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Understand Why a PHSP is Small Business’s best Health Care Plan Option
By CustomCarePlan | August 5, 2010
Small Business Owners have 3 options when it comes to paying for their health care expenses:
1. Using a Traditional insurance plan and paying monthly premiums.
2. Paying from your personal bank account (paying out of pocket with after tax dollars).
3. Your company paying these expenses by using a Private Health Services Plan (PHSP)
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The Best Option for Small Business Owners!
What is a PHSP?
A Private Health Services Plan allows you to expense your medical and dentals costs (for you and your employees) through your company. In 1988 CRA(Canada Revenue Agency) states that if your medical and dental benefits are administered through a third party arms-length administrator, they can be 100% tax deductible to your company These benefits are also not a taxable benefit to you or your employees. CustomCare has been a third party arms length administrator of PHSP’s since 1998. By using a PHSP and having CustomCare administer your benefits plan you can realize the maximum tax savings possible. Find out how much you could be saving annually by using a PHSP.
Who is Eligible?
If you have an incorporated business, limited company or sole proprietorship you qualify. The size of your business does not matter. You could be the only employee or you could have numerous employees.
How does it work?
Once you have enrolled your business you can start submitting claims immediately. All you have to do is submit your claim and receipts for the medical and dental services you have received. See example below.
FIRST…you pay your health or dental expenses as you normally would.
e.g. You pay your dentist $1000
SECOND…your employer or your company then sends CustomCare Inc. (the plan administrator as required by the CRA) the receipt and a cheque to cover the expense, along with a 10% administrative fee both of which are 100% tax deductible.
e.g. Company pays CustomCare a $1,000.00 Dental Expense, a $100.00 Admin Fee and $5.00GST (only on admin fee) Total is $1,105.00
THIRD…CustomCare Inc. then provides the employee personally with a tax-free reimbursement of the expense incurred and sends the company a tax receipt for the full expense and the 10% administration fee to claim as a business expense.
e.g. You receive your $1000 reimbursement tax-free and the company receives a receipt for $1105.00 which is 100% tax deductible to your business.
The claims process and issuing of reimbursement cheques typically takes between 5 and 7 days, you don’t have to wait weeks to get your money back.
The first step in getting started is signing up(More than 7500 other Canadian business owners and their employee’s use CustomCare). Setting up your plan is simple and you have the choice to do it all online in 2 easy steps @ www.customcare.ca or call a Benefit Specialist who can personally assist you in setting up your plan: 1-866-820-2188.
Topics: Canadian Health Care Plans, Flexible Health Care Plans for Canadian Small Business, Health Care Benefits For Small Business, PHSP - Designed for Canadian Small Business Owners, Tax Saving Tips For Small Business in Canada | No Comments »
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