For financial planners and advisors
A benefit your incorporated clients ask about, administered by people you can call.
Most of your incorporated clients are paying family medical costs personally. A cost-plus Private Health Services Plan moves that spend into the corporation, deductible there and tax-free to the client, without an insurer or a premium. Medallion has administered them since 2016. Rod Burylo, CIM, FCSI, is one of our principals; he knows what you can and cannot say to a client, and what you need in writing before you say it.
- Reviewed by people, not an algorithm
- Your data is hosted in Canada
- 2FA on every login
- Administering PHSPs since 2016
It comes up in every review
Health costs are a line in every client's cash flow. A PHSP is a concrete, low-risk answer that does not need a product sale.
Fits beside insured coverage
A PHSP is not insurance and does not replace disability or critical-illness coverage. It pays the routine bills insurance was never meant to.
Disclosed and documented
Referral compensation comes with a written agent agreement and a client-facing disclosure line at application. If you cannot accept referral fees, your code runs uncompensated.
A worked example
Your own practice: an incorporated advisor, on the partner rate
$5,000 in a year on dental, glasses and physiotherapy for the family. Marginal rate 42%, corporate rate 11%.
Paid personally
$8,621
earned before tax to have $5,000 left for the bills. $3,621 of it goes to income tax first.
Paid through the plan
$5,420
the bills, our 8% fee ($400) and GST on the fee ($20), paid by the corporation and deducted. You receive $5,000 tax-free.
Kept, every year
$3,815
between you and the corporation, after our fee: the personal tax skipped, plus the corporate deduction and the GST recovered.
That is your own plan at the partner rate of 8%. Your referred clients pay the standard 10%, with the $375 set-up fee waived when they use your code. An illustration, not tax advice; your salary and dividend mix, province and other credits change the exact figures.
The referral partner offer
Three things, in plain terms
Your own plan
Set-up fee waived, and an 8% administration fee instead of the public 10%, for as long as you are a partner.
Your clients
The $375 set-up fee is waived for every client who applies with your code. They pay the standard 10% on claims.
You
10% of the administration fee on every claim your referred clients make, paid by EFT when your balance reaches $50 (waived in December), one T4A a year.
The honest arithmetic: 10% of a 10% fee is 1% of what a client claims, about $100 a year on a client who claims $10,000. The bigger number, the $375 waiver, goes to your client, which is the right way round for someone putting their name behind a recommendation. Full terms on referrals and compensation.
Your numbers
What your own plan would save you
Three quick questions. Nothing you enter is stored. The fee here is the 8% partner rate.
Dental, glasses, prescriptions, orthodontics, physiotherapy, and more, for your whole family.
$5,000
2. How much tax do you pay on your last dollar earned?
Your “marginal rate”: combined federal + provincial, approximate; it varies a little by province. Just pick the income closest to what you pay yourself, or use the slider.
3. What income tax rate does your corporation pay?
Combined federal + provincial. Most owner-managed corporations pay the small business rate on active income, roughly 9–12%, depending on province.
Your estimated tax savings
$3,815
kept between you and your corporation, every year you claim, after our fee.
Where those savings come from
Today, without a plan
You pay personally
To put $5,000 in your pocket for the bills, your corporation pays you $8,621, because at your 42% rate, $3,621 goes to income tax first.
$8,621 total
With a Medallion PHSP
Your corporation pays directly
The same $5,000 of bills is paid by your corporation, plus our 8% fee ($400) and GST on the fee. You're reimbursed the full $5,000: no income tax, because it isn't income. A PHSP reimbursement is designed to be a tax-free benefit under CRA's rules.
$5,420 total (bills + $420 fee & GST)
And the corporation's books
The whole thing is a deductible business expense
The $5,000 of bills plus our $400 fee is fully deductible against your corporation's income, and the GST on the fee comes back as an input tax credit. At your 11% corporate rate, delivering $5,000 of health care ends up costing the corporation just $4,806 after tax, money that was never taxed in your hands either.
| Corporation pays out (bills + fee + GST) | $5,420 |
| Income tax saved on the $5,400 deduction (11%) | −$594 |
| GST recovered as an input tax credit | −$20 |
| Net after-tax cost to the corporation | $4,806 |
Many medical and dental professional corporations make GST-exempt supplies and can't claim the credit; untick the box and the GST on the fee is treated as a cost instead (still deductible). Your accountant will know.
Common questions
I'm a licensed registrant. Can I accept a referral fee?
Often yes, with a written referral agreement and disclosure to the client; the specifics depend on your registration and your dealer or firm. Our agent agreement is written with that in mind and the disclosure appears on the client's application. Check it against your own obligations, or ask us to set your code to uncompensated.
What does my client pay?
With your code, nothing to start: the $375 set-up fee is waived. Each claim is the expense plus a 10% administration fee, plus GST on the fee. No premiums, no annual charge, no minimum claim.
What do I receive?
10% of the administration fee on every claim your referred clients make, for as long as they claim. It is paid by EFT once your balance reaches $50 (the floor is waived in December so balances settle in the year), and you get one T4A a year. On a client who claims $10,000 that is about $100 a year: a trailing income across your book, not a bounty.
What if I can't accept referral fees?
Tell us and we set your code to uncompensated. Your clients still get the set-up fee waived and you still get the value-add; nothing is paid to you and nothing is reported.
What do I have to do?
Sign the agent agreement, give us an email address for your login, and hand your code to the clients it fits. Your client applies online in about fifteen minutes. We onboard them, review every claim and answer their questions. You can see your referred clients and your balance in the agent portal.
Ready to refer?
Apply online and we issue your code, usually within a business day or two. Questions first? Ask a person.
- Reviewed by people, not an algorithm
- Your data is hosted in Canada
- 2FA on every login
- Administering PHSPs since 2016