Medical and Travel Insurance
Health & Dental Insurance
Health & Dental Insurance can cover expenses not covered through your provincial health plan. Plans can be tailored to suit your individual needs and can be issued.
Emergency Medical Insurance
If you are travelling out of the country or out of the province, ensure you have emergency medical insurance prior to departure. This coverage will protect you in the event of an unforeseen accident or illness which requires medical attention. Your provincial health plan limits payment to what they would have paid out if that injury or illness occurred in your province. A payment which is typically much less than the cost out of province.
A Health Spending Account (HSA) is similar to a bank account in which you deposit a set amount of money each plan year. Contributions are recognized as a 100% business deduction. You can submit expenses incurred by you or your dependents that are deemed “eligible medical expenses” under the Income Tax Act for tax free reimbursement.*
The list of “eligible medical expenses” is long and varied, but will include all benefits found in traditional health care plans as well as many that are not. Some benefits not normally found in these plans include audiologist services, laser eye surgery, elderly parents and dependent care, fertility drugs and treatment, testing for scholastic ability in children and tuition for special needs education. Coverage is available to you and your family including older children, parents and other members of your immediate family who are financially dependent on you.
Each year you determine the amount of money you wish to fund your HSA based on the estimated annual health and dental expenditures for you and your family. Premiums are based on the contribution amount, administration fees and method of payment. With every deposit, you are charged an administration fee to cover the cost of adjudicating claims, plus additional taxes. On average this equates to 12% of your contribution amount.
There is no limit on the amount you can contribute as long as the amount is reasonable (your CA can be consulted if your desired contribution amount is questionable). Any excess funds not used in the year they are contributed roll over indefinitely.
The annual contribution limit to the plan is capped at $1500 per adult (18 years of age and older) and $750 per child. Excess funds that are not used within 24 months of contribution are forfeited. The amount of contribution allowable is pro-rated based on the tax year.
Full time employees can be added to your plan and given their own account. You can decide the contribution for your employees’ account each year.
The HSA provides a tax efficient and flexible way to provide benefits to your employees. This benefit is a better way to provide an increase in compensation as the benefit is tax free to the employee and the funds deposited do not require employer/employee CPP or EI remittances. For employees of a corporation, there is no limit on the contribution level and the funds roll over indefinitely. For employees of a non-incorporated entity, there is a limit of $1500/adult and $750/child and a 2 year rollover of funds.
- The tax issues discussed here are presented in broad and simple terms. Individual situations may affect the tax deductibility of the premium and tax free nature of the reimbursement. Consult your CA as to the tax implications of a HSA for you and your business.
- For incorporated physicians, the benefit provided through the HSA must be reasonable and provided by virtue of your employment status with the corporation and not that of a shareholder.
- For non-incorporate physicians the amount of premium that can be deducted as a business expense is limited to the amount of premium paid on your behalf for all full-time employees.
The changes in treatment of the HSA between incorporated and non-incorporated physician is a function of the terms of the Income Tax Act.