You have questions. We have answers. Health Spending Accounts, explained.
An HSA is not only an alternative to a traditional benefits plan but it can also act a supplement to one. HSAs are used by small business owners all over Canada as a special account that is exclusively used to pay for health care services for you and your family. The main benefit of an HSA is it enables you to deduct 100% of your health and dental expenses - without paying premiums associated with a traditional group benefits plan.
The company makes a defined contribution on behalf of an employee(s) into the HSA. These funds are to be used on any covered medical expenses that are incurred by the employee. The main selling point of an HSA that makes it so valuable is that this is a non taxable benefit to the employee and a 100% business deduction to the employer. You determine the contribution amount when you set up the account. Once this amount is set it cannot be changed for the year, you can revise the amount of your defined contribution on an annual basis.
Simply put, a health spending account (HSA) saves you money. Health care expenses for your family and your dependents can be paid with pre-tax income rather than after-tax income.
You are a perfect candidate for an HSA if you own a business, have medical expenses and pay income tax.
We just need some info about you and your business and then setup is very simple. Start here.
Take a picture of it. Submit the picture on your smartphone or tablet(or an actual computer if that's your thing!). Get paid.
Simple, easy, and clear.
You are an even better candidate! The value of an HSA really shines when applied to an owner/operator/one person business. You and your family will benefit immensely from being able to:
Forget the restrictions of your traditional health insurance plans. The benefits of an HSA are endless. An HSA offers 100% coverage on a wide array of expenses. Someone in the family need physio? Fully covered. Someone need some new glasses? No limits. Someone want to get rid of their glasses forever and get laser eye surgery? !00% covered on . the HSA. See where this is going?
An eligible HSA expense, is a service performed by a licensed medical practitioner, and items must be prescribed by a licensed medical practitioner & dispensed by a licensed medical practitioner or a pharmacist.
Yes. As long as the employees fit into a clearly defined class, ex. owners, managers, employees, then you can set different limits for each class of employee. If two employees fall into the same class they need to be given the same limit.
Yes. Any premiums paid to an existing health and drug plan are an eligible expense and can be submitted under your HSA.
Yes. An Explanation of Benefits statement from the insurance carrier is needed. This can be submitted like any other claim, just snap a picture and submit.
There are a few ways that an HSA can be set up. The majority are set up on a percentage of funds deposited basis, usually from 12-15%. An HSA can also be set up on a smaller percentage base and a charge per claim basis. Talk to your advisor to see what would be applicable in your situation.
Make sense? Did we miss anything? Let us know.
Ready to get started. Sign up for an HSA here.