A Health Spending Account (HSA) covers health services that you need to be healthy, such as dental, optometry, prescription drugs, massage, physiotherapy, etc. It's meant to cover services that may not be partially or fully covered by your optional medical, drug, or dental coverage. Money spent from this account is tax exempt (except in Quebec). Under your employer's policy, your HSA is administered with Sun Life.
A Lifestyle Spending Account (LSA) covers many other services and products you can access to live a healthier life, such as: gym memberships, yoga, meditation, etc. Money spent from this account is a taxable benefit and will be taxed the following month after usage, on the 15th paycheque of that month. You’ll only get taxed on the funds you actually use. Under your employer's policy, your LSA is administered through League.
Money spent from your LSA will be taxed according to your marginal income tax rate as per Canada Revenue Agency (CRA) guidelines. Example: if you use $1,500 in LSA funds, and are taxed at 30% marginal income tax rate, then you will pay $450 in taxes.