Recently, the Canada Revenue Agency (CRA) confirmed that they consider extensions of up to 12 months reasonable. In addition, the CRA changed the eligible period to extend unused credits. This extension now applies to credits expiring between March 15, 2020 and March 16, 2021. Previously the period was to end on December 31, 2020.
To compensate for the reduced access to health and dental services, you can decide to extend your credits.
At this time, CRA is not likely to allow extensions beyond March 16. We recommend that you discuss this option with your tax consultant or advisor.
As a reminder, you can apply the extension to all types of HSAs with unused credits:
- balance carry-forward
- expense carry-forward, and
- no carry-forward
You may apply the carry-forward rules to your HSA at the end of your benefit year. At that time, we can provide you with a report on the unused credits your employees can carry forward.
Questions? We’re here to help.
For Clients with fewer than 50 employees, please contact your Client Service Administrator at 1-877-786-7227.
For Clients with more than 50 employees, please contact your Sun Life Group Benefits representative.