Private Health Services Plan (PHSP): Who Qualifies and What You Get
Learn how self-employed individuals in Canada can use a Private Health Services Plan to pay for medical and dental expenses tax-efficiently.
A Private Health Services Plan (PHSP) is a way for people running their own businesses to pay for medical and dental costs using tax-deductible funds.
Who it's for
This plan is specifically for individuals who are self-employed.
What you get
It provides a method to cover various medical and dental expenses. Because it is a formal plan, these payments can be used to reduce your taxable income.
What it costs you
There are costs involved in setting this up. You will typically need to pay initial setup fees and ongoing annual administration fees to manage the account.
The catch to know
You must be operating as a business owner to qualify for the tax deductions. It is not available for standard employees.
How to apply
- Confirm that your self-employment status meets the requirements for a business owner.
- Find a provider that offers these approved plans.
- Pay the necessary setup and administration fees.
- Use the account to pay for eligible medical or dental expenses.