Dealing with Work and Income
Earning income while on a benefit
How earning money might reduce your benefit (“Abatement”)
How much money will I get on a benefit?
Benefit rates are usually adjusted once a year, on 1 April. For information about the benefit rate that apply from 1 April, every year, visit: www.workandincome.govt.nz and search “April benefit rates”.
Each benefit has different rates, and the amount you get will be based on your personal circumstances. In particular, your benefit rate could change depending on your income.
Am I allowed to earn money while getting a benefit?
Yes, you’re allowed to earn money while on a benefit, but what you earn will affect the amount of your main benefit and whether you’re entitled to supplementary assistance.
Depending on how much you earn your benefit will be reduced by a certain amount (sometimes called “abatement”).
You can earn up to $160 before tax each week before your main benefit reduces. If you’re getting Temporary Additional Support, any increase in your weekly income will affect how much you get.
What does Work and Income consider my “weekly income”?
Social Security Act 2018, Schedule 3, s 13
Work and Income can choose to calculate your weekly income by either assessing:
- how much you were paid over the week, or
- how much you earnt over the week (for example, if you’re paid fortnightly).
If you’re getting Accident Compensation Payments (ACC), your benefit will reduce dollar for dollar for the amount of time your ACC payments cover (even if you are paid in a lump sum).
What if my income changes each week?
Work and Income pay you for the week that has just passed (in other words, “one week in arrears”). You have to declare your income for the week just been (often on a Friday before the working week is over).
You might have to predict how much you’ve earned before you actually get paid. If you underpredict your earnings, you could end up with a debt to Work and Income. If you overpredict your earnings, you can correct it later and Work and Income will pay you a top up the following pay week.
Can I get my income tested annually rather than weekly?
Social Security Regulations 2018, r 205, schedule 6
If it works out better for you, you can choose to have your income assessed annually rather than weekly if:
- you are a sole parent, or
- you are getting Supported Living Payment.
Calculating your income annually means you can smooth out your income against the past 52 weeks. You can earn $8,320 before tax each year before your benefit is reduced.
Work and Income default to an annual income test, but depending on how much you earnt and the period you earnt it, this can result in debt. If Work and Income has decided to review your income annually, but you think you would be better off on a weekly income test, you can request to review that decision (see: “Challenging Work and Income decision: Reviews and appeals”).
If I’m getting Jobseeker Support, how much can I earn before my benefit is reduced?
Social Security Act 2018, Sched 2 (“Income Test” definitions), Sched 4, Pt 1
| Weekly amount of income (before tax) | You’re single without kids, or you have a partner but they don’t qualify for a benefit (in their own right) | You have a partner who also qualifies for a benefit | You’re a sole parent, or you’re getting Supported Living Payment |
| $0 – $160 per week | Your rate of benefit is not affected. | ||
| More than $160 per week | Your benefit will reduce by 70 cents for every dollar of income you earn over $160. | Your benefit will reduce by 35 cents for every dollar of income you earn over $160. | Your benefit will reduce by 30 cents for every dollar of income you earn over $160.
If you earn more than $250 per week, your benefit will reduce by 70 cents for every dollar of income you earn over $250. |
When Work and Income won’t reduce your benefit
Social Security Regulations 2018, Schedule 8, clause 44
- If you are getting Sole Parent Support or the Young Parent Payment, Work and Income can ignore up to $20 of your earnings that you use to pay for childcare.
- If you are getting Supported Living Payment due to your health condition or disability, Work and Income can ignore up to $20 of your income if you worked for the money (“earned through personal effort”).
- If you are a severely disabled person, Work and Income has the discretion to ignore all or some of your income. This allows you to earn income without it affecting your benefit.
If I’m getting the Youth Payment or Young Parent Payment, how much can I earn before my benefit is reduced?
Social Security Act 2018, Schedule 4, part 6
| Weekly amount of household income (before tax). This includes your partners income if you have one. | You’re single | You have a partner |
| Up to $258 per week | Your benefit won’t be affected | Your benefit won’t be affected |
| $258 – $308 | Your benefit is reduced by $1 for every $1 you earn over $258. | Your benefit is reduced by 50c for every $1 that the two of you together earn over $258 |
| $308 -$358 | You won’t receive any benefit or incentive payments. | |
| More than $358 | You won’t receive any benefit or incentive payments. | You won’t receive any benefit or incentive payments. |
If you’re receiving the Young Parent Payment, Work and Income also has the discretion to ignore up to $20 of your earnings that you use to pay for childcare.
Tip: Each time you declare your income to Work and Income, keep a record of that declaration. Sometimes Work and Income will adjust your benefit based on information from Inland Revenue, which might not be the same as what you’ve declared. If Work and Income overpay you based on information from Inland Revenue, it’s important that you can show that you correctly declared your income at the time.
