What is an HSA account?
An HSA (Private Health Services Plan) is a Canada Revenue Agency approved method to provide medical, dental and vision benefits in a tax efficient manner. A corporation can write off 100% of the costs related to its HSA. All expenses reimbursed are tax‐free to the employees.
Type of expenses that are covered
HSA as an Alternative vs. Supplementary plan
If you are a business owner and you have yet to have a traditional benefits plan, an HSA can be used to provide a complete range of coverage including medical, dental, and vision benefits to employees who otherwise could not get employer sponsored benefits. If you have a traditional insured group benefits plan, an HSA can be used to “carve out” infrequently used coverage such as orthodontics or vision care and make these types of benefits available in a Health Spending Account.
Should I Get a Health Spending Account?
Every business owner who has an incorporated company should have one. It is the most tax effective way to run health, dental, and vision expenses through the corporation. If an employer wishes to offer benefits to their employees, they can create a custom plan for their employees arranged by class.
How flexible is a Health Spending Account?
You have complete control over which employees are covered under the plan and what amount they can spend. The employees can get “classed” at the start of the benefit term and the limits of coverage are set based on the criteria designed by you and your advisor. You have complete control and may terminate anyone at any time.
If you want to understand more about Benefit Plans, please feel free to drop us a message here.
Jeff Devlin | Certified Financial Planner, Director
E & OE