Technical Questions

What is the difference between traditional group coverage and CanHealth?

One Big difference is premiums.  See What Does it Cost for more info.

The other big difference is coverage.  CanHealth is Excellent for everyday expenses like vision, dental, chiropractor, massage, birth control, etc.  However, it does not include Long Term Disability, Life Insurance, Critical Illness, or any other coverage for catastrophic events. 

We strongly believe in the value of the above coverage and often combine CanHealth with more traditional coverage.  Please phone us to discuss.

What are the taxation rules governing CanHealth?

CanHealth and Dental Plans is as a Health and Welfare Trust (HWT) and a Private Health Services Plan ("PHSP"). The funds paid to a PHSP by an employer are business expenses deductible against business income.

What expenses qualify for reimbursement under CanHealth?

All expenses that qualify as “medical expenses” as defined under
subsection 118.2(2) of the Income Tax Act.  This includes many items not
covered by traditional medical and dental insurance coverage.

Click to see eligible expenses.

What is the maximum annual benefit under CanHealth?

Incorporated companies - Incorporated companies are permitted to set their own reasonable maximum annual limits.

Sole proprietors - Sole proprietors have an imposed maximum annual limit of $1,500 for an owner-manager employee, plus $1,500 for their spouse and $750 per child. If the sole proprietorship employs non-owner employees, then the limit for the owner is the greater of the imposed maximum or the limit provided to his employees.

Are shareholders eligible?

If shareholders are also employees they are eligible.

However, if an individual receives the benefits of the plan solely because they are shareholders the CRA is likely to argue that the plan is a shareholder benefit.  Shareholder benefits do not enjoy the same taxation advantages as CanHealth.

Small business owners should use caution if setting up a CanHealth Plan that includes shareholders only, and excludes non-shareholder employees.

We strongly urge anyone setting up such a plan to discuss the issue with an accountant.

Is there a maximum dollar limit that a Limited Company may reimburse employees through CanHealth?

No, but it should be reasonable in order to be deductible.  Please call to discuss.

Do all Employees have to receive the same benefit?

No, you can set different employee classes with claim limits based on levels of responsibility, tenure or family status.

Why do I need CanHealth?  I already write off my health expenses when I file my personal income taxes?

No, you don’t.

Many people believe that they already write off their medical expenses when they do their taxes.  In reality, they are only receiving a small amount of their money back.

The Medical Expense Tax Credit (METC) offers a tax credit for the medical expenses incurred by individuals and their families, not a tax deduction.

The METC is 15% of allowable medical expenses above $1,885 (or 3% of Net Income whichever is less.)

That means if you earn $40,000/year and have $3000 in medical expenses you will only receive a tax credit of $315.75. 

CanHealth offers far more savings as the full $3000 is a company expense, saving you all government deductions and income tax.  That means No CPP, No UI, No WCB and No Income Tax. 

CanHealth will guarantee that your savings from using our plan exceed our administration fee.

What about client confidentiality?

CanHealth manages all claims in accordance with the Privacy Information Act.  In this regard, employees can be assured that their employers will not know the details of their personal health expenses.  The company will only receive information regarding level of funds used.