Income Tax Act 2007

Tax credits paid in cash - Best Start tax credit

MG 2: Best Start tax credit

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"Help with money for families with young children"

You get a Best Start tax credit for a dependent child. The credit is calculated using a formula: $3,838 multiplied by the number of days, then divided by 365. You continue to get the credit for 4 weeks after the child dies if you meet the requirements of section MG 1(1). The amount of the credit may change as prescribed by the Governor-General. If the child spends time in the care of another person, your credit is reduced. This reduction is based on the time the child spends with the other person. The credit is affected by rules in other parts of the law, such as section MF 7 and section MC 2. You can find more information about these rules in the relevant sections of the law. The rules about the Best Start tax credit are part of the Income Tax Act 2007.

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View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=LMS63785.

This page was last updated on 5 April 2026 — View changes

Topics:

Money and consumer rights > TaxesFamily and relationships > Children and parenting

MG 1: Best Start tax credit entitlement, or

"Who can get the Best Start tax credit and how it's calculated"

MG 3: Best Start credit abatement, or

"How the Best Start tax credit may be reduced based on family income"

Part MTax credits paid in cash
Best Start tax credit

MG 2Best Start tax credit

For the purposes of section MG 1(3)(a), the person’s Best Start tax credit for the entitlement period for the dependent child is calculated using the formula—
$prescribed amount × days ÷ 365.$

Where:
In the formula,—
prescribed amount is, for the dependent child, $3,838:
days is the number of days in the entitlement period.

The person continues to be entitled to the Best Start tax credit for 4 weeks after the dependent child dies, if the person otherwise meets the requirements of section MG 1(1).
The amount in subsection (2)(a) may be changed as prescribed by the Governor-General by Order in Council under section MF 7 (Orders in Council).
A Best Start tax credit must be reduced in proportion to the time in the entitlement period that the dependent child spends in the exclusive care of another person who qualifies under section MC 2 (Who qualifies for entitlements under family scheme?).

Notes

Section MG 2: inserted, on 1 July 2018, by section 22 of the Families Package (Income Tax and Benefits) Act 2017 (2017 No 51).
Section MG 2(2)(a): amended, on 1 April 2024, by clause 5(1) (and see clause 5(2) for application) of the Income Tax (Tax Credit) Order 2023 (SL 2023/288).