Working for Families Tax Credits: A Complete Guide

Changes effective 1 April 2026 (2026-27 year, per Budget 2025 RIS): WfF abatement threshold lifts from $42,700 to $44,900 and abatement rate lifts from 27% to 27.5%. Best Start year-1 payment is now income-tested at $79,000 / 21% for babies born on or after 1 April 2026 (universal year-1 retained for older babies). The 2025-26 figures below remain correct for that tax year (1 April 2025 – 31 March 2026).

Working for Families (WfF) is New Zealand’s main family tax credit programme, providing regular payments to help families with the cost of raising children. It’s income-tested, so the amount you receive depends on your family income and the number of children you have.

Types of Working for Families Payments

There are several components to Working for Families:

Family Tax Credit (FTC)

The main payment, available to all qualifying families. For the 2025-26 tax year:

Child’s age	Weekly rate per child
First child (16+)	$127
First child (under 16)	$113
Each subsequent child (16+)	$101
Each subsequent child (under 16)	$91

In-Work Tax Credit (IWTC)

An additional payment for families where parents work a minimum number of hours:

• Couples: at least 30 hours per week combined
• Single parents: at least 20 hours per week
• Amount: $72 per week for up to 3 children, plus $15 per additional child

Minimum Family Tax Credit (MFTC)

A top-up for working families whose income falls below a minimum threshold, ensuring a guaranteed minimum after-tax income.

Best Start Tax Credit

A payment of $73 per week for each child born on or after 1 July 2018, paid for the first three years. It’s not income-tested for the first year but becomes income-tested from year two.

Income Thresholds and Abatement

Working for Families payments reduce as your family income increases:

• Abatement threshold: $42,700 per year
• Abatement rate: 27 cents for every dollar of income above the threshold

For example, a family earning $70,000 with two children under 16 would have their payments reduced by: ($70,000 - $42,700) x 0.27 = $7,371 per year.

Who Is Eligible?

To qualify, you must:

• Be the principal caregiver of a dependent child aged 18 or under
• Be a New Zealand tax resident
• Have family income below the relevant threshold
• Not be receiving a student allowance (for IWTC)

Both employees and self-employed individuals can receive WfF payments.

How to Apply

1. Register with IRD through myIR (my.ird.govt.nz)
2. Complete the Working for Families registration
3. Provide your estimated family income and your children’s details
4. Choose to receive payments weekly, fortnightly, or as a lump sum at end of year

End-of-Year Square-Up

WfF payments during the year are based on estimated income. After the tax year ends, IRD compares your actual income to estimates. You may receive a top-up or need to repay overpayments, so keep your income estimate up to date.

Sources

• Working for Families — IRD
• Working for Families rates — IRD