics, or insurers as your own practice.
I do ergonomic assessments and return-to-work services for employers. Taxable?
It depends on the purpose. Work aimed at treating a specific worker’s injury or helping them cope with it can still qualify as exempt health care. General workplace consulting sold to a company is a taxable service. Contracts in this area are worth reviewing one by one, because the wording of the engagement often decides the answer.
I sell adaptive equipment to clients. Is that exempt too?
Usually not. Product sales are separate from your exempt service, and most are taxable, though certain medical devices have their own special rules. If a retail side is becoming part of your practice, get the categories right before the volume grows.
Doing a mix of treatment and assessment work and not sure what should carry HST? Send us a note about your practice and we will map the line for you.