New tool: work out the medical tax credit SARS owes you, and the extra one most people miss

Health and wellbeing
1

I have added another free tool to the site, a medical tax credit calculator that shows what SARS gives you back for belonging to a medical scheme.

Most people know about the first credit but not the second, and the two are quite different.

The first is the medical scheme fees tax credit. It is a fixed rand amount for every person on your medical aid, whatever plan you are on and whatever you pay. For the 2026 tax year it is R364 a month for you, another R364 for the first dependant and R246 for each dependant after that, so a family of four gets R14,640 for the year. If you earn a salary it is usually already built into your monthly PAYE.

The second is the additional medical expenses tax credit, and this is the one people forget. It gives some of your heavy medical costs back, your scheme contributions that ran unusually high plus the bills you paid out of your own pocket. Here age and health change everything. If you, your spouse or your child is 65 or older, or has a disability recognised by SARS, you get back a third of those costs with no income hurdle. For everyone else only the part above 7.5% of your taxable income counts, and you get a quarter of that, which is a high bar, so many younger people see nothing here.

The calculator does both. Pick your tax year, 2026 which is the one filing now, or 2027, enter how many people are on your scheme, and it shows your standard credit straight away. Open the extra section to add big contributions, out-of-pocket costs, or an age or disability, and it works out the second credit too.

One thing I made sure it is honest about, a tax credit can only reduce tax you actually owe, it is never paid to you as a refund on its own. So a pensioner on a small income whose tax is already zero may not get the full amount, and the tool warns you when that happens.

Try it here: Medical Tax Credit Calculator South Africa

The figures come straight from the SARS medical tax credit and income tax tables, and I will refresh them each year after the February budget. It is a guide, not tax advice, so confirm your own position with SARS or a tax practitioner.

Did you know there were two separate medical credits, and have you ever claimed the second one?

2

I am past 65 now, so this one was an eye opener. I always knew about the monthly credit on my medical aid, it sits right there on the tax certificate, but I had no idea the second credit was so much kinder once you cross 65. My wife has a chronic condition, and between her contributions and the bits the scheme does not cover, it adds up over a year.

What I appreciated most was the honesty about it not being a refund. My income is modest these days, so I could see a chunk of it would simply fall away, and the tool said so plainly instead of waving a big number at me. Most calculators never bother to mention that part.

One question while I have you. The out of pocket figure, does that include medicine I pay for outright when the scheme rejects it, or only the shortfall on claims it pays in part? I have a shoebox full of slips and I am never quite sure which ones actually count.

3

Good question Arnold, and both count. The out of pocket figure is any qualifying medical expense you paid yourself and were not paid back for, so the medicine the scheme rejects outright counts just as much as the shortfall on a claim it only pays in part. Doctor and dentist gaps, prescribed medicine you cover yourself, glasses, and similar all go in, as long as the scheme did not refund it.

The one thing to leave out is anything the scheme did pay back, since that would count it twice. So your shoebox is exactly the right instinct, keep every slip for what came out of your own pocket, add them up for the year, and put the total in the out of pocket box.

And because you are past 65, that whole amount works harder for you. You get a third of it back with no income hurdle to clear first, where someone under 65 only counts the part above 7.5 percent of their income. So it is well worth adding your wife’s costs up properly at tax time.