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Income Tax Act 2007

Tax credits paid in cash - Best Start tax credit

MG 2: Best Start tax credit

You could also call this:

“Financial support for families with young children”

You can get a Best Start tax credit for your dependent child. The amount you get is based on a formula. The formula multiplies $3,838 by the number of days in your entitlement period, then divides that by 365.

If your child dies, you can still get the Best Start tax credit for 4 more weeks if you meet the other requirements.

The amount of $3,838 might change if the Governor-General makes a new rule about it.

Your Best Start tax credit might be less if your child spends some time in the exclusive care of another person who qualifies for family scheme entitlements.

If you share care of your child with someone else who also qualifies for family scheme entitlements, your Best Start tax credit will be reduced based on how much time the child spends with that other person.

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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.

Topics:
Money and consumer rights > Taxes
Family and relationships > Children and parenting
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MG 1: Best Start tax credit entitlement, or

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

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MG 3: Best Start credit abatement, or

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

Part M Tax credits paid in cash
Best Start tax credit

MG 2Best Start tax credit

  1. 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:
      1. days is the number of days in the entitlement period.

        1. 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).

        2. 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).

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