In Korea's year-end tax settlement, medical and education expenses get treated as “the receipts category” — keep the paperwork and you are done. Open the statute, though, and the two run on different rules, and both differ from the dependant deduction.
This post reads article 59-4 of the Income Tax Act (special tax credits) directly, copying paragraph 2 (medical) and paragraph 3 (education) and separating out the parts people get wrong.
⭐⭐⭐ The one line to know first. Both credits apply to a “person eligible for basic deduction” — but the clause adds a parenthesis: “not subject to the age and income restrictions.” ⭐ A family member excluded from the dependant deduction because of age or income can still count here.
⭐⭐⭐ What exactly does “not subject to age and income restrictions” release?
That parenthesis is the most important sentence in the article, and to see what it releases you have to read the basic-deduction clause beside it. So we opened it.
“A dependant falling under any of the following who lives together with the resident (including their spouse) … and whose aggregate income for the tax period is 1 million won or less (including a dependant whose only earned income totals 5 million won or less)
(a) a lineal ascendant … aged 60 or over
(b) a lineal descendant … or adoptee aged 20 or under
(c) a sibling aged 20 or under, or 60 or over”
— Income Tax Act, art. 50(1) item 3 (basic deduction) — 1.5 million won per person (translated)
| Requirement in art. 50 (basic deduction) | Under art. 59-4 (medical / education) |
|---|---|
| Age — ascendants 60+, descendants 20 or under, siblings 20 or under / 60+ | ⭐ Released |
| Income — aggregate income of 1 million won or less (or earned income of 5 million or less) | ⭐ Released |
| ⚠️⚠️ “lives together with” | ⚠️⚠️ Nothing says it is released |
⭐⭐⭐ This is where the misreading happens. The parenthesis in art. 59-4 releases exactly two things: age and income. The “lives together with” condition that opens art. 50 is not on that list.
⭐ So it reads like this: a family member kept out of the basic deduction by income or by age can bring their medical and education expenses in, but someone outside the frame of “dependant” altogether does not enter through that parenthesis. ⚠️ How “lives together with” is judged sits in the Enforcement Decree, which we did not open.
⭐⭐⭐ Medical expenses — the rate is not a single number
People say “15% for medical expenses.” The clause actually uses three rates.
| Item | For what | Rate | Cap |
|---|---|---|---|
| 1 | General medical expenses for eligible persons (excluding items 2–4) | 15% | ⚠️ ₩7 million a year |
| 2 | Self · aged 6 or under · 65 or over · disabled · serious, rare-incurable or tuberculosis patients | 15% | ⭐ No cap in the clause |
| 3 | Premature infants and infants with congenital anomalies | ⭐ 20% | No cap in the clause |
| 4 | ⭐⭐ Fertility treatment (including prescribed medicines) | ⭐⭐⭐ 30% | No cap in the clause |
⭐⭐ Item 2 matters most in practice. Expenses for yourself, children 6 and under, people 65 and over, the disabled and seriously ill are not caught by item 1's ₩7 million ceiling. In a year with a large hospital bill, that distinction changes the outcome.
⭐⭐ The two age tests are measured from opposite ends of the year
| Who | The date the clause names | ⭐ Effect |
|---|---|---|
| Aged 6 or under | “as at the first day of the tax period” | ⭐ Turning 7 during the year still counts, because January decides |
| Aged 65 or over | “as at the last day of the tax period” | ⭐ Turning 65 during the year counts, because December decides |
⭐⭐⭐ Opposite reference dates, same direction — each one lets the borderline year qualify. It looks accidental; it is what the clause says.
⭐ The 3% floor only has to be cleared once
Medical relief has a floor. Item 1 credits only the amount “exceeding 3/100 of total salary.”
Items 2, 3 and 4 each carry a proviso: “where the medical expenses under the preceding items fall short of 3/100 of total salary, the shortfall shall be deducted.”
⭐⭐ Read that backwards. The floor is not cleared item by item — it is cleared once, across the whole. Whatever is left unfilled by item 1 comes off item 2; anything still left comes off item 3, then item 4.
⭐ It reads as a structure designed not to make you clear the same floor four times.
⚠️ You need your total salary before any of this can be computed — the take-home pay calculator will give you that.
⭐⭐ Education expenses — the ceiling depends on who
Education has one rate: 15%. What varies is the ceiling.
| Who | Ceiling in the clause | ⚠️ Excluded |
|---|---|---|
| University students | ⭐ ₩9 million per person a year | ⚠️ Fees paid to a graduate school ⚠️ Fees paid using a student loan taken by the dependant |
| Pre-school children · primary, middle and high school students | ₩3 million per person a year |
The people covered are spouse, lineal descendants, siblings, adoptees and foster children. ⭐ Siblings are on that list — paying a younger brother's or sister's tuition lands here.
⚠️⚠️ Graduate school drops out of this item. The clause says plainly: “excluding education expenses paid to a graduate school or paid by the dependant using a student loan.”
⚠️ One age restriction survives, in exactly one place. Education is also “not subject to the age and income restrictions” — but the parenthesis continues: “provided that for the institutions under item 3(b), only persons under 18 as at the last day of the tax period.” ⭐ An exception attached to one category of institution, not to the whole clause.
⚠️ And education expenses exempt from income tax or gift tax are not credited. Tuition paid out of money that was never taxed — a scholarship, for instance — reads as falling outside.
⭐ Medical against education, side by side
| Comparison | Medical (para. 2) | Education (para. 3) |
|---|---|---|
| Rate | ⭐ 15% / 20% / 30% | 15% only |
| Floor | ⭐ 3% of total salary | None |
| Ceiling | Item 1 only, ₩7M; none stated for items 2–4 | ⭐ ₩9M / ₩3M per person |
| Age and income test | Released | Released (⚠️ one institution type: under 18) |
| ⚠️ Excluded | No separate exclusion in the clause | ⚠️ Graduate school · student-loan tuition |
⭐⭐ The real difference is where the floor and the ceiling sit. Medical relief starts only after a floor and caps only the general portion; education relief counts from the first won but caps per person.
Who counts as a dependant is covered in the dependant deduction article; the card-spending threshold is in this one. If you are renting, see the monthly rent credit, and for deductions you missed, the amended return.
Questions people ask
Do a parent's hospital bills count if they live elsewhere?
⭐ Age and income will not block it — art. 59-4 releases both. ⚠️⚠️ But art. 50's “lives together with” is not released. ⚠️ How that is judged when they live apart sits in the Enforcement Decree, which we did not open. ⭐ Check with the National Tax Service.
In a dual-income household, whose return should carry it?
⚠️ The clause does not answer that. It does offer a hint: the floor is 3% of total salary, so the lower salary has the lower floor. ⭐ That is read off the structure; the statute recommends nothing.
Is fertility treatment really 30%?
Yes. Item 4 of paragraph 2 sets “30 out of 100 in the case of item 4,” and the clause states that medicines prescribed in connection with the treatment are included.
Are graduate school fees excluded entirely?
⚠️ They drop out of paragraph 3 item 1, which says so expressly. ⭐ But item 1 governs dependants; a taxpayer's own education is handled by a different item. ⚠️ We did not open that item here.
Sources
- ⭐⭐⭐ Income Tax Act — art. 59-4 (special tax credits) (Korean statute portal, checked August 2026). Source for paragraph 2's “person eligible for basic deduction (not subject to the age and income restrictions)” and “15 out of 100 (20 for item 3, 30 for item 4)”, item 1's 3%-of-salary floor and ₩7 million cap, item 2's list (self · “aged 6 or under as at the first day” · “65 or over as at the last day” · disabled · serious, rare-incurable and tuberculosis patients), item 3's premature and congenital cases, item 4's fertility treatment including prescribed medicines, and paragraph 3's 15%, the ₩9M / ₩3M per-person ceilings, the graduate-school and student-loan exclusions, the under-18 rule for item 3(b) institutions, and the exemption carve-out. Paragraph 3 was last amended 23 December 2025. ⚠️ Quotations are our translation.
- ⭐⭐ Income Tax Act — art. 50 (basic deduction) (Korean statute portal, checked August 2026). Source for “1.5 million won per person”, item 3's “lives together with… aggregate income of 1 million won or less (including earned income of 5 million or less)”, and the age tests in (a) 60 or over, (b) 20 or under, (c) 20 or under or 60 or over.
- ⭐ Our own reading. That 30% is double 15%, and that the floor is cleared once across the whole, come from our reading of the proviso repeated in items 2–4 — that sentence is not written in the statute in those words.
What we could not verify
- ⚠️ How “lives together with” is judged. We opened the basic-deduction clause, but the test for family living apart sits in the Enforcement Decree, which we did not open. ⭐ What the article does state firmly is that art. 59-4 releases age and income only.
- ⚠️⚠️ A taxpayer's own graduate school fees. Excluded from paragraph 3 item 1, but we did not check how another item treats them. Nothing is asserted.
- ⚠️ Everything delegated to the Decree. “Medical expenses prescribed by Presidential Decree,” “education expenses prescribed by Presidential Decree,” and the definitions of serious illness, premature infants and fertility treatment all sit in the Decree. This article read the Act only.
- ⚠️ Which spouse should claim. Not something the statute decides. Only the structural hint appears above.
- ⚠️ Any actual credit amount. It depends on income, dependants and other reliefs, and cannot be computed from these rates and ceilings alone. ⭐ Use the NTS Hometax year-end preview.
As of August 2026. Rates, ceilings and reference dates come from art. 59-4 of the Income Tax Act, and the age and income tests of the basic deduction from art. 50; the multiples and the reading of the floor are flagged as ours. ⚠️ General tax information, not a guarantee that any particular filing is correct. Confirm specifics with the National Tax Service or a tax professional.
