CPA for psychology clinics in Quebec.
A CPA practice that understands incorporated psychologists: simple or group practice structure, telepractice, and year-end coordinated with personal tax.
Why a generalist practice isn't enough.
A psychology clinic differs from many other health practices: very little equipment and inventory, services almost entirely exempt from GST/QST, often solo or small-group structures. Complexity lies elsewhere: compensation optimization, annual tax planning, and arrangements with associates.
GST/QST generally not applicable
Services rendered by a psychologist who is a member of the OPQ are exempt from GST/QST. You don't charge tax on services, but you also can't recover ITC/QST credits on expenses. Some adjacent services (training paid by organizations, certain insurer services) may have different treatment.
Often a single Opco, sometimes Holdco
For a solo psychologist-owner or with a few associates, a single Opco is often sufficient. A Holdco becomes relevant when accumulated profits exceed personal needs and a long-term planning vehicle is desired. The threshold depends on income level and retirement goals.
Service agreements with associate psychologists
Increasingly, psychology clinics use a structure where each psychologist is separately incorporated and bills the main clinic via a service agreement. This approach lets each psychologist optimize their own tax position. Agreements must be properly drafted.
Telepsychology and interprovincial billing
Telepractice introduces tax jurisdiction questions: if you offer remote sessions to clients outside Quebec, certain obligations may change. The corporate seat and the location where services are rendered are considerations to clarify with a CPA.
One mandate. The full annual cycle coordinated.
- CSRS 4200 compilation engagement adapted to a professional services practice
- Federal T2 and Quebec CO-17 corporate returns with SBD optimization
- Psychologist-owner T1/TP-1 personal returns (and spouse if shareholder)
- Verification of correct GST/QST treatment for exempt vs. taxable services
- Annual planning: salary/dividend mix optimization, shareholder loan management
- Opco/Holdco structure review as profit evolves
- Advisory on service agreements between incorporated psychologists
- Secure client portal communication throughout the year
Questions psychology clinics owners ask.
Are psychology services exempt from GST/QST?
Yes, services rendered by a psychologist who is a member of the OPQ are generally exempt from GST and QST. This means no tax charged on services, but no recovery of ITC/QST credits on expenses.
Some adjacent services may be treated differently: training paid by organizations, evaluations in a judicial expertise context, services to insurers. A GST/QST review by a CPA helps avoid errors.
When should a psychologist incorporate their practice?
Incorporation becomes interesting when your net professional income comfortably exceeds your annual personal needs. If all your profit is paid out personally, the tax deferral benefit of incorporation is largely theoretical.
As a guideline, many psychologists in private practice find incorporation relevant once net income allows them to retain earnings in the corporation. The exact threshold varies with personal situation, retirement planning, and goals.
What is the best structure for a group psychology practice?
Many group psychology practices adopt a structure where the main clinic is a corporation owning premises and administration, and each active psychologist is separately incorporated. Psychologists bill their services to the main clinic (or directly to clients) via service agreements.
This structure lets each psychologist optimize their personal tax position and retain some independence. It requires well-drafted agreements and precise accounting follow-up.
How does telepractice work tax-wise in Quebec?
Telepractice itself does not change the tax treatment of your income if you operate from Quebec and your clients are in Quebec. GST/QST treatment remains the same (exempt for psychological services).
If you offer services to clients outside Quebec or Canada, jurisdiction questions may arise, particularly for billing to foreign insurers. An analysis of your clientele helps clarify obligations.
How do you optimize the salary/dividend mix for an incorporated psychologist?
The optimal salary-dividend mix for a psychologist varies each year based on corporate income, accumulated RRSP contribution room, family situation, and current tax rules. There is no universal answer.
For younger psychologists with limited RRSP savings, a salary sufficient to maximize RRSP room is often relevant. For more established psychologists, a dividend-weighted mix may be more efficient. An annual review avoids the "one ratio forever" trap.
How much does a CPA cost for a psychology clinic?
JVS CPA's integrated annual mandate is priced at a fixed annual fee based on structure (Opco only vs. Opco/Holdco), number of associated psychologists, and complexity of the owner's personal situation.
For a precise quote, contact us.