Income Tax Act 2007

Tax credits paid in cash - Minimum family tax credit

ME 1: Minimum family tax credit

You could also call this:

"A tax credit to help families with low incomes"

You can get a tax credit called the minimum family tax credit if you qualify under sections MC 3 to MC 6. The amount of tax credit you get is calculated using a formula. The formula uses your net family scheme income, which is calculated using the formula in section ME 3. You need to know what some words mean to understand the formula. The prescribed amount is $34,216. Net family scheme income is the income of you, your spouse, or partner, or both of you together. The formula also uses the number of weekly periods you are a full-time earner. The amount of the prescribed amount can be increased by the Governor-General using an Order in Council under section MF 7. This section is overridden by section 80KW of the Tax Administration Act 1994.

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View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=DLM1518564.

This page was last updated on 29 January 2026 — View changes

Topics:

Money and consumer rights > Taxes

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Part MTax credits paid in cash
Minimum family tax credit

ME 1Minimum family tax credit

A person who qualifies under sections MC 3 to MC 6 (which relate to the qualifying criteria) is entitled to a tax credit (the minimum family tax credit) for an entitlement period equal to an amount calculated using the formula in subsection (2).
The formula is—
$(prescribed amount − net family scheme income) × weekly periods ÷ 52.$

Where:
In the formula,—
prescribed amount is $34,216:
net family scheme income is the net family scheme income, calculated using the formula in section ME 3, for a relationship period containing the entitlement period, of—
1. the person; or
2. their spouse, civil union partner, or de facto partner; or
3. the person and their spouse, civil union partner, or de facto partner:
weekly periods is the number of periods of 1 week in the entitlement period for which the person is a full-time earner.

In subsection (3)(a), the amount referred to may be increased as prescribed by the Governor-General by Order in Council under section MF 7 (Orders in Council).
This section is overridden by section 80KW of the Tax Administration Act 1994.

Compare

2004 No 35 s KD 3(2)–(5)

Notes

Section ME 1 heading: substituted, on 1 April 2008, by section 480(1) of the Taxation (Business Taxation and Remedial Matters) Act 2007 (2007 No 109).
Section ME 1(1): amended, on 1 April 2008, by section 480(2) of the Taxation (Business Taxation and Remedial Matters) Act 2007 (2007 No 109).
Section ME 1(2) formula: substituted (with effect on 1 April 2008), on 21 December 2010 (applying for the 2008–09 and later income years), by section 113(1) of the Taxation (GST and Remedial Matters) Act 2010 (2010 No 130).
Section ME 1(3)(a): amended, on 1 April 2023, by clause 5(1) (and see clause 5(2) for application) of the Income Tax (Tax Credit) Order 2022 (SL 2022/296).
Section ME 1(3)(b): amended, on 1 April 2008, by section 480(3) of the Taxation (Business Taxation and Remedial Matters) Act 2007 (2007 No 109).
Section ME 1 list of defined terms family tax credit: repealed, on 1 April 2008, by section 480(4)(b) of the Taxation (Business Taxation and Remedial Matters) Act 2007 (2007 No 109).
Section ME 1 list of defined terms minimum family tax credit: inserted, on 1 April 2008, by section 480(4)(a) of the Taxation (Business Taxation and Remedial Matters) Act 2007 (2007 No 109).