Tax and accounting for psychologists.
Whether you're building a private practice, contracting to a group clinic, or doing a mix of Medicare-rebated therapy and report work, you can generally claim your registration, clinical supervision and CPD against your income, and the purpose of a piece of work, treatment versus assessment for a third party, is what decides whether GST applies. This guide covers what psychologists typically claim, where GST gets complicated around reports, and how Medicare's Better Access billing reconciles into Xero. We're Brisbane based and work with psychologists across Australia.
Updated July 2026 · Reviewed by the LINK Advisors team
What psychologists can claim.
Ordered by typical value. Every claim still has to pass the ATO's tests: you paid for it, it relates to earning your income, and you can show a record.
AHPRA registration and indemnity insurance
Your registration fee and professional indemnity insurance are generally deductible as core costs of practising.
Clinical supervision costs
Both required and voluntary clinical supervision relevant to your practice are generally deductible.
CPD and professional development
Courses and training that maintain or build on your clinical skills are generally deductible.
Professional association membership
Membership fees for a relevant professional body are generally deductible.
Practice management software
Subscriptions to Halaxy, Power Diary or similar practice software are generally deductible.
Telehealth platform costs
Video consultation platforms used to deliver therapy remotely are generally deductible.
Testing and assessment materials
Standardised testing kits, manuals and assessment resources used in your practice are generally deductible.
Room rental or home office costs
Room hire in a shared practice, or the running costs of a home-based private practice, are generally deductible in the relevant proportion.
Mobile phone and data
The work-use portion of your phone and data for client contact and scheduling is generally deductible.
Professional library and resources
Journals and assessment manuals relevant to your clinical work are generally deductible.
GST and BAS, done right.
Psychological therapy is generally GST-free when it's supplied by a recognised psychologist as appropriate treatment for the client. Where you're preparing a report for a purpose other than that client's treatment, a workplace assessment, an insurance opinion, or a court-ordered report, the work can fall outside the GST-free medical service definition depending on what it's actually for, even though it looks similar to a clinical session on paper.
This distinction matters because plenty of psychologists build a meaningful part of their income from assessment and report work alongside therapy, and treating all of it as automatically GST-free is a common and avoidable mistake.
Medicare's Better Access rebates and private health fund payments don't change the GST treatment of your fee, they're just how the client is being reimbursed, so your invoicing needs to reflect the nature of the service itself, not who's paying for it.
The right structure for the work.
Plenty of psychologists start out contracting to a group practice while building a client base, which raises the same contractor-versus-employee question other allied health professionals face, and it's worth having reviewed properly rather than assumed. As your private practice grows, or you bring on associate psychologists under you, moving to a company structure and setting up a proper service arrangement for rooms and admin support usually starts to earn its keep.
Run the work, we run the numbers.
Halaxy and Power Diary handle bookings, clinical notes and Medicare claiming, and connecting them to Xero means your session fees, rebates and any report-writing income reconcile without manual entry. We help clients keep Better Access and private health billing tracked against what's actually landed, so nothing sits unreconciled at the end of the month.
Frequently asked questions.
Are my therapy sessions GST-free?
Generally yes, where you're providing appropriate psychological treatment as a recognised psychologist.
What about reports I write for insurers or courts?
These can sit outside the GST-free medical service definition depending on their purpose, since they're often not treatment for the client themselves. Worth confirming the treatment for your specific report work rather than assuming it matches your therapy sessions.
Is clinical supervision deductible?
Yes, generally, both supervision required to maintain your registration and voluntary supervision relevant to your practice.
Am I a contractor or employee at the group practice I work from?
It depends on the whole relationship, how much control the practice has over your hours and clients, not just what the agreement is titled. We can review your specific arrangement.
Should I set up a company as my private practice grows?
It's worth reviewing once you're taking on associate psychologists or the practice is generating income beyond your own personal effort, since a company structure and a proper service arrangement usually make more sense at that point.
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