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The Families Package - what does it mean for your employees?

The Families Package - what does it mean for your employees?

The Families Package is a collection of changes aimed at assisting New Zealand families and helping children get the best start in life. These changes come into effect on 1 July 2018.

The Families Package includes a number of changes:

  • the introduction of the Best Start tax credit, and
  • the expansion of Working for Families tax credits and Paid Parental Leave.

What is a Best Start tax credit?

Best Start is a new weekly payment of $60 per child (up to $3,120 per year), available to eligible parents who have a baby due on or after 1 July 2018.

All families receive this payment until the child turns 1, no matter what the household income is. Families with a household income of less than $79,000 will continue to receive $60 a week until the child turns 3. Those earning above this amount may continue to receive payments at a reduced amount. The upper threshold is $94,000 (for one child) when payments stop.

If you have an employee on parental leave and they return to work before their child’s first birthday, they will still receive Best Start payments until their child turns 1.

For those who receive Paid Parental Leave, Best Start payments will begin once paid parental leave finishes.

If the child is cared for under a shared care arrangement, the amount the primary caregiver receives will be apportioned according to their arrangement.

How to apply

If you have any employees due on or after 1 July 2018, they will be able to apply through the SmartStart website when they register their baby’s birth:

Alternatively, they can apply by completing the Working for Families Tax Credits registration (FS1) form either online, or by hand and posting it to us.

Changes to Paid Parental Leave

Paid parental leave is extending from 18 weeks up to a maximum of 22 weeks for parents with:

  • babies born or expected on or after 1 July, or
  • children under the age of 6 coming into their care on or after 1 July.

This also means the number of 'keeping in touch' hours is increasing from 40 hours to 52 hours.

Changes to Working for Families

The payment rate and eligible income range for Working for Families is also changing. There will be higher payment rates and widening of the eligible income range.
Find out more >>


Source: www.ird.govt.nz