Corporations are facing rising benefit costs combined with more restrictive contract wording in group insurance. A Private Health Services Plan lets them take advantage of a new approach that can save up to 30% and provide increased flexibility and control. No health questions or age limits apply. This is not insurance.
- Active shareholders
- Spouses (including common-law)
- Children under age 21 – unless registered as a full-time student at an institute of higher learning and under age 25.
Unincorporated/Self-Employed Individuals (Limits)
A Private Health Services Plan allows Unincorporated/Self-employed individuals to completely tax-deduct money spent on all eligible healthcare services. A PHSP works on its own or in combination with existing group insurance coverage.
Which is amazing considering that prior to 1998, there were only two ways for Self-employed individuals to pay for medical and dental expenses:
- Group Insurance - many services are not covered and are subject to both deductibles and co-insurance, (i.e.; Basic Dental 80/20).
- Pay cash - no or small tax credit based on the Canadian Revenue Agency’s (CRA) 3% medical tax credit rule.
The example below illustrates how a PHSP gives you a larger tax deduction. Using a net income of $50,000 per year with family medical expenses of $1,600 and a combined Federal and Provincial Income Tax rate of 25%.
Based on these numbers, with a PHSP your business can FULLY TAX-DEDUCT $1,760 instead of receiving a non-refundable $25 medical tax credit. And not only this year, but also every year for the rest of your life. Your lifetime savings could be in tens of thousands of dollars.
More questions about the Private Health Services Plan? Complete the online form or contact June Borlé at (604) 874-4429 or Toll-free (888) 880-2266.