What You Need to Know About a PHSP

What is a PHSP?

A PHSP (Private Health Services Plan) is a plan you can have for your business that is an alternative to traditional health insurance that offers tax benefits for you and your employees that can be used for medical expenses. You and your family members can take advantage of a PHSP for your health care needs. These health services include not just medical services but also dental, eye care, and a wide array of professional and cosmetic services.

A PHSP is 100% tax free for your employees and creates a 100% expense for the company for tax purposes. Your business will qualify as long as your business follows the guidelines the CRA has set out. To ensure your business qualifies, our experts are willing to work with you. Check out how our experts can help manage your PHSP here.

Will a PHSP help me save money?

There are three main ways a PHSP can help save you money. The first way is by being 100% tax free. This means you can deduct 100% of your medical costs from your taxes. The second is by avoiding expensive premiums that a traditional health insurance will have.

With a traditional insurance plan, your premiums will increase each year. They will also be determined by your age and you will be charged the same no matter how much you use. This is not the case for a PHSP. Most of the PHSPs have a fixed rate, doesn’t factor in age and you only pay for your expenses. And finally the third way is that a PHSP can remove the expensive deductibles that come with a traditional health insurance plan.

For example, since the PHSP will make the medical expense a before tax expense because your medical costs are tax free, whatever you spend on medical expenses is worth that much more. That means the higher your taxes and the higher your tax bracket, the more money you are saving.

How does a PHSP benefit the owner of a business?

If you own a business and are either the sole person in the business or not, a PHSP can help you. Businesses included in this are professional corporations and incorporated contractors and consultants. It can be difficult and expensive to insure people in these categories and they are often not considered by many traditional health care plans.

A PHSP not only covers your medical expenses, but also your family’s and makes them into a tax free expense for you. This means that not only is your and your family’s medical expenses now a business expense, it is also able to be deducted from your taxes. This is a great option for business owners. It is especially good for businesses with only one person. This also comes with all the money saving benefits and the coverage provided by the PHSP.

What is covered in a PHSP?

There is an extensive list of medical expenses that you can claim on your taxes for a PHSP. This includes prescriptions, many dental services, eye services and more. Cosmetic surgery is covered if it is determined to be medically necessary or for reconstructive purposes.

Being able to offer your employees and yourself with these plans is an attractive option for small business owners. You can claim your child’s braces, your laser eye surgery, and your loved ones prescriptions. Compared to traditional health insurance policies, a PHSP will cover 100% of many more services. Here are just a few items you are able to claim under a PHSP:

• Ambulance services
• Bathroom aids (such as railings, handles, etc.)
• Limb braces
• Cancer treatments
• Dental
• Hearing aids
• Laser eye surgery
• Walkers and mobility aids
• And more

Should you operate your own PHSP?

It may seem that managing your own PHSP may be worth doing by yourself. But for many people, it is not worth the time and effort. Just as you would hire a lawyer to manage legal issues. You should hire someone to manage your PHSP. The time you would have to run your business is worth it.

At Headquarters Inc., our team wants to provide the you the the best PHSP management services. Check out how we can help manage your PHSP today!