What is a Wellness Spending Account?
A Wellness Spending Account (WSA) is an opportunity for employers to support their employee’s wellness through the allocation of benefit dollars (taxable) for non-medical, wellness expenses. A WSA account can be used as a perk given to your employees to promote healthier lifestyles. You can incentivize employees with eligible categories such as gym memberships, holistic medicine, personal development courses, and more! Customize this list for employee needs. Support your remote workforce with ergonomic office equipment and gym equipment categories.
How Does a Wellness Spending Account (WSA) Work?
In its simplest form, a WSA provides the employee the flexibility to decide what wellness products or services they want to spend their money on. When setting up a WSA, an employer sets the dollar amount available to each employee to use for eligible expenses (as determined by the employer.
Let’s say an employer provides $1,000 WSA through ayaCare prepaid Mastercard card for their employee. The employee uses the prepaid credit card to buy a $875 rowing machine. This leaves $125 left on the card for other eligible expenses.
Employers can choose to roll over the remaining WSA balance to the following year, make arrangements that only used funds in a given year are available or even set up allotments monthly/quarterly. There is a ton of flexibility for the employer to set it up however it makes sense for their business and their employees.
Is a Wellness Spending Account (WSA) a Taxable Benefit?
Unlike a Health Spending Account (HSA), a WSA is a taxable benefit and is considered part of an employee’s total compensation package. WSA contributions will need to be included on an employee’s T4 statement. Some frequently purchased product and service expenses members partake in include:
- Personal training and consultation
- Gym, fitness centre, and annual memberships
- Hobby and general interest classes
- Smoking Cessation Programs
What is covered by a WSA?
A WSA is not regulated, and so the options for coverage are almost limitless! Employers decide what will be covered under their WSA and can set as many parameters (or as few) as they wish. Some carriers limit what can be covered under a WSA, but some common eligible expenses are:
- Personal training and consultation
- Gym, fitness centre and annual memberships
- Childcare
- Eldercare
- Hobby and general
- interest classes
- Education fees, tuition and books
- Smoking Cessation
- Programs
- Safety equipment
- Alternate transportation
- Legal services
- … and more!
Click here for a full list of potential CRA-approved WSA expenses
Every employer’s business is unique and they can individually choose what they are and are not willing to honour from the CRA-approved list. There is no set list for a WSA because employers can ultimately choose to cover as little or as many things as makes sense for their business and their employees.
Highlights of the HSA & WSA Employment Benefits prepaid health and wellness card:
- No out of pocket expenses. Submit out of pocket claims directly through app
- EFTs are sent swiftly when out-of-pocket claims are submitted. No more waiting for cheques in the mail!
- Claims can be submitted by taking a picture of the receipt through your phone camera
- No paperwork or large forms to fill out
- No having to save all your receipts in a shoebox
- Apps available for iOS and Android devices
Who is it for?
WSA’s work well for employers looking to offer some additional perks to their employees aimed at keeping them happy and healthy. A WSA can also keep an employer competitive in the job market by attracting and retaining top employees.
Your Health and Wellness Insights
If you’re curious how The HSA Group’s HSA and WSA health and wellness solutions can assist your business with employee engagement as part of your total compensation package, contact us today.
