Health Care Spending Accounts (HCSA)
Flexible, tax-efficient health coverage for your business
An HCSA lets business owners and incorporated professionals cover medical expenses through the corporation – turning after-tax personal costs into tax-deductible business expenses.
How it works
Simple from start to finish
01
Set your annual budget
You decide how much the business will make available – for example, $5,000 per year.
02
Incur a medical expense
You or your family receives a medical or dental service – for example, $1,000 in dental work.
03
Submit the claim
You submit the receipt through the HCSA for reimbursement.
04
You get reimbursed
The corporation pays the claim and deducts the expense – and you receive it tax-free.
Real cost example
What a $1,000 claim actually costs
| Item | Amount |
|---|---|
| Total claims | $1,000.00 |
| Administration fee (10%) | $100.00 |
| Subtotal | $1,100.00 |
| HST on admin fee (13%) | $13.00 |
| PST (8%) | $80.00 |
| Premium tax (2%) | $22.00 |
| Total corporate cost | $1,215.00 |
Sample plan design
What a typical HCSA looks like
| Annual limit | $5,000 |
| Administration fee | 10% |
| Coverage | 100% of eligible expenses |
| Who is covered | Owner + family |
why it matters
Personal spending vs. HCSA – the difference is clear
Paying personally
~$1,500
Income needed before tax to cover a $1,000 medical expense out of pocket
Through HCSA
$1,215
Total corporate cost — tax-deductible for the business, tax-free for you
Save ~$285 on every $1,000 claim
Start covering medical expenses
the tax-efficient way
Abrams Insurance can help you set up an HCSA that works for your business structure and your family’s needs.