How It Works
A Health Spending Account lets your corporation pay for medical expenses directly. It's 100% tax-deductible for your business and tax-free for you.
What is a Health Spending Account?
A Health Spending Account (HSA) is officially called a Private Health Services Plan (PHSP). It's been part of Canadian tax law for decades.
Instead of paying insurance premiums to a company that decides what's covered, your corporation reimburses you directly for medical expenses. The CRA treats these reimbursements as a tax-deductible business expense.
For Your Corporation
HSA expenses are 100% tax-deductible as Employee Benefits. This reduces your corporate taxable income.
For You Personally
Reimbursements are 100% tax-free (except in Ontario where there's a small employer health tax). No personal income tax.
Who Can Use an HSA?
You Qualify If:
- You own an incorporated business in Canada
- You pay yourself a salary (T4 income)
- OR you have employees and want to offer them benefits
You Don't Qualify If:
- You're a sole proprietor (not incorporated)
- You’re a shareholder only (no employment relationship)
- You're trying to sign up as an individual employee (HSAs are employer-sponsored)
Not sure if you qualify? We verify your eligibility during signup. If you don't qualify, we'll let you know before you pay anything.
The Math That Makes It Work
Here's why an HSA saves you money compared to paying out of pocket
Let's say you need $5,000 for dental work and you're in a 40% tax bracket
Without an HSA
You need to earn $8,333 to have $5,000 after taxes
With Frontier HSA
100% tax-deductible for your corporation
Your savings: $2,933
That's money back in your pocket, every year
Traditional Insurance
- Pay $200-500/month in premiums
- Premiums increase every year
- They decide what's covered
- Pre-existing conditions limited
- Unused premiums are gone forever
- Deductibles and co-pays add up
- Claims can take weeks to process
Health Spending Account
- Pay $0 in premiums
- Fixed, predictable pricing
- You decide what to claim
- Pre-existing conditions fully covered
- Only pay when you use it
- No deductibles or co-pays
- Claims processed same day
Pro tip: You can use an HSA alongside insurance. Use insurance for major events, HSA for everything else (including deductibles and co-pays your insurance doesn't cover).
Health Spending Accounts are officially called Private Health Services Plans (PHSP). They've been explicitly allowed under Canadian tax law for decades.
The CRA allows incorporated businesses to deduct HSA expenses as Employee Benefits. This isn't a loophole or a hack—it's simply how the tax code works.
Ready to get started?
Set up your Health Spending Account in 10 minutes. Start claiming expenses immediately. Keep more of your money.