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Industry Guide:

Healthcare Services

 
Please click here to download complete guide.


FREQUENTLY ASKED QUESTIONS 


Registration

1. Are private healthcare facilities required to be registered under GST?

No, registered or licensed private healthcare facilities are not required to register under GST if they are supplying wholly exempt supplies even though their annual turnover exceeds RM500,000. 


Charges 

2. What is the GST treatment on registration fee charged to patient by the hospital?

Any registration fee charged by any hospital except government hospital is subject to GST.

3. Should GST be charged on medicine prescribed by a hospital doctor where the supplies are from a pharmacy other than hospital’s pharmacy?

The GST is charged at standard rate on the supply of medicine other than the medicines listed in the NEML prescribed by a hospital doctor where the supplies are from a pharmacy other than the hospital’s pharmacy.

4. Pharmacy in a private hospital/ clinic sells medicine to its own patient/ employee over the counter. Is this subject to GST? 

No, any medicine sold over the counter to its own patient/ employees which already has a medical record/ prescription with the hospital/ clinic is an exempt supply. However, if the patient is from another private hospital/ clinic, it is subject to GST at standard rate if the medicine is not listed in the NEML.

5. Hospital Pakar Rahman is a GST registered hospital and make both standard rate (e.g. additional bed for patient’s family member) and exempt supplies (e.g. treatment for cancer) to its patient. Can Hospital Pakar Rahman issue a tax invoice for both supplies?

Hospital Pakar Rahman can issue one tax invoice if the transaction involves both taxable and non-taxable supplies. However, you must have indicators to distinguish the different types of supply in the tax invoice. (For further information, please refer to the Guide on Tax Invoice and Records Keeping).

6. Hospital Kelana Medical Centre is a GST registered private healthcare facility which makes both taxable and exempt supplies. A patient came and was treated for diabetes illness at this hospital. Can Hospital Kelana Medical Centre issue a tax invoice for this exempt supply?  

Hospital Kelana Medical Centre must differentiate between the taxable and exempt supplies. The hospital must not issue tax invoice for services related to wholly exempt supply. The hospital would have to issue a normal invoice where it needs to have two (2) set of serial numbers, i.e., one set for tax invoices and another set for the normal invoices. Hospital Kelana Medical Centre must differentiate between the taxable and exempt supplies. (For further information, please refer to the Guide on Tax Invoice and Records Keeping)


Treatment 

7. A patient pays RM1,000 for the hospital bill. An agreement/ contract between an outsourcing doctor and the hospital states that 30% of the price charged to the patient (i.e. RM300) will be paid by the outsourcing doctor to the hospital for using the hospital space, facilities or operating cost. Is the charge of RM300 subject to GST? 

The charge of RM1,000 to the patient is not subject to GST as it is part of healthcare services provided by the hospital which is an exempt supply. The charge of RM300 by the hospital to the outsourcing doctor will be subject to GST as rental charges are taxable. The remaining RM700 which is the amount paid to the outsourcing doctor for his healthcare professional services is also subject to GST.

8. I am a professional doctor with a contract for service with the Jitra Medical Center. Are my healthcare professional services to the hospital subject to GST?

If you are registered under the GST, it is mandatory for you to charge GST on your healthcare professional services to the Jitra Medical Center. As a GST registrant, you are also entitled to claim input tax credit.

9. A numbered of hospitals team up together to setup a company to handle the logistic and support services where the cost and management expenses would be shared in order to cut cost and increase efficiency. What is the GST treatment on the services?   

Shared management services provided by a company will be subject to GST.

10. Putrajaya Group Berhad has 2 companies and a few licensed private healthcare facilities under it. One of the companies supplies consumable medical products other than medicines (for example gloves, cotton wool) and another company supplies employment services mostly to their private healthcare facilities. What is the GST treatment on the services? 

The supply of consumable medical products is a taxable supply. A contract for services of healthcare professional is an outsourcing of services by the private healthcare facility which is also a taxable supply. Therefore both services will be subjected to standard rate.

11. Ahmad used Puchong Ambulance Services Sdn. Bhd. to transport him to Hospital Putra. What is the GST treatment on these ambulance services?  

The supply of ambulance services provided by Puchong Ambulance Services Sdn. Bhd. is subject to GST at standard rate because these services are not provided by the registered or licensed private healthcare facility.

12. Dr. Asmadi was invited to give a talk in a hotel regarding to his expertise at a medical seminar. What is the GST treatment? 

Giving a talk at a seminar is a taxable supply and will be subject to GST at standard rate. If Dr. Ahmad is a GST registered person, his supply (the talk) is subject to GST. However, if the talk is given free, then it is not subject to GST.

13. Acupuncture is also a form of healthcare service. Can the service be treated as an exempt supply?

Acupuncture is categorized under traditional and complementary medicines (TCM) which is subject to GST at standard rate.

14. I need to use an oxygen tank often at home so I rent it from the Pantai Putra Hospital. Is this subject to GST?

The rental of oxygen tank is subject to GST at standard rate.

15. Good Sight Eye Clinic rent an operating theatre in Pantai Putra Hospital to operate its patient. Will the invoice issued by the Good Sight Eye Clinic to the patient subject to GST?

The invoice issued by the Good Sight Eye Clinic to the patient for the operation will not be subjected to GST. On the other hand, the invoice issued by the Pantai Putra Hospital to Good Sight Eye Clinic for rental of the operating theater will be subjected to GST.

16. Puchong Hospital Sdn. Bhd. outsources its food catering services to Awie Food Catering Sdn. Bhd. Is this services subject to GST? 

Yes. Any supply of outsourced service by a licensed healthcare facility is subject to GST at standard rate.

17. Puan Mary owns Mary Beauty Slimming Centre Sdn. Bhd. which provides services related to healthcare such as gymnasium, spa, sauna and massage. What is the GST treatment on such services?  

Marry Beauty Slimming Centre Sdn. Bhd. is not a private healthcare facility that is a registered or licensed healthcare facility under the Private Healthcare Facilities and Services Act 1998 and the services provided are not categorized as healthcare services. Therefore services provided by any beauty slimming centre will be subjected to GST at standard rate. Input tax is claimable provided the company is registered under GST.

18. A registered Nurul, Nurin and Partner Clinic organized a health screening at the foyer of Superstore Rahman. What is the GST treatment for this service?

Health screening is considered healthcare service but this services is not given in the registered private healthcare facility. If the clinic charge for the health screening service, it will be subjected to GST. If there is no charge, free service is not a supply and not subject to GST.

19. Ahmad Pharmaceutical Co. Sdn. Bhd. supplies equipment to government hospitals. Is the company required to charge GST on the supply?

Supply of healthcare services by the government hospital is an out of scope supply. Under the GST (Relief) Order 2014, the government has given relief from paying GST on the acquisition of goods. Therefore, Ahmad Pharmaceutical Co. Sdn. Bhd. will not charge GST on his supply to the government hospital. On the other hand, Ahmad Pharmaceutical Co. Sdn. Bhd. is entitled to claim input tax incurred if it is a GST registered person.


Apportionment Rule

20. Some inpatients may require family members to stay with them at a private hospital. What are the services exempted under this scenario?

Food and bed to patients are exempted supplies. However, charges to family members are subject to GST. The private hospital has to segregate the bill between the exempt and taxable supplies based on the apportionment rule for the purpose of claiming input tax. (For further information, please refer to the Guide on Partial Exemption).

21. Hospital Putri Medical Centre also provides traditional and complementary medicine services (TCM) such as massage and acupuncture in a different wing. Is Hospital Putri Medical Centre making both exempt and taxable supplies?

Yes. Hospital Putri Medical Centre is making both exempt and taxable supplies. Hospital Putri Medical Centre can only claim input tax credit on its taxable supplies by using the apportionment rule. (For further information, please refer to the Guide on Partial Exemption).

22. Harmony Medical Supplier Sdn. Bhd. has two branches. One of them is Harmony Specialist Clinic and another one is supplying medical equipment using the same company registration number under SSM. How can Harmony Medical Supplier Sdn. Bhd. claim its input tax?

Harmony Medical Supplier Sdn. Bhd. is making both exempt and taxable supplies. Input tax is claimable only which relates to its taxable supply, based on the apportionment rule. (For further information, please refer to the Guide on Partial Exemption).

23. Hospital Mawar Medical Centre provides 70% of exempt supply and 30% taxable supplies. How many input tax can Hospital Mawar Medical Centre claim?

Hospital Mawar Medical Centre has to be a registered person under GST in order to make input tax claim (ITC). Input taxes are claimable for the 30% of the taxable supplies, based on the apportionment rule. (For further information, please refer to the Guide on Partial Exemption).



 
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Johor
18A & 20, Jalan Sasa 2, Taman Gaya, 81800 Ulu Tiram, Johor, Malaysia.
Tel +607-859 0410
Fax +607-863 1003
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S1-3, 1-21-01, Suntech @ Penang Cybercity (1575), Lintang Mayang Pasir 3, 11950 Bayan Baru, Penang, Malaysia
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