Medical expenses deductions
You can receive a deduction of a certain amount for medical care costs paid for yourself or family members from your income for income tax purposes. This is referred to as medical expenses deduction.
You can receive a refund of part of the income tax paid by filing a final income tax return that includes information on medical expenses deduction.
This discussion merely touches on general aspects of medical expenses deduction. See the National Tax Agency website for more information. Contact your tax office for inquiries about individual and specific matters.
Expenses eligible for medical expenses deduction
The expenses in question must be medical care costs paid for the insured person or a spouse or other family member sharing the same livelihood during the period from January 1 through December 31 of the relevant year.
Amounts eligible for medical expense deductions
- ①Actual amounts paid at medical care institutions
- ②Amounts compensated by insurance, etc.
Examples of compensation amounts
- ・ Medical insurance benefits and hospitalization benefits paid under life insurance policies or other coverage (excluding compensation for time off work, insurance benefits based on income indemnity insurance, etc.)
- ・ Patient cost-sharing reimbursement, dependent medical care additional sum, High-Cost Medical Care Benefits, total high-cost medical care benefits and other additional sums, transportation expenses, Childbirth and Childcare Lump-sum Grant, medical care expenses, secondary dependent medical care expenses, etc. paid by health insurance (excluding Injury and Sickness Allowance, Maternity Allowance, etc.)
- ③If your total income during the year was less than 2 million yen, 5% of your total income
Deduction procedures
File a final income tax return with information on medical expenses deduction, with the required documents attached, with your tax office.
Under the tax system amendments made in FY2017, to claim medical expenses deduction when filing a final income tax return, instead of attaching receipts for medical care costs, you must attach a detailed statement of medical care costs. Accordingly, you can use the annual medical care cost information as details of medical care costs.
Note that this applies only if you are filing a final income tax return for 2017 or later in or after January 2018.
There are many points to note when using the annual medical care cost information as details of medical care costs. The main points are described in the annual medical care cost information.
Contact your tax office if you have any questions.
The self-medication tax system
This system was launched in January 2017 as an exception to the medical expenses deduction system.
If the annual amount of eligible Rx-to-OTC switch drugs (drugs requiring guidance or OTC drugs switched from ethical drugs) purchased during the year exceeds 12,000 yen, the amount in excess of 12,000 yen (up to 88,000 yen) can be deducted from total annual income for the year by filing a final income tax return.
- * You cannot use the medical expenses deduction system and the self-medication tax system at the same time. You must choose one or the other.
Subject period
January 1, 2017 – December 31, 2026
Eligible persons
Those who meet all three of the following conditions:
- Paying income tax and resident tax
- Purchased more than 12,000 yen’s worth of eligible OTC drugs per year (January – December), including those used by the spouse and other family members sharing the same livelihood.
- Underwent a specific health checkup, vaccination, periodic health examination, cancer screening, etc. to maintain and improve health and prevent illness during the year (January – December).
Drug purchase receipts are required when filing your final income tax return. Be sure to retain your receipts if you think you may use this system.
Contact your tax office if you have any questions.