Medical Expense Deduction (医療費控除) Guide for Foreigners

How it works 医療費控除の仕組み

The medical expense deduction (医療費控除) is one of the most commonly used tax deductions in Japan — and one that many foreigners miss out on because they do not know it exists. Under 所得税法第73条, if you (or your household members living with you) paid more than ¥100,000 in medical expenses during a calendar year, you can deduct the excess from your taxable income.

This is not a tax credit (where you get the full amount back) — it is a deduction from taxable income. The actual tax savings depend on your marginal tax rate. If your marginal income tax rate is 20%, a ¥100,000 deduction saves you ¥20,000 in income tax plus approximately ¥10,000 in resident tax (住民税 at 10%). So the savings are real, but they are a percentage of the deduction amount, not the full amount.

Key points to understand:

• ● Household-based: You can combine medical expenses for yourself, your spouse, and any dependents (扶養親族) who live with you. This is a "household" (生計を一にする) concept — it does not matter who actually paid.
• ● Calendar year basis: Expenses from January 1 to December 31 of the same year are combined. You cannot carry over unused amounts to the next year.
• ● Requires 確定申告: You must file a tax return to claim this deduction. It is NOT available through 年末調整 (year-end adjustment by your employer). Even salaried employees who normally do not file 確定申告 must file one to claim 医療費控除.
• ● Maximum deduction: ¥2,000,000 (¥2M). This is the cap on the deduction amount, not on expenses.

What qualifies as a medical expense 対象になる医療費

The list of qualifying medical expenses is broader than most foreigners expect. The general rule is: expenses for diagnosis, treatment, or prevention of illness or injury qualify. Here is a comprehensive list:

Doctor and hospital expenses

• ✓ Doctor visit fees (診察料) — the copay you pay at clinics and hospitals (typically 30% of the total cost under health insurance)
• ✓ Surgery costs (手術費) — including your copay portion
• ✓ Hospitalization costs (入院費) — room charges, meals during hospitalization, treatment costs
• ✓ Prescription medicine (処方薬) — drugs prescribed by a doctor and purchased at a pharmacy

Dental expenses

• ✓ Dental treatment (歯科治療) — fillings, root canals, extractions, gum treatment
• ✓ Dentures and dental prosthetics (入れ歯, 差し歯) — if medically necessary and using standard materials
• ✓ Orthodontics for children (子供の歯列矯正) — braces for children with developmental dental issues are generally covered

Vision and eye care

• ✓ LASIK and vision correction surgery (レーシック, ICL) — these qualify as medical treatment
• ✓ Eye treatment — cataract surgery, glaucoma treatment, and other medical eye procedures

Pregnancy and fertility

• ✓ Pregnancy checkups (妊婦健診) — regular prenatal checkup costs
• ✓ Childbirth expenses (分娩費, 出産費用) — delivery costs at a hospital or birthing center (subtract any 出産育児一時金 received from insurance)
• ✓ Fertility treatment (不妊治療) — IVF, IUI, and other fertility treatments qualify

Transportation

• ✓ Public transportation to and from the hospital — train and bus fares to medical facilities. You do not need receipts for public transport; a written record (date, route, amount) is sufficient.
• ✓ Taxi to hospital in emergencies — when public transportation is not feasible (late night, severe condition, etc.)

Other qualifying expenses

• ✓ Nursing care services (介護サービス) — certain home nursing and care facility costs
• ✓ Acupuncture and massage (鍼灸, マッサージ) — when performed by a licensed practitioner for treatment purposes
• ✓ Medical devices — crutches, hearing aids prescribed by a doctor, and similar medical equipment

What does NOT qualify 対象にならないもの

The general rule for exclusion is: expenses for cosmetic purposes, general health maintenance, or prevention without a medical diagnosis do not qualify. Here are the most common items that foreigners mistakenly think are deductible:

• ✗ Cosmetic surgery (美容整形) — double eyelid surgery, rhinoplasty, Botox, teeth whitening, and any procedure purely for cosmetic purposes
• ✗ Health checkups and screenings (人間ドック, 健康診断) — routine health exams do NOT qualify. Exception: if a disease or condition is discovered during the checkup and you receive subsequent treatment, both the checkup cost and treatment costs become deductible.
• ✗ Dietary supplements and vitamins (サプリメント, ビタミン剤) — even if recommended by a doctor, OTC supplements are not deductible under 医療費控除 (though some may qualify under セルフメディケーション税制)
• ✗ Eyeglasses and contact lenses (メガネ, コンタクトレンズ) — regular prescription glasses and contacts for vision correction do NOT qualify. LASIK surgery does qualify, but glasses do not.
• ✗ Cosmetic dental work — adult orthodontics purely for cosmetic reasons, gold or porcelain veneers chosen for appearance rather than function, teeth whitening
• ✗ Private hospital room upgrades (差額ベッド代) — the extra charge for a private room, unless medically necessary (e.g., the doctor requires isolation for treatment)
• ✗ Parking fees at the hospital — unlike public transport fares, driving and parking costs are not deductible
• ✗ Massage and relaxation therapy — massages at non-medical facilities (リラクゼーションサロン) are not deductible, even if they help with back pain. Only treatment by licensed 鍼灸師 or あん摩マッサージ指圧師 qualifies.

How to calculate the deduction 控除額の計算

The formula for calculating your medical expense deduction is straightforward:

Let us break this down with examples:

Example 1: Standard case

Example 2: Lower income (threshold is 5%)

Example 3: Childbirth year

Which household member should file? Since 医療費控除 reduces taxable income, it is most beneficial when claimed by the household member with the highest marginal tax rate. If one spouse earns ¥8M (23% bracket) and the other earns ¥3M (10% bracket), the higher earner should claim the deduction for maximum savings.

セルフメディケーション税制 (Self-Medication Tax System) せるふめでぃけーしょんぜいせい

If your medical expenses do not reach the ¥100,000 threshold, there is an alternative: the セルフメディケーション税制 (Self-Medication Tax System). This is a special version of 医療費控除 introduced in 2017 that focuses on OTC (over-the-counter) drug purchases.

Here is how it works:

• ● Threshold: ¥12,000 (much lower than ¥100,000)
• ● Maximum deduction: ¥88,000
• ● What qualifies: Only designated OTC drugs marked with the セルフメディケーション税制 logo. These are drugs that were previously prescription-only (スイッチOTC医薬品) and certain designated general medicines. Look for the logo on packaging or receipts — many drug stores mark qualifying items on receipts.
• ● Prerequisite: You must have received a qualifying health maintenance activity during the year — this includes a company health checkup (会社の健康診断), a municipal health screening (特定健診), an influenza vaccination (インフルエンザ予防接種), or a cancer screening (がん検診). Keep proof of this activity.

Example: You spent ¥50,000 on qualifying OTC drugs (allergy medication, pain relievers, cold medicine, etc.) during the year and received your annual company health checkup. Your deduction is ¥50,000 - ¥12,000 = ¥38,000. At a 20% tax bracket, this saves you about ¥11,400 (income tax + resident tax).

Common qualifying OTC drugs include allergy medicines (アレグラ, アレジオン), pain relievers (ロキソニンS, イブ), cold medicines (パブロン, ルル), stomach medicines (ガスター10), and skin medications (ロコイド). When purchasing at a drugstore, the receipt will often mark qualifying items with a star or "セルフメディケーション対象" notation.

How to file for the deduction 申告方法

To claim 医療費控除, you must file a 確定申告 (tax return). Here is the step-by-step process:

1. Collect all receipts throughout the year. Every time you visit a doctor, pick up a prescription, or buy qualifying OTC drugs, keep the receipt (領収書). For transportation to hospitals, keep a written log with dates, routes, and amounts.
2. Prepare the 医療費控除の明細書 (itemized statement). Starting from 2017, you no longer need to attach individual receipts to your tax return. Instead, you prepare a summary statement listing each medical institution, type of treatment, amount paid, and insurance reimbursement received. The NTA provides a template (医療費集計フォーム) as an Excel file on their website.
3. Check for health insurance notifications. Your health insurer (健康保険組合 or 国民健康保険) may send you a 医療費通知 (medical expense notification) summarizing your medical expenses for the year. You can use this as a substitute for itemizing those expenses individually — it simplifies the process significantly.
4. File via e-Tax or at the tax office. The easiest method is the NTA's online filing system (確定申告書等作成コーナー at nta.go.jp). Enter your income information and medical expenses, and the system calculates the deduction automatically. You can also file in person at your local tax office (税務署) during the filing period.
5. Keep receipts for 5 years. Although you no longer attach receipts, you must retain them for 5 years from the filing deadline. The tax office can request to see them during an audit. Store them organized by year in a folder or envelope.

マイナポータル linkage: If you have a マイナンバーカード, you can link your health insurance data to the e-Tax system via マイナポータル. This automatically imports your medical expense data from your health insurer, reducing the manual entry work. The linkage requires a one-time setup but saves significant time in subsequent years.

For salaried employees: If you are a regular employee (正社員) and your only reason for filing 確定申告 is 医療費控除, you will need your 源泉徴収票 (withholding slip) from your employer, which you receive in January. Enter the figures from this slip into the e-Tax system, add your medical expenses, and the system will calculate your refund. The refund is typically deposited into your bank account within 1-2 months of filing.

Frequently asked questions よくある質問