SB Partners


In an industry where public opinion and accountability are vital, SB Partners offers you assurance and peace of mind.

Patient care is at the very heart of everything that you do. But your business is affected by many issues: changing consumer habits, staying at the leading edge of research and innovation, privatization, cost-savings, regulations, maximizing funding and minimizing taxes.

Our team has extensive knowledge in the Ontario health-care industry, and we stay abreast of the trends and issues affecting organizations like you. SB Partners is here to help you fulfill your mission within the community—whether you are a single practitioner, a family practice, a walk-in clinic or a hospital.

Benefit from the involvement of senior partners with many years in the health-care field, and get the personal attention that only a client-focused regional firm can offer.

Harmonized Sales Tax in Ontario

On July 1, 2010 the Ontario Retail Sales Tax (RST) will be combined with the federal Goods and Service Tax (GST) to create a federally administered Harmonized sales tax (HST). The HST would have a combined rate of 13% of which 8% would be the provincial portion and 5% would be the federal portion. The HST, except for some exceptions, would generally use the same rules and tax base as the GST.

What does this mean to medical and health care providers

  • Most services provided by medical and health care professionals are not currently subject to either the GST or the RST. Under the HST system, these services should remain exempt from the HST with no direct impact to the consumer. However, where supplies made by a medical or health care professional are taxable (e.g., therapeutic massages, cosmetic surgery, sales of goods such as toothbrushes, etc.), these supplies will be subject to the HST. This represents a significant increase to the price of these supplies to consumers and it is recommended that the tax status of these items be reviewed in detail prior to the introduction of the HST.
  • Currently, the RST applies to a relatively narrow base of goods and services used by medical and health care professionals in their practices. The HST will apply to a much broader base of goods and services, and medical and health care professionals will be required to pay additional non-recoverable tax on expenditures that are not currently subject to the RST. Examples of these expenditures include commercial rent, professional an association fees, professional accounting and legal fees, disposable face masks and surgical gauze. Consequently, for exempt medical and health care service providers, overheads will likely increase, since they will not be eligible to claim input tax credits, and these professionals may be forced to pass on the additional costs to their customers.

Medical and health care professionals should consider a number of strategic planning activities:

  • Consider stocking up on purchases of goods that currently do not attract the RST but that will attract the HST on July 1, 2010, thus reducing overall costs.
  • A medical or health care professional may wish to consider reviewing the business structure to determine the optimal treatment for income tax and HST purposes.
  • Review the impact of the HST on existing contracts with suppliers to determine whether suppliers’ costs will be positively affected by the implementation of the HST and, if so, to arrange for the purchase of these products at a lower price.
  • Medical and health care professionals considering purchasing real estate where to perform their services should do so before July 1, 2010 to minimize the taxes on the purchase of the of the property. Also, this will provide further savings if the medical professional currently rents a space to run the practise.

Next Steps

Talk to our Health Care Practice Group:

HST is here on July 1st - Be prepared with our free guide
What our Clients Say

Michael Andlauer, Chairman, Andlauer Management Group

“Our evolution to a national transportation and logistics group has provided many challenges. Over the last 10 years, the SB Partners team has contributed to our success by offering creative financial and business advice along the way.”