GST and TDS on radiology reporting: what is exempt, what is taxed, and who deducts what

This guide is general information, not tax advice. GST and income-tax positions depend on how a contract is drafted and on rulings that change. Confirm your own position with a chartered accountant before invoicing or deducting.

Three rules cover almost every question a hospital, diagnostic centre or radiologist asks about tax on remote reporting. First, a report written by a registered radiologist is a health care service and is exempt from GST.¹ Second, the fee a platform charges for connecting the hospital to that radiologist is a support service and is taxed at 18 percent.³ Third, when the radiologist’s fee is paid through an e-commerce operator, TDS is deducted by the operator at 0.1 percent under section 194-O, and section 194-O(3) means the hospital does not also deduct 10 percent under 194J.⁵⁷ The rest of this guide explains where each rule comes from and what it looks like on an invoice.

GST on the radiologist’s service

The exemption is Entry 74 of Notification 12/2017-Central Tax (Rate), which exempts “health care services by a clinical establishment, an authorised medical practitioner or para-medics”. Health care services are defined as diagnosis, treatment or care for illness. An authorised medical practitioner is one registered with a recognised medical council, and a clinical establishment includes any institution offering diagnosis, which covers a standalone diagnostic facility.¹

Circular 32/06/2018-GST settled the question that matters for outsourced reporting: services by consultant doctors to hospitals are exempt.¹ A radiologist interpreting a CT or MRI and signing a report is performing diagnosis, so the fee for that report is exempt whether the radiologist invoices the hospital directly or a platform issues the invoice as the radiologist’s agent. The exemption follows the nature of the service and the status of the person providing it, not the route the invoice takes.

GST on platform fees and other services

Anything that is not diagnosis is outside the exemption. The clearest authority is Siemens Healthcare, decided by the Haryana Appellate Authority for Advance Ruling on 24 June 2020, which held that supplying diagnostic images to hospitals is not diagnosis and is taxable.² Ancillary services to health care, such as sample-collection outlets and other support functions, are taxed at 18 percent under SAC 998599.³

A teleradiology platform’s facilitation fee sits squarely in that category. It pays for the viewer, the assignment engine, credential verification, signing infrastructure, delivery and audit trails. None of that is diagnosis, so the fee carries 18 percent GST. The same is true of any separately charged technology service, such as an edge gateway rental, if a platform bills one. What matters is that the taxable fee and the exempt radiologist fee are shown as separate lines; a single blended “per report” price that mixes both invites an incorrect GST treatment on the whole amount.

Input tax credit

The 18 percent is a real cost. Input tax credit is only available on inputs used for taxable outputs. A hospital’s output, health care, is exempt; a radiologist’s output is exempt. Neither can offset the GST paid on the platform fee against anything, so it is not a pass-through.³ When comparing quotes, add the GST on the platform fee to the platform fee itself and compare that total to the radiologist fee, rather than reading the headline number. The teleradiology pricing guide shows how published Indian prices break down.

E-commerce operator rules

A platform that connects hospitals with radiologists and processes the payment is an e-commerce operator under the CGST Act. Section 2(45) defines an ECO as any person who owns, operates or manages a digital or electronic facility or platform for electronic commerce, and section 24(x) requires an ECO to register for GST regardless of turnover.⁴

The practical shape is a marketplace or agent structure: the radiologist supplies the exempt service to the hospital, the platform charges a taxable facilitation fee, and the platform issues the radiologist’s invoice as agent alongside its own fee invoice. The alternative, in which the platform contracts as principal to deliver reports and pays radiologists itself, makes the platform the clinical supplier and undermines the independent-contractor relationship that the teleradiology jobs guide describes.

TDS: 194-O versus 194J

Section 194-O applies where an e-commerce operator facilitates the provision of services by a participant. The rate has been 0.1 percent of the gross amount since 1 October 2024, down from 1 percent.⁵⁶ No deduction is made where the participant is a resident individual or Hindu undivided family with a PAN and the gross amount through the platform in the financial year does not exceed ₹5 lakh. The Income-tax Act 2025, effective 1 April 2026, carried the provision into section 393 with the rate unchanged.⁵

The part hospitals get wrong is subsection (3). A transaction covered by 194-O is not liable to TDS under any other section, so neither the hospital nor the platform deducts 10 percent under 194J on a radiologist fee routed through the platform.⁷ Section 194J at 10 percent still applies to professional fees a hospital pays a radiologist directly, outside any platform.⁸

The radiologist receives Form 16A for the deducted amount and claims it in their return. Whether the hospital must deduct anything on the platform’s own fee is a separate question that depends on the hospital’s reading of the fee and should go to its accountant.

A worked example

The figures below are illustrative only. They are not Raydiac’s rates, which are shared as a rate card during onboarding, and they are not a recommendation on any tax position.

Two things stand out. The GST is ₹27 on a ₹677 bill, because it attaches only to the ₹150 fee. And the TDS is fifty paise, not ₹50: had the hospital applied 194J at 10 percent it would have withheld a hundred times more from the radiologist than the law requires.

Payment flows and the RBI

Who holds the money is a regulatory question, not a convenience. The RBI Master Directions on Payment Aggregators of 15 September 2025 require any non-bank entity that collects customers’ payments and settles them to merchants to hold RBI authorisation, with a net worth of ₹15 crore at application rising to ₹25 crore by the third year, and to keep funds in an escrow with a scheduled commercial bank.⁹ A platform that receives a hospital’s payment into its own account and pays radiologists later is doing unlicensed payment-aggregator work.

The compliant pattern is an authorised aggregator’s split settlement. The hospital pays into the aggregator’s escrow; the aggregator settles the radiologist’s share to the radiologist’s linked account and the platform fee to the platform. The platform never holds client money, and the aggregator’s rules require that each linked account directly provides the service to the customer, which a reporting radiologist does.¹⁰ Prepaid hospital wallets or credit balances held by a platform raise the same concern and should be treated with caution.

What to tell your accountant

Most hospital accountants will default to deducting 194J on any doctor’s fee. A one-page note from the platform prevents a year of reconciliation. It should state, with citations:

• The radiologist is the supplier of an exempt health care service under Entry 74; no GST is charged on that line.
• The platform is an e-commerce operator registered under section 24(x); its facilitation fee carries 18 percent GST under SAC 998599; no input tax credit is available to the hospital.
• Section 9(5) does not apply to health care, so the platform is not the deemed supplier.
• TDS on the radiologist fee is deducted by the platform at 0.1 percent under 194-O (section 393 of the Income-tax Act 2025); under 194-O(3) the hospital does not deduct 194J on that portion.
• Funds settle through an RBI-authorised payment aggregator’s escrow, so the platform is not a payment aggregator.

How Raydiac invoices

Raydiac follows the agent structure described above. Each hospital or diagnostic centre receives one monthly invoice pack: a GST invoice for the platform fee at 18 percent, and the radiologist invoices for the exempt reporting fees, issued by Raydiac as the radiologists’ agent, with no GST on them. The rate card lists the radiologist fee and the platform fee as separate figures for each modality, study type, contrast, priority and shift. Payment settles through an authorised payment aggregator’s split settlement; Raydiac never holds hospital money.

Each radiologist receives a monthly payout statement showing gross fees, the 0.1 percent deducted under 194-O above the ₹5 lakh threshold, and the net amount, followed by Form 16A. Radiologists are independent contractors, never employees, so no salary TDS applies. The pricing page explains the rate-card structure and the radiologist salary guide covers what per-study income looks like after tax.