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Income Tax Act 2007

Tax credits paid in cash - Payment of credits

MF 7: Orders in Council

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“Governor-General can adjust tax credits through official orders”

The Governor-General can make changes to certain tax credits and related amounts through Orders in Council. Here’s what you need to know:

  • The Governor-General can increase amounts for the family tax credit, in-work tax credit, minimum family tax credit, and Best Start tax credit.

  • These increases are based on changes in the Consumers Price Index (all groups).

  • For the family tax credit and Best Start tax credit, increases must be made when there’s been a 5% or more increase in the Consumers Price Index since the last adjustment.

  • The Governor-General can also change the income threshold for abatement of the Best Start tax credit.

  • These Orders must be published by 1 December each year and apply from the following 1 April.

  • The Ministers responsible for Inland Revenue and Social Security must review the amounts of the in-work tax credit at least every three years.

  • ‘Consumers Price Index (all groups)’ means the index published by Statistics New Zealand or an equivalent measure certified by the Government Statistician.

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View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=DLM1518597.

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Money and consumer rights > Taxes
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Part M Tax credits paid in cash
Payment of credits

MF 7Orders in Council

  1. The Governor-General may, by Order in Council,—

  2. increase the amounts in section MD 3(4)(a) and (b) (Calculation of family tax credit) by amounts that—
    1. correspond to the movement in the Consumers Price Index (all groups) after the quarter ended with 30 September 2021 that has not yet been taken into account by an increase:
      1. are rounded up to the nearest whole dollar, without affecting the calculation of later increases made under this paragraph:
        1. increase the amounts appearing as items in the formula for the in-work tax credit set out in section MD 10(3) (Calculation of in-work tax credit):
            1. increase the amounts appearing as the amount of the threshold set out in section MD 13(3):
              1. increase the amount appearing as an item in the formula for the minimum family tax credit in section ME 1(3) (Minimum family tax credit):
                1. change the amounts in section MG 2(2)(a) (Best Start tax credit) by an amount that—
                  1. corresponds to the movement in the Consumers Price Index (all groups) after the quarter ended with 30 September 2021 that has not yet been taken into account by an increase:
                    1. is rounded up to the nearest whole dollar, without affecting the calculation of later increases made under this paragraph:
                    2. change the amounts in section MG 3(2)(a) (Best Start tax credit abatement):
                      1. replace schedule 31 (Annualised equivalent amount for Part M).

                        1. An Order in Council under subsection (1)(a),—

                          1. in the case of the first Order in Council made under subsection (1)(a) after the date on which the Taxation (COVID-19 Support Payments and Working for Families Tax Credits) Act 2021 receives the Royal assent, must be made when the total percentage increase in the movement in the Consumers Price Index (all groups) measured from that applying on 1 October 2021 is 5% or more:
                            1. in the case of a subsequent Order in Council under subsection (1)(a), must be made when the total percentage increase in the movement in the Consumers Price Index (all groups) measured from that applying on the date when the requirement to make the immediately preceding adjustment arose is 5% or more.

                              1. An Order in Council under subsection (1)(db),—

                              2. in the case of the first Order in Council made under subsection (1)(db) after the date on which the Taxation (COVID-19 Support Payments and Working for Families Tax Credits) Act 2021 receives the Royal assent, must be made when the total percentage increase in the movement in the Consumers Price Index (all groups) measured from that applying on 1 October 2021 is 5% or more:
                                1. in the case of a subsequent Order in Council under subsection (1)(db), must be made when the total percentage increase in the movement in the Consumers Price Index (all groups) measured from that applying on the date when the requirement to make the immediately preceding adjustment arose is 5% or more.

                                  1. For the purposes of subsections (1)(a)(i) and (db)(i), (2), and (2BA), a movement in the Consumers Price Index (all groups) over a period is determined by comparing the following numbers:

                                  2. the number that, when the period started, was the most recent quarterly index number of the Consumers Price Index (all groups):
                                    1. the number that, when the period ended, was the most recent quarterly index number of the Consumers Price Index (all groups).

                                      1. Repealed

                                      2. An Order in Council made under this section must be published under the Legislation Act 2019 no later than 1 December in each year and must apply from 1 April following that date.

                                      3. An Order in Council under this section is secondary legislation (see Part 3 of the Legislation Act 2019 for publication requirements).

                                      4. The Minister responsible for the Inland Revenue Department, in consultation with the Minister responsible for the department currently responsible for administering the Social Security Act 2018, must cause a review to be undertaken of the amounts of the in-work tax credit allowable under subparts MB to MF and MZ.

                                      5. A review undertaken under subsection (4) must occur,—

                                      6. in the case of the first review, not later than 30 June 2008; and
                                        1. in the case of subsequent reviews, not later than 30 June in the third year after each preceding review.

                                          1. In this section, Consumers Price Index (all groups) means the Consumers Price Index (all groups) published by Statistics New Zealand or, if that index ceases to be published, any measure certified by the Government Statistician as being equivalent to that index.

                                          Compare
                                          Notes
                                          • Section MF 7(1)(a): amended (with effect on 1 July 2018), on , by section 241(1) of the Taxation (Annual Rates for 2018–19, Modernising Tax Administration, and Remedial Matters) Act 2019 (2019 No 5).
                                          • Section MF 7(1)(a): amended, on , by section 6(1) of the Taxation (Annual Rates and Budget Measures) Act 2011 (2011 No 23).
                                          • Section MF 7(1)(a): amended (with effect on 20 May 2010), on , by section 94(1) of the Taxation (Budget Measures) Act 2010 (2010 No 27).
                                          • Section MF 7(1)(a): amended, on , by section 489(1) of the Taxation (Business Taxation and Remedial Matters) Act 2007 (2007 No 109).
                                          • Section MF 7(1)(a)(i): replaced, on , by section 13(1) of the Taxation (COVID-19 Support Payments and Working for Families Tax Credits) Act 2021 (2021 No 52).
                                          • Section MF 7(1)(a)(i): amended, on , by section 107(1) of the Data and Statistics Act 2022 (2022 No 39).
                                          • Section MF 7(1)(ab): repealed (with effect on 1 July 2018), on , by section 241(2) of the Taxation (Annual Rates for 2018–19, Modernising Tax Administration, and Remedial Matters) Act 2019 (2019 No 5).
                                          • Section MF 7(1)(b): amended, on , by section 489(2) of the Taxation (Business Taxation and Remedial Matters) Act 2007 (2007 No 109).
                                          • Section MF 7(1)(c): repealed, on , by section 123(1) of the Taxation (Annual Rates for 2020–21, Feasibility Expenditure, and Remedial Matters) Act 2021 (2021 No 8).
                                          • Section MF 7(1)(cb): inserted (with effect on 20 May 2010), on , by section 94(3) of the Taxation (Budget Measures) Act 2010 (2010 No 27).
                                          • Section MF 7(1)(d): amended, on , by section 489(3) of the Taxation (Business Taxation and Remedial Matters) Act 2007 (2007 No 109).
                                          • Section MF 7(1)(db): inserted, on , by section 21(1) of the Families Package (Income Tax and Benefits) Act 2017 (2017 No 51).
                                          • Section MF 7(1)(db)(i): replaced, on , by section 13(2) of the Taxation (COVID-19 Support Payments and Working for Families Tax Credits) Act 2021 (2021 No 52).
                                          • Section MF 7(1)(db)(i): amended, on , by section 107(1) of the Data and Statistics Act 2022 (2022 No 39).
                                          • Section MF 7(1)(dc): inserted, on , by section 21(1) of the Families Package (Income Tax and Benefits) Act 2017 (2017 No 51).
                                          • Section MF 7(2)(a): repealed, on , by section 13(3) of the Taxation (COVID-19 Support Payments and Working for Families Tax Credits) Act 2021 (2021 No 52).
                                          • Section MF 7(2)(b): replaced, on , by section 13(3) of the Taxation (COVID-19 Support Payments and Working for Families Tax Credits) Act 2021 (2021 No 52).
                                          • Section MF 7(2)(b): amended, on , by section 107(1) of the Data and Statistics Act 2022 (2022 No 39).
                                          • Section MF 7(2)(c): inserted, on , by section 56(2) (and see section 56(4) for application) of the Families Package (Income Tax and Benefits) Act 2017 (2017 No 51).
                                          • Section MF 7(2)(c): amended, on , by section 107(1) of the Data and Statistics Act 2022 (2022 No 39).
                                          • Section MF 7(2BA) heading: inserted, on , by section 21(2) of the Families Package (Income Tax and Benefits) Act 2017 (2017 No 51).
                                          • Section MF 7(2BA): inserted, on , by section 21(2) of the Families Package (Income Tax and Benefits) Act 2017 (2017 No 51).
                                          • Section MF 7(2BA)(a): replaced, on , by section 13(4) of the Taxation (COVID-19 Support Payments and Working for Families Tax Credits) Act 2021 (2021 No 52).
                                          • Section MF 7(2BA)(a): amended, on , by section 107(1) of the Data and Statistics Act 2022 (2022 No 39).
                                          • Section MF 7(2BA)(b): amended, on , by section 107(1) of the Data and Statistics Act 2022 (2022 No 39).
                                          • Section MF 7(2B) heading: replaced, on , by section 56(3) (and see section 56(4) for application) of the Families Package (Income Tax and Benefits) Act 2017 (2017 No 51).
                                          • Section MF 7(2B): replaced, on , by section 56(3) (and see section 56(4) for application) of the Families Package (Income Tax and Benefits) Act 2017 (2017 No 51).
                                          • Section MF 7(2B): amended, on , by section 107(1) of the Data and Statistics Act 2022 (2022 No 39).
                                          • Section MF 7(2B): amended, on , by section 21(3) of the Families Package (Income Tax and Benefits) Act 2017 (2017 No 51).
                                          • Section MF 7(2B)(a): replaced, on , by section 13(5) of the Taxation (COVID-19 Support Payments and Working for Families Tax Credits) Act 2021 (2021 No 52).
                                          • Section MF 7(2B)(a): amended, on , by section 107(1) of the Data and Statistics Act 2022 (2022 No 39).
                                          • Section MF 7(2B)(b): replaced, on , by section 13(5) of the Taxation (COVID-19 Support Payments and Working for Families Tax Credits) Act 2021 (2021 No 52).
                                          • Section MF 7(2B)(b): amended, on , by section 107(1) of the Data and Statistics Act 2022 (2022 No 39).
                                          • Section MF 7(2C) heading: repealed (with effect on 1 July 2018), on , pursuant to section 241(3) of the Taxation (Annual Rates for 2018–19, Modernising Tax Administration, and Remedial Matters) Act 2019 (2019 No 5).
                                          • Section MF 7(2C): repealed (with effect on 1 July 2018), on , by section 241(3) of the Taxation (Annual Rates for 2018–19, Modernising Tax Administration, and Remedial Matters) Act 2019 (2019 No 5).
                                          • Section MF 7(3): amended, on , by section 3 of the Secondary Legislation Act 2021 (2021 No 7).
                                          • Section MF 7(3B) heading: inserted, on , by section 3 of the Secondary Legislation Act 2021 (2021 No 7).
                                          • Section MF 7(3B): inserted, on , by section 3 of the Secondary Legislation Act 2021 (2021 No 7).
                                          • Section MF 7(4) heading: amended, on , by section 123(2) of the Taxation (Annual Rates for 2020–21, Feasibility Expenditure, and Remedial Matters) Act 2021 (2021 No 8).
                                          • Section MF 7(4) heading: amended, on , by section 489(4) of the Taxation (Business Taxation and Remedial Matters) Act 2007 (2007 No 109).
                                          • Section MF 7(4): amended, on , by section 123(3) of the Taxation (Annual Rates for 2020–21, Feasibility Expenditure, and Remedial Matters) Act 2021 (2021 No 8).
                                          • Section MF 7(4): amended, on , by section 459 of the Social Security Act 2018 (2018 No 32).
                                          • Section MF 7(4): amended, on , by section 489(5) of the Taxation (Business Taxation and Remedial Matters) Act 2007 (2007 No 109).
                                          • Section MF 7(6) heading: inserted, on , by section 107(1) of the Data and Statistics Act 2022 (2022 No 39).
                                          • Section MF 7(6): inserted, on , by section 107(1) of the Data and Statistics Act 2022 (2022 No 39).
                                          • Section MF 7 list of defined terms family support: repealed, on , by section 489(6)(b) of the Taxation (Business Taxation and Remedial Matters) Act 2007 (2007 No 109).
                                          • Section MF 7 list of defined terms in-work payment: repealed, on , by section 489(6)(b) of the Taxation (Business Taxation and Remedial Matters) Act 2007 (2007 No 109).
                                          • Section MF 7 list of defined terms in-work tax credit: inserted, on , by section 489(6)(a) of the Taxation (Business Taxation and Remedial Matters) Act 2007 (2007 No 109).
                                          • Section MF 7 list of defined terms minimum family tax credit: inserted, on , by section 489(6)(a) of the Taxation (Business Taxation and Remedial Matters) Act 2007 (2007 No 109).
                                          • Section MF 7 list of defined terms parental tax credit: repealed, on , by section 123(4) of the Taxation (Annual Rates for 2020–21, Feasibility Expenditure, and Remedial Matters) Act 2021 (2021 No 8).
                                          • Section MF 7 list of defined terms quarter: inserted, on , by section 13(6) of the Taxation (COVID-19 Support Payments and Working for Families Tax Credits) Act 2021 (2021 No 52).