When you incur medical expenses, it is important to consider whether you qualify for the relevant credits/rebates. You may be eligible for two medical tax rebates as follows:
- Medical Scheme Fees Tax Credit (MTC): This credit applies where you make contributions to a registered medical aid.
- Additional Medical Expenses Tax Credit (AMTC): This credit applies to qualifying medical expenses paid by you that are not recoverable from your registered medical aid.
If you contribute to a registered medical aid for yourself and any dependents, you can claim the MTC. This credit is a fixed monthly amount for every month of your membership during the tax year. For the 2024 Tax Year (1 March 2023 – 28 February 2024) and the 2025 Tax Year (1 March 2024 – 28 February 2025), the calculation is as follows:
- R364 per month for the taxpayer who paid the medical scheme contributions (this credit is applicable even if your employer pays the contributions on your behalf) or for a dependent who is a member or a dependent of a member of a medical scheme or fund, where you are not a member of a medical scheme or fund but pay the contributions.
- R728 per month for the taxpayer and one dependent or R728 for two dependents where the taxpayer is not a member of a medical scheme or fund.
- An additional R246 per month for each additional dependent.
A dependent is defined to include the following:
- A person’s spouse.
- A person’s child and the child of a spouse (e.g., son, daughter, stepson, stepdaughter, legally adopted child). A “child,” as defined, is a person who was alive during any portion of the tax year and who, on the last day of the tax year:
- Was unmarried and was not or would not, had they lived, have been:
- Older than 18 years.
- Older than 21 years and was wholly or partly dependent for maintenance on the person and has not become liable to pay normal tax for the year.
- Older than 26 years and was wholly or partly dependent for maintenance on the person and has not become liable to pay normal tax for the year and was a full-time student at an educational institution of a public character.
- In the case of any other child, was incapacitated by a disability from maintaining themselves and was entirely or partly dependent for maintenance on the person and hasn’t become liable to pay normal tax for that year.
- Any other member of a person’s family for whom they are liable for family care and support (e.g., parents, parents-in-law, siblings, grandparents, grandchildren).
- Any other person recognized as a dependent of that person under the rules of a registered medical scheme or fund.
The AMTC is a rebate that reduces the tax payable by the taxpayer for qualifying out-of-pocket medical expenses. The AMTC is in addition to the MTC and can be claimed regardless of whether you are a medical aid member.
Qualifying out-of-pocket medical expenses include amounts paid and not recoverable during the year of assessment for you or any dependent and cover:
- Services rendered and medicines supplied by registered medical practitioners, dentists, optometrists, homeopaths, naturopaths, osteopaths, herbalists, physiotherapists, chiropractors, or orthopaedists.
- Expenses paid to nursing homes, hospitals, or registered nurses, midwives, or nursing assistants, including services supplied by nursing agencies.
- Medicines prescribed by registered physicians and acquired from registered pharmacists.
- Expenses incurred outside South Africa that are substantially similar to the services and medicines listed above.
- Any expenses prescribed by the Commissioner and necessarily incurred due to physical impairment or disability.
The calculation of the AMTC depends on the taxpayer’s age and whether the taxpayer or their dependents have a disability.
When claiming the MTC or AMTC, it is important to ensure that you have sufficient records (for example, receipts and invoices) available for inspection by SARS. If you are uncertain whether any expenditure qualifies for the AMTC, we recommend that you consult your tax advisor for assistance.