Your group plan lets you provide your plan members
with comprehensive, cost-effective benefits coverage.
The Health Reimbursement Plan (HRP) takes that
coverage one step further by allowing you to
strengthen your coverage with valuable tax savings.
Before establishing a health reimbursement plan,
you should consult with your independent tax advisor
to review your needs and to determine whether a
reimbursement plan is ppropriate for your particular
- may be a tax-effective way to supplement health,
dental and vision coverage that may be limited or not
covered under your existing group plan
- allows you to provide enhanced benefits to your
key plan members in a way that is more tax-efficient
than salary increases
- is available to ICBA Benefit Services Ltd. plan
Who can be covered by an HRP?
An HRP provides coverage for a specific group of
key plan members, such as managers and executives.
members in this specific group must be eligible for
HRP coverage also extends to any dependent for
whom the plan member is entitled to claim a medical
expense credit under the Income Tax Act (Canada).
For example, HRP
coverage would also be available for the dependent
parent of a plan member, if the plan member is entitled
to a medical expense credit for the dependent
Which expenses are covered
HRP coverage supplements medical, hospital, dental
and vision expenses that are limited or not covered
under the terms of your existing group contract. Coverage
is provided for those expenses that qualify as a
medical expense under Subsection 118.2(2) of the
Income Tax Act (Canada), which may be amended
from time to time.
How does an HRP work?
In three easy steps:
- Claims for eligible expenses are submitted directly
to ICBA Benefit Services Ltd. You’re billed for the
claim, plus a 10 per cent administration fee and applicable
administration fee is a minimum of $5.
ICBA Benefit Services Ltd. may require payment of the
full amount before the claim is reimbursed.
- ICBA Benefit Services Ltd. issues a claim cheque to
the plan member for the amount of the expense.
- You write off the total claim and the administration
fee as a business expense to the extent allowed by the
Income Tax Act (Canada). The benefits received by
the plan member are not taxable (unless the plan
member resides in Quebec).
Cash in Advance
Payment to ICBA will be required in advance. The
claim will be paid once payment is received and it is
clear that the plan sponsor has agreed to accept responsibility
for the claim cost.
Available maximums range from $1,000 to $50,000.
maximum is combined for health, dental and vision
expenses, and is applied per person, per calendar
- An HRP gives you the opportunity to provide
additional benefits to your key employees
- HRP coverage is paid for with pre-tax business
funds, not personal disposable income
- The full benefit amount, including the administration
fee and associated taxes, is tax
deductible as a business expense to the
extent allowed by the
Income Tax Act (Canada). The benefit is not
taxable to the plan member (unless the plan
member resides in Quebec).
- There are no monthly premiums
The child of an executive plan member in your
organization requires a $3,000 orthodontic
organization’s group benefits plan covers basic
dental treatment only.
- The executive’s personal taxation rate is 40
- The HRP requires $3,000 plus a 10 per cent
administration fee, for a total of $3,300.
- The corporate tax rate for this business is 22
- The executive must earn $5,000 to have
$3,000 available to pay the expense.
- The organization pays the expense through
the HRP with $3,300 in corporate funds
- The $3,300 is tax deductible for the organization.
- The plan member receives $3,000 in nontaxable
- With a tax rate of 22 per cent, the net cost to
organization after tax is only $2,574
The HRP Advantage
Instead of spending $3,000 in after-tax dollars,
the plan member’s cost is reduced to $2,574
and is covered by the organization. The plan
member receives a $3,000 tax-free benefit
enhancement, and the expense is covered by
the organization in the most tax-effective manner.
Note: Sales tax and premium tax will be added
To sign up for HRP, please download this application form (PDF 161KB) and
fax it to us
For existing clients with HRP, download a claim form (PDF 161KB)
Acrobat Reader required to view pdfs. Free download, if needed.