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Private Health Insurance Plan Private Health Insurance Plans (“PHSPs”) were introduced by the Canada Revenue Agency a number of years ago as a way for various taxpayers to enhance health benefit programs for employees in a tax effective manner. Payments made by an employer for eligible dental and medical expenses to or on behalf of an employee will be deductible for tax purposes by the employer with no taxable benefit to the employee. In addition to the tax savings involved, a PHSP can add to the attractiveness of a business compensation program for its employees. A PHSP will often be more flexible than a traditional group health benefit program as the eligible benefits are based on the definitions of medical expenses in the Income Tax Act of Canada. They are available to both corporations and to self-employed individuals, which opens the door for many people who would not otherwise have been eligible for a traditional program. To review how a Private Health Insurance Plan could benefit your business please contact our office at (519) 746-3111. |
Professional
Corporations The ability for professionals such as Dentists, Doctors Lawyers and Accountants, to incorporate in Ontario has been around for a couple of years now, the province and the regulatory bodies that govern each professional group are still amending legislation and professional codes to improve the incorporation process and try to ensure the Ontario legislation is comparable to that available in other Provinces. One difference between Ontario and some of the other Provinces in Canada is the ability to have non-professional family members as shareholders. The 2005 Ontario Budget announced that professional corporations for medical doctors and dentists will be allowed to have non-professional family members as shareholders effective January 1, 2005. These changes, depending on their details, may make professional incorporation significantly more attractive that it has been since its origin. However, given the uncertainty of what the final legislation is expected to include, we recommend waiting until the legislation has been tabled before taking any steps towards incorporation. |
2005 Federal &
Ontario Budget Changes The basic personal tax credit amount for 2005 is $8,149 federally and $8,196 provincially (Ontario). The 2005 federal budget proposes that in addition to the indexation increases; the credit amount will increase each year by the following amounts: 2006 - $100 Similar increases are
proposed for the spousal/partner credit. The maximum contribution limited for Registered Retirement Savings Plans (RRSPs) and Registered Pension Plan (RPPs) have been increased through the 2005 federal budget to be as follows RRSP
RPP 2005 $16,500
$18,000 The 30% limit on foreign property held in pension funds, RRSPs, etc., has been eliminated with the 2005 federal budget as of 2005. | |