Cost Plus offers businesses* (incorporated business, partnerships and sole proprietors) a cost efficient and tax effective manner to pay health care services.
Cost Plus is an inexpensive solution to deduct health-related expenses eligible under the Income Tax Act.
* Some limitations apply
If you are a sole proprietor you are allowed to deduct specific amounts from your income depending on the number of dependents you have. Your deduction limited are as follows:
Example: A family of four with two children under 18 would be allowed a total $4,500 per year comprised of $1,500 for each of the parents and $750 for each of the children.
If you have arms length employees (unrelated to you) on a full time basis your family deduction will be determined based on the coverage you provide to your employees. In other words, the amount that you can deduct must be equal to what your arms length employees are able to deduct.
Example: If you determine a dollar amount life $2,500 per year for your employee's family, then your family is also allowed the same amount per year.