Taxpayers are entitled to two medical credits:
- A credit on contributions made to your medical aid (Medical Scheme Fees Tax Credit); and
- A credit on additional medical expenses you paid that were not covered by your medical aid. This is called qualifying out-of-pocket medical expenses (Additional Medical Expense Tax Credit).
Medical Scheme Fees Tax Credit (MTC)
If you are a medical aid member, SARS grants you a monthly tax credit. The MTC is calculated for every month of your membership during the relevant tax year. For the 2023 Tax Year (being the period from 1 March 2022 – 28 February 2023) it is calculated as follows:
- R347 per month for the taxpayer who paid the medical scheme contributions (you get this credit even if your employer pays the contributions on your behalf); and
- An additional R347 per month for the first dependant; and
- An additional R234 per month for each additional dependant.
Additional Medical Expense Tax Credit (AMTC)
The AMTC is a rebate that reduces the tax payable by the taxpayer. It is mostly calculated against qualifying out-of-pocket medical expenses paid by you or any dependant. The credit is handled as a rebate to reduce your normal taxation. The AMTC is additional to the MTC and can be claimed irrespective if you are a member of a medical aid.
To claim the AMTC it is important to keep all the slips and invoices of your additional medical expenses as proof.
Calculation of AMTC works as follows:
If you are under 65 (without disability):
You are able to claim 25% of:
- Total contributions paid to the medical scheme
- Less (4 x medical scheme fees credit)
- Plus (qualifying medical expenses paid less 7.5% of taxable income)
If you are under 65 (with disability):
You are able to claim 33.3% of:
- Total contributions paid to the medical scheme
- Less (3 x medical scheme fees credit)
- Plus (qualifying medical expenses paid)
If you are 65 or over (with or without disability):
You are able to claim 33.3% of:
- Total contributions paid to the medical scheme
- Less (3 x medical scheme fees credit)
- Plus (qualifying medical expenses paid)