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MF 4J: Calculation of instalments: 1 April 2024 to 30 July 2024
or “How to work out your tax credit payments from April to July 2024”
You could also call this:

“How to work out your tax credit payments from July 2024 to March 2025”

This section explains how you calculate tax credit instalments from 31 July 2024 to 31 March 2025. It applies to the Abating WFF tax credit and the Minimum family tax credit.

For the in-work tax credit, you use a formula: (amount A + amount B × (children − 3)) × weekly periods ÷ 52. Amount A is $5,070 and amount B is $780. ‘Children’ is either 3 or the number of children you’re allowed the in-work tax credit for, whichever is higher. ‘Weekly periods’ is the number of whole weeks you or your partner have income from work.

For the minimum family tax credit, you use a different formula: (prescribed amount − net family scheme income) × weekly periods ÷ 52. The prescribed amount is $35,316. Net family scheme income is calculated using the formula in section ME 3. ‘Weekly periods’ is the number of weeks you’re a full-time earner during the entitlement period.

These formulas help work out how much tax credit you should get in each instalment during this time period.

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Next up: MF 5: Recovery of overpaid tax credit

or “Getting back extra tax credit money you shouldn't have received”
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Part M Tax credits paid in cash
Payment of credits

MF 4KCalculation of instalments: 31 July 2024 to 31 March 2025

  1. This section applies for calculating the amount of an instalment by way of tax credit under section MD 1 (Abating WFF tax credit) or, as applicable, sections MD 1 and ME 1 (Minimum family tax credit) for the period starting on 31 July 2024 and finishing on 31 March 2025.

  2. The instalments for the relevant tax credit are calculated using, for the calculation of the in-work tax credit, the formula—

    (amount A + amount B × (children − 3)) × weekly periods ÷ 52.

    Where:

    • In the formula in subsection (2),—

    • amount A is $5,070:
      1. amount B is $780:
        1. children is the greater of—
          1. 3; and
            1. the number of children for whom the person is allowed the in-work tax credit:
            2. weekly periods,—
              1. for 2 or more entitlement periods forming 1 continuous period, is the number of whole periods of 1 week in the continuous period for which the person or their spouse, civil union partner, or de facto partner has, from the work activity, income to which section MD 9(2) (Fifth requirement: earner) refers or is an earner described in section MD 9(1)(b), and includes whole periods of 1 week to which the alternative requirement in section MD 9(6) applies:
                1. for an entitlement period to which subparagraph (i) does not apply, is the number of whole periods of 1 week in the entitlement period for which the person or their spouse, civil union partner, or de facto partner has, from the work activity, income to which section MD 9(2) refers or is an earner described in section MD 9(1)(b), and includes whole periods of 1 week to which the alternative requirement in section MD 9(6) applies.

                2. The instalments for the relevant tax credit are calculated using, for the calculation of the minimum family tax credit, the formula—

                  (prescribed amount − net family scheme income) × weekly periods ÷ 52.

                  Where:

                  • In the formula in subsection (4),—

                  • prescribed amount is $35,316:
                    1. net family scheme income is the net family scheme income, calculated using the formula in section ME 3 (Meaning of net family scheme income), for a relationship period containing the entitlement period, of—
                      1. the person; or
                        1. their spouse, civil union partner, or de facto partner; or
                          1. the person and their spouse, civil union partner, or de facto partner:
                          2. weekly periods is the number of periods of 1 week in the entitlement period for which the person is a full-time earner.

                            Notes
                            • Section MF 4K: inserted (with effect on 1 April 2024), on , by section 5 of the Taxation (Budget Measures) Act 2024 (2024 No 19).