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Taxability of various supplies to patients in GST

Taxability of various supplies to patients in GST:

Healthcare services are exempt in GST. Hospitals do many activities to facilitate the patients. In this article we will discuss about the taxability of various supplies to patients in GST. Services exemption notification no. 12/2017 CTR provide for exemption of healthcare services. Entry No. 74 of the said notification reads as “health care services by a clinical establishment, an authorised medical practitioner or para – medics” will be exempted under heading 9993.

Nowadays hospitals provide many supplies to their patients and also to the attendees with patients. We can divide the patients into two parts:

 Various supplies to In Patients:

The In patients are the patients who are admitted into the hospital. The in patients are provided with stay facility, medicines, consumables, implants , dietary foods and other items required in treatment. The medicine, consumables, implants used in providing healthcare services to in patients are naturally bundled in ordinary course of business. Even the room rent charges from in patients will be covered under the composite supply of healthcare services. Various advance rulings  have clarified this situation.

Advance ruling  of kerala AAR in case of M/s Ernakulam medical centre Pvt. Ltd. is relevant. It was held that all the supplies to in patients will fall in composite supply of healthcare. Another ruling of Kerala AAR in case of  M/s Rajgiri healthcare & education trust held the same. Again in case of M/s KIMS healthcare management it is clearly held that all supplies to in patients will fall in healthcare services.

Various supplies to Out Patients:

The out patients are the patients who visit the hospital for routine check up.  IN case of out patients the supply is for check up of patients. He has complete freedom to buy prescribed medicines from an outlet located outside Hospital. In this case supply of medicines to out patients will be chargeable as a separate supply. GST will be liable on sale of medicine to out patients.




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Profile photo of CA shafaly girdharwal CA shafaly girdharwal


New Delhi, India

CA Shaifaly Girdharwal is a GST consultant, Author, Trainer and a famous You tuber. She has taken many seminars on various topics of GST. She is Partner at Ashu Dalmia & Associates and heading the Indirect Tax department. She has authored a book on GST published by Taxmann.

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