If you receive the Families Package (formerly the Family Incomes Package), you may be affected by three changes coming on 1 July 2018. They include:
- a Winter Energy Payment to help older people and low income families heat their homes
- a Best Start tax credit for families with young children
- increases to Working for Families tax credits
Because the changes will be made automatically, you don’t need to do anything. Anyone who isn’t a Work and Income client may need to apply for Best Start tax credit through Inland Revenue.
Boosting Working for Families tax credits
From 1 July 2018 the eldest-child rate will increase to $5,878 a year, and for subsequent children to $4,745. The abatement threshold will increase from $36,350 to $42,700, and the abatement rate from 22.5% to 25%. This means that the amount of the family’s income at which Working for Families tax credits starts reducing is increased, however the amount of the reduction has increased from 22.5c in the dollar to 25c in the dollar. The result is net increase to families receiving Working for Families tax credits.
The Best Start payment of $3,120 a year (or $60 a week) per child is designed to help families meet costs in a child’s early years. It will be available to all families in their child’s first year and for low- and middle-income families in the child’s second and third years. Best Start payments will be abated at 21% for income above $79,000. It will be made available for children born after June 30 and will replace the Parental Tax Credit.
Winter Energy Payment
The Winter Energy Payment is aimed at helping people on a benefit, New Zealand Superannuation or a Veteran’s Pension to heat their homes in winter. It provides $20.46 a week for single people, and $31.82 a week for couples or people with dependent children. It will be paid from 1 July to 30 September 2018.