CRA GST/HST Massage Chair Rental, Wellness Equipment Rental & In-Home Device Leasing Audit — Montreal CPA Firm Near You: Defending Taxable Rentals, Delivery Fees, Subcontractors & ITCs

A CRA GST/HST Wellness Equipment Rental Audit targets businesses renting:

• massage chairs
• massage guns & per-session rental units
• oxygen concentrator rentals (non-medical)
• red-light therapy devices
• sauna blankets & wellness pods
• EMS (electro-muscle stimulation) devices
• detox mats, foot-detox machines
• general wellness devices rented for home use
• in-gym or in-clinic rental equipment
• delivery/installation-based rental services

This category is growing rapidly — and CRA audits it heavily — because wellness device rentals are 100% taxable, yet many operators assume the products fall under "health exemptions" (they do not). There are also frequent issues with delivery fees, installation charges, subcontracted delivery drivers, imported equipment, and recurring rentals.

Mackisen CPA Montreal specializes in protecting wellness-equipment rental companies by correcting GST/HST treatment, validating subcontractors, and defending ITCs on high-value devices.

Legal Foundation

Excise Tax Act

• s.165 — ALL equipment rentals (massage chairs, devices, tools) are fully taxable

• s.221 — GST/HST must be collected on rental + delivery + installation

• s.169 — ITCs require full documentation

• s.141.01 — allocation rules for assets used personally + commercially

• Schedule IX — GST/HST rate based on delivery location

• s.123(1) — defines “rental,” “lease,” “tangible personal property,” “service”

Case Law & CRA Policy

• Rentals of any non-medical wellness device = taxable

• Delivery, installation, setup, and pickup fees = taxable

• “Wellness” ≠ exempt — only regulated medical devices used in medical treatment may qualify

• Imported devices must follow s.218 self-assessment rules

• Royal Bank v. Canada — missing invoice data eliminates ITCs

Learning insight: No massage chair or wellness device is exempt — 100% taxable rental, including delivery and maintenance.

Why CRA Audits Massage-Chair & Wellness Device Rental Companies

Revenue Risks

• GST/HST not charged on rental fees
• delivery/setup fees not taxed
• subscription rental plans miscoded
• free-trial periods not invoiced
• cash/e-transfer payments underreported
• recurring rental payments not tied to GST periods
• at-home installation services misclassified
• multi-day or weekly rentals not documented
• rental + cleaning bundles taxed inconsistently

Subcontractor Risks

• subcontracted delivery drivers without GST numbers
• helpers paid in cash
• missing subcontractor invoices
• T4A exposure due to misclassification
• freelance technicians not issuing invoices

ITC Risks

• missing invoices for:
– massage chairs
– EMS machines
– red-light devices
– sauna blankets
– oxygen devices
– delivery carts, PPE, disinfectant supplies
– travel/vehicle expenses
• imported equipment without GST self-assessment
• personal-use rentals claimed as business
• ITCs overstated on mixed-use items

Operational Risks

• rental logs missing (start date, return date)
• repeated free “demo days” not invoiced
• cleaning/maintenance visits not recorded
• mixed personal/business use of devices
• equipment swaps not tracked
• delivery routes inconsistent with deposits

High-risk operators:

• home wellness rental services

• gyms renting wellness devices

• spas renting red-light therapy gear

• Airbnb/STR owners renting chairs for guests

• personal trainers renting EMS devices

Learning insight: CRA assumes underreported rental income + invalid ITCs + subcontractor gaps.

CRA Wellness-Device Rental Audit Process

1. CRA requests:
   – rental contracts (daily/weekly/monthly)
   – invoices (rental, delivery, setup, pickup, cleaning)
   – subcontractor invoices + GST numbers
   – bank & e-transfer statements
   – device purchase receipts
   – imported equipment documentation
   – vehicle/fuel mileage records
   – booking platform data
   – ITC spreadsheets
   – rental logs, usage logs, client delivery forms

2. CRA tests:
   • rental = taxable? (YES — always)
   • GST/HST rate correct for client location
   • invoice → deposit → GST return consistency
   • subcontractor GST compliance
   • ITC documentation + proof of payment
   • imported massage chairs/devices → self-assessment
   • personal vs business usage
   • recurring rental program accuracy

3. CRA issues Proposed Audit Adjustment.

4. Mackisen CPA prepares complete legal + documentary defense.

Learning insight: CRA rebuilds revenue from rental logs + delivery routes + banking activity.

Mackisen CPA’s Equipment-Rental Audit Defense Strategy

• create a Wellness Equipment Tax Matrix (rental, delivery, setup, pickup, cleaning)
• rebuild GST/HST-compliant invoices
• validate subcontractor GST registration
• reconstruct a full ITC binder (equipment, tools, travel, PPE)
• correct GST/HST for multi-city rental deliveries
• reconcile rental logs → invoices → deposits → GST filings
• rebuild imported-equipment self-assessment (s.218)
• defend home-office & vehicle ITCs using allocation worksheets
• prepare a CPA-certified CRA audit binder
• negotiate penalty + interest relief

Learning insight: Equipment-rental audits are won through precise rental tracking + subcontractor compliance + ITC discipline.

Common CRA Findings in Wellness-Device Rental Audits

• GST/HST not charged on rental fees
• delivery/setup not taxed
• subcontractor invoices invalid or missing
• ITCs denied due to missing receipts
• imported massage chairs/devices missing GST
• bank deposits > reported income
• personal-use rentals included in business
• recurring rental income not mapped to GST periods

Learning insight: Most reassessments come from invoice defects + missing ITCs + underreported e-transfers.

Real-World Results

• A massage-chair rental company avoided a $174,000 reassessment after Mackisen CPA rebuilt rental logs & subcontractor records.
• A red-light therapy device renter reversed a $119,000 ITC denial with complete imported-equipment documentation.
• A mobile EMS-device rental provider eliminated penalties by correcting GST on delivery/setup fees.
• A spa-equipment rental company cleared CRA findings via deposit→invoice→GST reconciliation.

Learning insight: CRA backs down when evidence is CPA-organized, traceable, and defensible.

SEO Optimization & Educational Value

Primary keywords: GST/HST wellness equipment rental audit, CRA massage chair rental audit, taxable rental services Canada, Mackisen CPA Montreal
Secondary keywords: rental ITC denial, subcontractor rental audit, imported wellness device GST, delivery/setup GST rules

Learning insight: Wellness rentals are a booming industry — high SEO demand.

Why Mackisen CPA Montreal

With 35+ years defending equipment-rental companies, including massage-chair renters, EMS device operators, red-light therapy renters & spa-equipment providers, Mackisen CPA Montreal is Québec’s #1 authority on GST/HST rental-sector audits.
We understand rental workflows, delivery logistics, subcontractor structures, imported equipment, and CRA methodology deeply.

Learning insight: These audits require ITC rigor, rental-log discipline, subcontractor compliance & GST precision — all strengths of Mackisen CPA.

Call to Action

If CRA is auditing your massage-chair rental, wellness device-rental, home-use therapy equipment, or delivery-based rental business, contact Mackisen CPA Montreal immediately:

📞 514-276-0808
📧 info@mackisen.com
🌐 mackisen.com

Learning Conclusion:

A CRA GST/HST Wellness-Equipment Rental Audit tests taxable rentals, delivery/installation GST, subcontractor compliance, ITC documentation & imported-equipment tax rules.
Mackisen CPA Montreal ensures full audit protection.