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Communtity Law Manual | Work & Income | The Working for Families tax credit package

Types of benefits

The Working for Families tax credit package

The Working for Families package includes:

  • the various forms of tax credit (see below) and
  • for non-beneficiaries, the Accommodation Supplement (see “Accommodation Supplement: Ongoing help with your rent” under “Other benefits and allowances”).

Tax credits can be paid by the Inland Revenue Department or, if you’re on a main benefit, by Work and Income.

Specific tax credits in the Working for Families package

Income Tax Act 2007, Part M

The Family Tax Credit (FTC) pays a certain amount for your first child and then a lesser amount for each subsequent child.

  • Beneficiaries and non-beneficiaries can get the Family Tax Credit.
  • You can get it for your children under 16; for children aged 16 or 17 if they’re still financially dependent on you; and for 18 year olds if they’re at school or doing tertiary education/training and still financially dependent on you.
  • Your FTC payments start reducing when you earn over a certain amount.

Here’s some information on the other Working for Families tax credits:

  • The In-Work Tax Credit pays a certain amount a week for up to three children and then an additional smaller amount for each additional child. The amount you get will be reduced (“abated”) if you earn income over a certain amount. To get the In-Work Tax Credit you need to be either working 20 hours each week as a single parent, or 30 hours per week between you as a couple. You can’t get it if you’re receiving a main benefit (including NZ Super), a Student Allowance, or earnings-related ACC payments.
  • The Minimum Family Tax Credit tops up net (after tax) wages to a certain amount a week. If the family’s total wages increase, the tax credit will reduce. The same 20 and 30 hours per week rule applies as for the In-Work Tax Credit. You can’t get the Minimum Family Tax Credit if you’re receiving a main benefit (including NZ Super).
  • The Best Start Tax Credit pays a certain amount a week for each child until their first birthday. The payments continue until age three if you and your partner’s income is under a certain amount. If your combined income is over that amount, the weekly payment reduces a certain number of cents for every dollar you earn over that amount. Best Start is available to beneficiaries and non-beneficiaries, but you can’t get it if you’re receiving government-funded parental leave payments.
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