PreTax Health HSA – Other Questions

Should spouse and children be dependents or employees in our Health Spending Account?

Question:  We often get the question:  Should I set my spouse and children up as dependents, or employees with my PreTax Health HSA? Answer:  You can either register your children as dependents or as employees, however if they are employees they should be officially employed (even part-time) and issued a T4. Put another way, anyone [...] Read More...

What does an employer with a Health Spending Account do if an employee leaves the company?

Lauren asked us: “How long do employers leave the health spending account active for an employee who has stopped working for their company? According to the PHSP rules, it is a plan of insurance — the employer is effectively the insurer. Therefore technically (like with any other insurance) when the ‘insurance policy ends’ (i.e., the […]

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Employees, or Owner-Employees are HSA eligible, not Shareholders

  Steve R. owns a small incorporated IT consulting company and he asked us if he is HSA eligible if he is currently the sole employee (and owner) and he has taken used both income  (T4) and dividends (T5) as a means of drawing out income from his company  (based on his accountant’s recommendations). Answer:  […]

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Health Spending Account Claim Information

Michele asked us what type of receipt information is required from claims from private health centers, or on other HSA claims from an employee of a company. Answer:  Our adjudicators normally look for 5 key pieces of information.  The health spending account claim information includes: Who is performing service – if this is a particular […]

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An HSA must use a 3rd Party to Process Claims

In your FAQ, you say that CRA requires that an HSA must use a 3rd party to process claims. Can you please tell me specifically where this guidance is found? Answer: PreTax Health Spending Account PHSP Canada Hi Carol. This flows from section 248(1) of the Income Tax Act and is also discussed in IT339R2: […]

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Health Spending Account Privacy Considerations and the Adjudication Process

Todd asks about Health Spending Account Privacy Considerations and the Adjudication Process: Todd: I was told by one provider I spoke to before you guys that they wanted employees to send their claims to our company admin person first, and that our admin person would then send the claims over to the them, as a […]

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