NZ Working for Families Calculator

How Working for Families Works

Working for Families (WFF) is New Zealand's package of tax credits designed to help low- and middle-income families with the cost of raising children. Inland Revenue (IRD) and Work and Income jointly administer the scheme, paying eligible parents and caregivers either weekly, fortnightly, or as a lump sum at the end of the tax year. The four main components are the Family Tax Credit, the In-Work Tax Credit, the Best Start payment, and the Minimum Family Tax Credit — each with different eligibility rules and rates.

For 2025-26, the Family Tax Credit pays approximately $7,524 per year for your first child and $6,130 per year for each additional child. The In-Work Tax Credit adds $97.50 per week (about $5,070 per year) for working families with up to three children, with $15 per week extra per additional child. Best Start pays $73 per week ($3,796 per year) for each child under one, and continues to age three for families whose income falls below the abatement threshold.

Who Qualifies for Each Credit

To qualify for Working for Families, you must be the principal caregiver of a dependent child aged 18 or under, be a New Zealand tax resident, and meet the residency requirements for both yourself and the child. The Family Tax Credit is available to almost all eligible families regardless of work status — including those on a main benefit, though benefit recipients receive it through Work and Income rather than IRD.

The In-Work Tax Credit has stricter rules: you (or you and your partner together) must be working for salary or wages, with a single parent working at least 20 hours per week and a couple working at least 30 hours combined. Families receiving a main benefit or student allowance cannot claim the In-Work Tax Credit. The Best Start payment is available to the caregiver of any child born on or after 1 July 2018 — the first year is not income-tested, but payments from age one to three are reduced as family income rises.

Income Abatement Explained

Working for Families credits are income-tested. The abatement threshold for 2026-27 (from 1 April 2026) is $42,700 of annual family income. For every dollar of family income above this threshold, your combined Family Tax Credit and In-Work Tax Credit reduce by 27 cents. That is a 27% abatement rate, which compounds with your normal income tax to produce a significant effective marginal rate for families earning between about $43,000 and $70,000.

Best Start has its own abatement: after the child's first birthday, payments reduce by 21 cents per dollar of family income above $79,000, until the entitlement runs out. This calculator applies both abatement rules automatically to estimate your net entitlement. If your partner's income is variable or you have shared care arrangements, your actual entitlement may differ — IRD squares up the exact figures after 31 March each year.

How to Apply

Most families register for Working for Families through myIR at ird.govt.nz, either when they register the birth of a child or by completing an FS1 form. Once registered, you can choose to receive weekly or fortnightly payments throughout the year, or take a lump sum after 31 March. Weekly payments help with cash flow but require accurate income estimates — if you underestimate, you may owe a repayment at year-end; if you overestimate, you receive a refund. Always update IRD when your circumstances change — new partner, new child, change of job, or change of hours — to keep your payments accurate. Last updated: April 2026.

Current 2026 Working for Families Rates

From 1 April 2026, the Family Tax Credit (FTC) pays approximately $136 per week (~$7,072/year) for the eldest eligible child and $111 per week (~$5,772/year) for each subsequent child, paid weekly, fortnightly, or as a year-end lump sum by Inland Revenue. Confirm the current weekly figure on the official IRD Working for Families page before relying on it for budgeting. For PAYE earners modelling take-home pay alongside these credits, our NZ PAYE Calculator and NZ Income Tax Calculator show the full picture of net income.

The In-Work Tax Credit (IWTC) rises to $72.50 per week for families with up to three children, plus $15 per week for each additional child — provided a single parent works 20+ hours per week or a couple works 30+ hours combined. Best Start pays $73 per week (~$3,796/year) per child during the first year, with no income test. From age one to three, Best Start abates at 21 cents per dollar of family income above $79,000. For a deeper look at just one credit, see our dedicated In-Work Tax Credit Calculator and Best Start Payment Calculator.

The single most important number for 2026-27 is the abatement threshold of $42,700 from 1 April 2026. Above that, your combined FTC + IWTC reduces by 27 cents per dollar of family income — a steep effective marginal rate when stacked with PAYE and student loan repayments. KiwiSaver contributions and retirement projections (see our KiwiSaver Calculator) are calculated on gross income, so they are unaffected by abatement. Source: IRD WFF rates and the Work and Income WFF page.

Working for Families 2026 Changes & Sunset Provisions

Budget 2025 introduced the biggest Working for Families shake-up in years, with most changes taking effect from 1 April 2026 (the start of the 2026-27 tax year). The abatement threshold was lifted to $42,700 — up from the previous frozen level — meaning families keep more of their FTC and IWTC before the 27% claw-back kicks in. The Minimum Family Tax Credit (MFTC) guaranteed annual net income was simultaneously raised to $35,316, restoring the work incentive for low-income working families. Full Budget detail is on the Budget 2025 portal and the Beehive announcements.

The most significant sunset provision affects Best Start: from 1 April 2026, payments in the child's second and third years are income-tested against the same $79,000 threshold (with 21-cent abatement) rather than being universal. First-year Best Start remains universal. Parents nearing the end of their child's first year should re-run this calculator after their birthday to see the year-two impact, and check our Families Package Best Start 2026 Calculator for a 36-month projection. The Paid Parental Leave Payment Calculator helps model the overlap if you are still on PPL when WFF kicks in.

The new FamilyBoost tax credit (early childhood education rebate) sits alongside Working for Families — it is claimed separately through IRD rather than reducing WFF entitlements, so most families on WFF can stack both. However, FamilyBoost itself abates above $140,000 family income. If you are unsure how the credits interact, the official IRD Working for Families page is the authoritative source — this calculator is a planning estimate, not an entitlement decision. Run the numbers, then confirm with myIR.