Victoria, BC – September 15th, 2025 – Coastal Health Spending Accounts (HSA), a trusted provider of flexible, tax-advantaged employee health benefits in Western Canada, is proud to announce its official expansion into Ontario and Atlantic Canada, effective October 1, 2025.
After years of success across Western Canada, Coastal HSA is now bringing its innovative health spending account solutions to businesses and employees in new provinces, helping them manage healthcare expenses in a tax-efficient way.
“Expanding into Ontario and Atlantic Canada is a major milestone for Coastal HSA,” said Founder – Sam Froese. “ Employers across the country are looking for flexible and cost-effective ways to support their teams’ health and well-being, and we’re thrilled to bring our proven solutions to more Canadians.”
This post will explain:
- What changes with the expansion
- Key differences in tax treatment in Western Canada, Ontario, and Atlantic provinces
- An example showing $1,000 of health spending.
What’s New with Expansion
Employers in these provinces will need to understand what taxes must be collected when health claims are reimbursed and when admin fees are charged. We’ve updated our administrative processes to comply with provincial tax rules which vary by province.
Coastal HSA will begin accepting employers located in Ontario, New Brunswick, Nova Scotia, Newfoundland & Labrador and Prince Edward Island on October 1st, 2025.
Tax Treatment Across Provinces
Coastal HSA’s expansion also takes into account provincial tax rules. The tax treatment of HSAs differs depending on location of the employee:
| Province / Region | Tax on Claim Amounts | Premium / Insurance Tax | GST/HST on Admin Fee | Notes |
|---|---|---|---|---|
| Western Canada (BC, AB, SK, MB, Territories) | None | None | 5% GST on admin fee | Only the admin fee is taxed; claims are tax-free for employees. |
| Ontario | 8% RST on claims | 2% Premium Tax on claim + admin fee | 13% HST on admin fee | Layered taxes make Ontario slightly higher-cost for employers. |
| Atlantic Canada (NS, NB, NL, PE) | None | None | HST on admin fee (15% NB/NL/PE; 14% NS in 2025) | Only HST applies on the admin fee. |
Example: $1,000 HSA Claim
| Region | Claim Reimbursed | Admin Fee (6%) | Provincial Taxes | GST/HST on Admin Fee | Total Employer Cost |
|---|---|---|---|---|---|
| Western Canada and North | $1,000 | $60 | None | $3.00 | $1,063.00 |
| Ontario | $1,000 | $60 | $80 RST + $21.20 Premium Tax | $7.80 | $1,169.00 |
| Atlantic Canada | $1,000 | $60 | None | $9.00 (NB/NL/PE) $8.40 (NS) | $1,069.00 (NB/NL/PE) $1,068.40 (NS) |
Note: Employees always receive the full $1,000 tax-free; employer costs vary by province.
About Coastal HSA
Coastal HSA’s expansion into Ontario and Atlantic Canada on October 1, 2025 marks an exciting new chapter for businesses and employees across the country. With flexible, tax-efficient health spending accounts and transparent administration, Coastal HSA continues to make employee benefits simple, accessible, and valuable — no matter where your team is located.
For more information, visit coastalhsa.ca.
