Health insurance is something on everyone’s mind. When it comes to Canadian health insurance, many question as to whether or not it is a taxable benefit in Canada or not. This is something that comes up often and is important to small business owners.
What Is Health Insurance
First of all, it is important to understand health insurance and Canadian laws regarding health insurance. There are three different types of insurance offered in Canada. Health insurance can be defined as any type of coverage that can be given to an individual in the event of an event that affects the individual’s health, which could include coverage from an accident, a pre-existing condition or a disease. Health insurance coverage can include any factor or it can have exclusions in it, such as pre-existing conditions. These are also important things to consider when it comes to choosing which type of policy that you will want to have as an individual as well as the type of policy that you will want to offer to your employees as a small business.
Health insurance in Canada provides a myriad of services. It can cover things such as a visit to the doctor as well as any types of hospitalizations or surgeries that are needed for various reasons. It can also include things such as covering accidents as well as any sudden or serious illnesses that can occur. If you are Canadian, then you will also be covered for things such as catastrophic injury or accidents. This is not only covered by the different realms of insurance but it is covered for all Canadians by the government as a way to ensure that everyone can get the care that they need. Everything is included in this when it is deemed a catastrophic event such as medications needed or any drug therapies that are needed in order to cure it or to alleviate pain. Typically, in Canadian healthcare systems, natural or holistic care is not something that is covered.
Listed here are your options for Canadian insurance:
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Personal Health Insurance
One of the types of insurance that you can find in Canada is personal health insurance. This is a type of insurance that an individual can purchase from a private healthcare company that will offer them personal benefits rather than using one of the public healthcare options.
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Public Health Insurance
Another type of insurance that you can find in Canada is public health insurance. This is a type of insurance that is provided by the government. This is provided under an act called the Canada Health Act in order to allow for all Canadians to have access to health insurance at all times.
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Private Employer Insurance
You can also get private insurance that is sponsored by and offered by your employer. This is another type of insurance where your employer usually pays a portion, or all, of your premium.
Understanding the Limits of Insurance
Once you know and understand each type of insurance benefit that you can find within the Canadian insurance realm, then you can begin to understand whether or not these are taxable. When you provide health benefits as an employer and when they are completely paid for by the employer then they are tax-free for all of the employees that they are provided for.
When talking about a public health insurance plan, then these are also considered tax-free benefits as well. However, since this is paid for by the government, then it is essentially used with tax dollars in the first place, which makes it also unnecessary to make it taxable.
The last option is paying for private healthcare by pocket without government assistance or without the help of an employer. This type of insurance is taxable as it involves money paid by people with their own money after they’ve already paid taxes on that money. You can learn more from this site in order to determine the tax benefits in Canada. Doing your research will greatly help you to make an informed decision.
As you can see, there are numerous things to consider when trying to determine whether insurance in Canada is taxable or not. When it comes to determining which policies are taxable, then you have to first understand which type of policy that you are discussing as each policy is different and brings different elements to the table. It is important to do your research when determining what type of insurance to offer as a small business or what you can expect your employees to get.