Working for Families Rates for 2025-26: Credits, Thresholds, and Abatement
Updated Working for Families tax credit amounts, income thresholds, and abatement rates for the 2025-26 New Zealand tax year, including Family Tax Credit and In-Work Tax Credit.
Published 22 March 2026
Working for Families (WFF) is a package of tax credits available to New Zealand families with dependent children. For 2025-26, the credits provide meaningful income support to low and middle-income families — but the amounts depend on how many children you have, their ages, your family income, and whether you are in paid work. This article sets out the current rates, how abatement works, and how to ensure you receive what you are entitled to.
The Four Working for Families Tax Credits
Working for Families consists of four separate credits:
- Family Tax Credit (FTC) — the main component, paid per child
- In-Work Tax Credit (IWTC) — for families in paid employment
- Minimum Family Tax Credit (MFTC) — tops up income for low-earning working families
- Best Start — for families with newborns in the first three years
Family Tax Credit (FTC)
The Family Tax Credit is the core Working for Families payment. It is paid for every dependent child in your family.
2025-26 weekly rates:
| Child | Weekly rate |
|---|---|
| First/eldest child under 16 | $136.36 |
| Subsequent children under 13 | $111.46 |
| Subsequent children aged 13–15 | $121.84 |
| Children aged 16–18 | $136.36 |
Annual equivalents (× 52 weeks):
| Child | Annual rate |
|---|---|
| First/eldest child under 16 | $7,090.72 |
| Subsequent children under 13 | $5,795.92 |
| Subsequent children aged 13–15 | $6,335.68 |
| Children aged 16–18 | $7,090.72 |
Note: IRD adjusts these rates periodically. The amounts above reflect the 2025-26 year based on available data. Always confirm current rates at ird.govt.nz/working-for-families.
Example — two children (ages 7 and 10):
- Eldest child (under 16): $7,090.72
- Second child (under 13): $5,795.92
- Total FTC: $12,886.64 per year (before abatement)
In-Work Tax Credit (IWTC)
The In-Work Tax Credit is an additional payment for families where the parents (or sole parent) are in paid employment. To qualify:
- You must work minimum hours: 20 hours per week for single parents, or 30 hours per week combined for couples
- You must not be receiving an income-tested benefit (e.g., Jobseeker Support or Sole Parent Support)
2025-26 IWTC rates:
| Family size | Weekly IWTC | Annual IWTC |
|---|---|---|
| Up to 3 children | $72.50 | $3,770.00 |
| Each additional child over 3 | $15.00 extra | $780.00 extra |
A family with 4 children receives $72.50 + $15.00 = $87.50 per week ($4,550 per year).
Minimum Family Tax Credit (MFTC)
The MFTC tops up the income of low-earning families in paid work to a minimum threshold. It fills the gap between your actual income and the minimum income guarantee:
2025-26 MFTC threshold: $35,204 per year (the minimum net income after tax guaranteed to working families with children)
If a sole parent or couple (combined) earns less than $35,204 after tax while working the required minimum hours, the MFTC tops them up to $35,204.
This credit ensures no working family with children falls below the threshold purely due to low wages. It is less commonly needed now the minimum wage has risen, but it remains the backstop.
Best Start Tax Credit
Best Start provides support for families in the early years after a child is born.
| Year | Eligibility | Weekly rate |
|---|---|---|
| Year 1 (child aged 0–1) | All families | $69.00 |
| Year 2 (child aged 1–2) | Family income ≤ $79,000 | $69.00 |
| Year 3 (child aged 2–3) | Family income ≤ $79,000 | $69.00 |
From year 2, Best Start abates at 21 cents per dollar of income over $79,000. The credit ceases when the child turns 3 (or when family income is too high in years 2 and 3).
Income Threshold and Abatement
Working for Families credits (FTC, IWTC, and MFTC) abate as family income rises. The abatement works in two stages:
First Abatement
- Threshold: Family income above $42,700 per year
- Rate: 27 cents per dollar of income above $42,700
Second Abatement
- Threshold: Income above $56,600 per year (where the first abatement would otherwise reduce credits to zero)
- In practice, for most families the 27-cent abatement rate applies until credits are exhausted
Example abatement calculation for a family with 2 children (FTC only = $12,886.64 per year)
| Family income | Income above $42,700 | Abatement at 27% | WFF entitlement |
|---|---|---|---|
| $40,000 | $0 | $0 | $12,886.64 |
| $50,000 | $7,300 | $1,971.00 | $10,915.64 |
| $60,000 | $17,300 | $4,671.00 | $8,215.64 |
| $70,000 | $27,300 | $7,371.00 | $5,515.64 |
| $80,000 | $37,300 | $10,071.00 | $2,815.64 |
| $90,000 | $47,300 | $12,771.00 | $115.64 |
| $91,000 | $48,300 | $13,041.00 | $0 (fully abated) |
The income at which WFF is fully abated varies by family size — larger families retain entitlement at higher income levels.
Upper Income Cutoff
IRD estimates that families generally stop receiving WFF credits once their income reaches approximately:
| Number of children | Approximate income cutoff |
|---|---|
| 1 child | ~$73,000 |
| 2 children | ~$91,000 |
| 3 children | ~$107,000 |
| 4 children | ~$122,000 |
These are rough estimates. The IWTC adds to the total credits payable, raising the cutoff further for working families.
How to Receive Working for Families
You can receive Working for Families in two ways:
1. Weekly or Fortnightly Payments (Payments During the Year)
Apply through IRD’s Working for Families service in myIR. Payments are made weekly or fortnightly based on your estimated annual family income. You update your estimate if circumstances change (new child, income change, partner starts work).
At the end of the tax year, IRD squares up your actual entitlement against what you were paid. If you received too much, you will have a debt to repay. If you received too little, you will receive a refund.
2. End-of-Year Lump Sum
Alternatively, you can receive nothing during the year and claim the full entitlement at year end by filing an IR3 return. This avoids any risk of having to repay an overpayment, but means waiting until after 31 March 2026 and filing your return.
What Counts as Family Income?
WFF is calculated on family income — the combined annual income of both parents or the sole parent. Income includes:
- Wages, salary, and PAYE income
- Self-employment income (net of deductions)
- Rental income
- Interest and dividends
- Certain government payments
It excludes some tax-exempt income and certain benefit payments.
Changes Affecting 2025-26
The core WFF structure has been stable for several years. The Best Start payment and key credit amounts are adjusted periodically. For 2025-26:
- Core FTC and IWTC rates reflect adjustments made by the government
- The abatement threshold of $42,700 has been in place for several years
- Best Start thresholds remain at $79,000 for years 2 and 3
Always verify the current rates at ird.govt.nz before making financial decisions based on WFF entitlements.
Key Contacts and Resources
- Apply or update: myIR at ird.govt.nz/myir
- Estimate your entitlement: IRD’s WFF estimator tool
- Changes in circumstances: Report changes promptly to avoid an overpayment debt
Working for Families can make a significant difference to a family’s weekly income — for a couple with two children earning $55,000 combined, WFF credits could add $200 or more per week. If you have dependent children and have not checked your eligibility, it is worth doing so before the end of the 2025-26 tax year.