What is Working for Families?

Working for Families (WfF) is a package of tax credits for families with dependent children. It has four main components: Family Tax Credit (FTC) for any caregiver, In-Work Tax Credit (IWTC) for working families, Best Start for newborns, and the Minimum Family Tax Credit (MFTC) which tops up low working incomes. Payments abate (reduce) by 27 cents per dollar of family income above $42,700.

How much is the Family Tax Credit?

FTC for the 2026/27 year is $144 per week for the eldest dependent child, plus $117 per week for each subsequent child. Annual amounts: $7,488 for the first child, $6,084 for each additional child. The credit is for any principal caregiver (working or not), and it abates with family income.

How much is the In-Work Tax Credit?

IWTC is $97.50 per week per family for working families (which includes a temporary $50 boost). To qualify, the principal caregiver must work at least 20 hours per week (single parent) or the family combined must work at least 30 hours per week. The credit is per family not per child. IWTC abates with family income above $42,700 alongside FTC.

Best Start is $73 per week ($3,838/year) paid for every newborn from 1 April 2026, regardless of family income, for the child's first year. From the second year onwards, Best Start abates with family income (21 cents per dollar above $79,000) and stops at age 3. Note: Best Start is only available if the family doesn't receive Paid Parental Leave for the same child.

How does WfF abatement work?

Family Tax Credit and In-Work Tax Credit are both abated together. For every dollar of family income above $42,700, the combined FTC + IWTC reduces by 27 cents. Family income is the combined annual income of both partners (employee earnings, business income, rental income, etc.). High-income families lose entitlement entirely. Best Start has its own separate abatement starting at $79,000 family income (21c per dollar) and only from year 2.

NZ Working for Families Calculator 2026/27

Working for Families (WfF) provides four tax credits for families with dependent children: Family Tax Credit ($144/wk first child, $117/wk subsequent), In-Work Tax Credit ($97.50/wk per family including the temporary $50 boost), Best Start ($73/wk newborns), and the abatement formula reducing entitlement by 27 cents per dollar above $42,700 family income. This calculator handles all four components and shows where you sit relative to the abatement curve.

Updated April 2026 Uses 1 April 2026 WfF rates including IWTC $50 boost.

Family details

Number of dependent children

children

Children under 18 (or 18-19 if still in school) for whom you are the principal caregiver. Newborn babies under 1 year (for Best Start)

newborns

Each baby under age 1 receives Best Start regardless of income (year 1). Already counted in total children above. Cannot receive Best Start AND Paid Parental Leave for the same baby.

Income & work hours

Combined family annual income (gross)

Add both partners' gross income from all sources: salary, wages, business income, rental, taxable benefits. Eligible for In-Work Tax Credit?

IWTC is not available to families receiving an income-tested benefit (Jobseeker, Sole Parent Support, etc.) or NZ Super.

The four WfF components

Family Tax Credit (FTC)

Paid to any principal caregiver of dependent children, working or not. $144/week first child, $117/week each subsequent child. Annual: $7,488 first child, $6,084 each additional. Available to all families (including beneficiaries) but abates with income.

In-Work Tax Credit (IWTC)

Paid to working families: $97.50/week per family (includes the temporary $50 boost added in 2024). Requires 20 hrs/week single parent or 30 hrs/week combined for a couple. NOT available to beneficiaries. The credit is per family, not per child.

Best Start Payment

$73/week ($3,838/year) for every newborn during their first year, regardless of income. From age 1 to 3, Best Start continues but abates with income (21c per $ above $79,000). Cannot receive Best Start AND Paid Parental Leave for the same baby in the same period.

Minimum Family Tax Credit (MFTC)

A top-up that ensures working families on low income receive at least $36,036 net per year (after tax). Only relevant for families just above benefit levels who would otherwise be worse off working. Not included in this calculator's main flow but check IRD if your situation may qualify.

The 27% abatement

FTC and IWTC are abated together at 27 cents per dollar above $42,700 family income. So a family with $60,000 income loses ($60,000 - $42,700) × 0.27 = $4,671 from their combined FTC + IWTC entitlement.

Working for Families vs IETC

You cannot receive both WfF Tax Credits AND the Independent Earner Tax Credit (IETC). If you currently use the ME tax code (which gives IETC), you must switch to M when you start receiving WfF. Many families inadvertently double-claim and end up with year-end tax bills.

Sources

Related calculators

PAYE Calculator — income tax calculation
Take Home Pay Calculator — net family income
Tax Code Picker — M vs ME (cannot use ME with WfF)
Family Budget Calculator

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