Working for Families Tax Credits from Inland Revenue

The four type of payments

The four types of payments are:

1. Family Tax Credit: this is the family assistance payment that most families qualify for.
2. In-Work Tax Credit: this is a payment for families who normally work a minimum number of hours each week.
3. Minimum Family Tax Credit: this is a payment for families who earn up to $18,460 a year after tax from salary/wages, and who work a minimum number of hours each week.
4. Parental Tax Credit: this is a payment to help meet the needs that come with having a new baby and is for the first 56 days after your baby is born.

These payments are available for families with children whose income is under a certain amount and residence rules apply. If your family income includes an Income Tested Benefit, Student Allowance or New Zealand Superannuation, this may affect the type of payment you are eligible for, and how much you'll receive.

General Working for Families Tax Credits criteria

How much you can get depends on:

• how many dependent children 18 years or younger you have
• how much you and your partner earn - your family income
• where your income comes from (for example, salary or wages, business, Student Allowance, or a benefit)
• the age of the children in your care
• any shared care/custody arrangements
• how many hours you or your partner work each week.

How to get more information

For more details about Working for Families Tax Credits visit the Inland Revenue website or call them on 0800 22 77 73 (or 0800 37 77 74 if you or your partner are in business).

Paid parental leave

Paid parental leave is a government-funded entitlement for eligible parents when they take parental leave from their job to care for their newborn or adopted child (under the age of six).

The payment level is a flat rate equal to the eligible employee or self-employed person's previous earnings (up to a maximum that is currently $372.12 before tax per week). The payment amount does not depend on whether you have any other children or how much you earn.

If you are an employee, to be eligible, you must first qualify for parental leave from your job. You are entitled to Paid Parental Leave if you have worked for the same employer for an average of at least 10 hours per week for either six months or twelve months and no less than one hour in every week or 40 hours in every month before a baby's due date, or the date you assume care of a child with a view to adoption.

If you are a self-employed person, you are entitled to paid parental leave if you have worked an average of 10 hours per week for at least the last six months or twelve months before the baby's due date, or the date you assume care of a child with a view to adoption.

To find out if you qualify for Paid Parental Leave payments, or to order a Paid Parental Leave application form go to the Department of Labour website or call then on 0800 20 90 20.

Paid parental leave and parental tax credit

You cannot receive both paid parental leave and parental tax credit payments for the same child.

If you qualify for both you'll need to decide which payment you would like to receive. Once you have made your decision, you will not be able to change it.

For most people, paid parental leave payments will be higher than parental tax credit.

If you're eligible for both payments and you'd like some advice on which would be the better one for you, call Inland Revenue on 0800 37 77 77.