Free Working for Families Calculator for New Zealanders
Working for Families combines the Family Tax Credit and the In-Work Tax Credit. From 1 April 2026 the IWTC is $147.50/week and entitlement abates at 27.5 cents per dollar of family income above $44,900.
Your family
Based on family income $75,000, 2 children, youngest age 5.
About our Working for Families Calculator
A two-child working family in NZ on a $76,000 combined income receives roughly $244 a week in Working for FamiliesWorking for FamiliesGovernment package of weekly tax credits (FTC, IWTC, MFTC, BSTC) for working families.View in glossary → credits in 2026/27, after the 1 April changes. The same family was getting around $209 a week under the rules before April 2026, and the gap is the result of three Budget 2025 settings: the In-Work Tax Credit lifted by $50 a week, the abatement threshold raised by $2,200, and the abatement rate increased by half a percentage point.
The calculator combines the four WFF components: Family Tax Credit (FTC), In-Work Tax Credit (IWTC), Best Start Tax Credit (BSTC) for children under 3, and the abatement that reduces the credits as family income rises above the threshold. Move the income slider to see where the credits taper to zero (around $103,000 for two-child families with both parents working).
The Minimum Family Tax Credit (MFTC) is a separate entitlement that tops up working families to $703 a week net if their family income would otherwise fall below that floor. The MFTC is rarely the binding figure but is worth checking with IRD’s estimator if your family income sits below $36,604/year.
How to use it
Enter your combined family gross income, the number of children, and the age of the youngest. Toggle the work flag on if a couple is working at least 30 hours/week between them, or a sole parent is working at least 20 hours/week.
The result panel returns the weekly entitlement, the maximum FTC and IWTC before abatement, and the abatement reduction at your income level. The annual figure (weekly × 52) is the headline number IRD reconciles at year-end.
For families with shared-custody arrangements or recently changed circumstances, the IRD’s estimate-your-entitlement tool handles the edge cases this calculator does not.
Why use it
WFF is the single biggest income-support package for NZ working families with children. For families above the $44,900 threshold, every $5,000 of additional household income reduces the weekly entitlement by about $26. Knowing where the entitlement sits helps with the cash-flow plan around a pay rise, a partner returning to work, or a side-business start-up.
The 27.5% abatement rate creates a high effective marginal rate above the threshold. A family in the 30% income tax bracket plus 27.5% abatement plus 1.75% ACC faces an effective marginal rate of roughly 60% on every additional dollar of family income, until the WFF entitlement runs to zero. The calculator surfaces the trade-off in pre-tax dollars, then take-home calculators handle the post-tax view.
For sole parents and couples with very young children, the BSTC adds another dimension. BSTC during a child’s first year is unconditional and adds $73/week regardless of income; for ages 1-3 it adds $73/week up to $79,000 of family income, then abates at 21 cents per dollar. The calculator handles BSTC where the youngest child is under 3.
The maths behind it
Weekly entitlement = max(0, FTC + IWTC − abatement) where abatement = (Family income − $44,900) × 27.5% ÷ 52 Family Tax Credit (FTC) is $144/week for the first child plus $117/week for each subsequent child. In-Work Tax Credit (IWTC) is up to $147.50/week per family that meets the work test (combined 30 hours/week for couples, 20 hours/week for sole parents). Abatement starts at $44,900 of family income and reduces the combined FTC + IWTC by 27.5 cents per dollar above the threshold. Best Start Tax Credit (BSTC) of $73/week applies for the first year of a child’s life (unconditional) and continues to age 3 with separate income testing.
Worked example
Patrick and Kate, family of four in Whakatāne, with two children aged 4 and 7 and combined income of $76,000.
Patrick is a builder; Kate works part-time as an admin officer. Their combined gross income is $76,000. Both children are over 3, so Best Start does not apply.
Maximum FTC for two children: $144 (first child) + $117 (second) = $261/week. Maximum IWTC at the new 1 April 2026 rate: $147.50/week. Combined maximum entitlement: $408.50/week, or $21,242/year.
Family income above the $44,900 threshold: $76,000 − $44,900 = $31,100. Abatement at the new 27.5% rate: $31,100 × 0.275 = $8,553/year, or $164.48/week.
Net weekly entitlement: $408.50 − $164.48 = $244/week, or about $12,690/year. The 1 April 2026 changes (IWTC up $50/week, threshold lifted $2,200, rate up 0.5pp) leave Patrick and Kate’s family roughly $35/week ahead of where they would have been on the old rules.
Things to keep in mind
- 1 April 2026 changes are baked in. Three things changed on 1 April 2026: IWTC rose from $97.50 to $147.50/week per family; the abatement threshold lifted from $42,700 to $44,900; the abatement rate rose from 27% to 27.5%. The calculator uses the new figures throughout.
- IWTC has a work test. A couple needs at least 30 hours of paid work per week between them. A sole parent needs at least 20 hours. Self-employed and contracted hours both count. Long-term beneficiaries usually do not qualify because their main income is a benefit rather than employment.
- <span class="term" tabindex="0" aria-describedby="term-tip-working-for-families">Best Start<span class="term__tip" role="tooltip" id="term-tip-working-for-families"><strong>Working for Families</strong><span class="term__tip-def">Government package of weekly tax credits (FTC, IWTC, MFTC, BSTC) for working families.</span><a href="/glossary/#working-for-families" class="term__tip-link">View in glossary →</a></span></span> is partly unconditional. BSTC pays $73/week for every newborn during their first year regardless of income. From age 1 to 3 it continues, but with its own income test (21 cents per dollar of family income above $79,000). The calculator handles BSTC for children under 3.
- Effective marginal rate above the threshold is high. Above $44,900 of family income, every additional dollar earned loses 27.5 cents of WFF. Combined with the income tax bracket and ACC, working families above the threshold often see effective marginal rates around 50% on each additional dollar earned.
- <span class="term" tabindex="0" aria-describedby="term-tip-ietc">IETC<span class="term__tip" role="tooltip" id="term-tip-ietc"><strong>IETC</strong><span class="term__tip-def">Independent Earner Tax Credit; small annual credit for low-to-mid earners with no Working for Families.</span><a href="/glossary/#ietc" class="term__tip-link">View in glossary →</a></span></span> is separate. The Independent Earner Tax Credit applies to people who do NOT receive WFF and have no children. If your family qualifies for WFF, IETC does not also apply. The calculator treats them as mutually exclusive.
NZ-specific notes
FAQs
Why did the IWTC change in April 2026?
The IWTC was lifted from $97.50/week to $147.50/week as part of the 2025 Budget package, alongside an abatement-threshold increase from $42,700 to $44,900 and an abatement rate rise from 27% to 27.5%. The package was designed to deliver more support to working families with school-age children.
How does the calculator handle Best Start?
BSTC pays $73/week for every newborn during their first year regardless of income. From age 1 to 3 it abates above $79,000 of family income at 21 cents per dollar. If you have a child under 3, the calculator includes BSTC; for children over 3, BSTC does not apply.
What counts as family income?
Combined gross income from both parents (or sole parent) including salary, wages, self-employment income, rental income, interest, and dividends. KiwiSaver employee contributions are not deducted; the figure is gross of KiwiSaver but net of business expenses if you are self-employed.
How is the entitlement paid?
Either weekly or fortnightly into your bank account, or as an annual lump-sum at year-end. Most families take the weekly option; the lump-sum option is useful if income is uneven (commission, contracting) and you would otherwise face a year-end square-up if you were paid too much weekly.
Does the work test apply year-round?
It applies week by week. Working 30 hours one week and 25 the next disqualifies the second week from IWTC. The "work hour" requirement is paid hours, including paid leave and statutory holidays, but not unpaid time off.
What if my income changes mid-year?
WFF estimates are based on your declared annual income at the start of the year. If your actual income ends up higher, IRD recovers the over-payment at year-end. If lower, you receive a top-up. Notifying IRD as soon as income changes (a new job, a redundancy, a partner change) avoids large square-ups.
Are there extra credits for sole parents?
The MFTC tops up working sole parents on very low incomes to $703/week net (about $36,604/year). The work-hour requirement is 20 hours/week for sole parents, lower than the 30-hours/week for couples. Sole parents qualifying for MFTC also receive FTC, IWTC, and BSTC where applicable.
References & sources
- Inland Revenue, "Working for Families overview". ird.govt.nz
- Inland Revenue tax policy, "Increase to the in-work tax credit – information release" (April 2026 changes). ird.govt.nz
- Inland Revenue, "Estimate your entitlement". ird.govt.nz
- Inland Revenue, "Minimum Family Tax Credit". ird.govt.nz