Plain language law

New Zealand law explained for everyone

Income Tax Act 2007

Tax credits paid in cash - FamilyBoost tax credits

MH 3: FamilyBoost tax credit

You could also call this:

“Tax credit for people paying for early childhood services”

You can get a tax credit called the FamilyBoost tax credit if you’re looking after children who go to an early childhood service. This credit is for people who pay fees for their kids to attend these services. You need to be living in New Zealand to get it.

The amount you can get is 25% of what you pay in fees for the early childhood service, up to $975 every three months. But if you earn more than $35,000 in those three months, you might get less.

To get the money, you need to ask for a refund. Before you can do this, you (and your partner if you have one) must have sent in your tax returns on time.

If you have a partner, only one of you can get the FamilyBoost tax credit, even if you both pay for the childcare.

If someone who was supposed to get the FamilyBoost tax credit dies before they can ask for it, the person looking after their money (called a trustee) can ask for it instead.

If you and your partner split up, and you don’t have a new partner by the end of the three months, you can both apply for the credit separately.

You can find out more about how to ask for this refund in section 41C of the Tax Administration Act 1994. The rules about when you need to send in your tax returns are in section 37 of the same Act.

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View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=LMS976041.

Topics:
Money and consumer rights > Taxes
Family and relationships > Children and parenting
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MH 2: Some definitions, or

“Definitions for understanding the FamilyBoost tax credit”

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MH 4: Meaning of tax credit income, or

“How your income is calculated to determine FamilyBoost tax credit eligibility”

Part M Tax credits paid in cash
FamilyBoost tax credits

MH 3FamilyBoost tax credit

  1. A natural person is entitled to a tax credit, the FamilyBoost tax credit, for a quarter for the amount calculated under subsections (2) and (3) if, during that quarter, the person—

  2. is a caregiver of one or more children enrolled with a licensed early childhood service; and
    1. incurs licensed early childhood service fees for that child or children; and
      1. is resident in New Zealand.

        1. Subject to subsection (3), the FamilyBoost tax credit for the quarter is equal to 25% of the licensed early childhood service fees payable by the person for the quarter up to a maximum credit amount of $975.

        2. If the person’s tax credit income for the quarter is greater than $35,000, the FamilyBoost tax credit for the quarter is the lesser of—

        3. the amount of the FamilyBoost tax credit determined under subsection (2); and
          1. $975 less the abatement amount.

            1. A person entitled to a FamilyBoost tax credit for a quarter may apply for a refund of that credit under section 41C of the Tax Administration Act 1994 if—

            2. the person has met their obligation to file a return of income by the dates set out in section 37 of the Tax Administration Act 1994; and
              1. the person’s spouse, civil union partner, or de facto partner (partner), if applicable, has also met their obligation to file a return of income by the dates set out in section 37 of the Tax Administration Act 1994.

                1. If a person entitled to a FamilyBoost tax credit under subsection (1) has a partner, that partner is not also entitled to a FamilyBoost tax credit for the quarter, regardless of whether the licensed early childhood service fees are incurred by both the person and their partner.

                2. Despite subsection (4), where a person entitled to a FamilyBoost tax credit dies before applying for a refund of that credit, the trustee of that person’s estate may apply for a refund of the FamilyBoost tax credit to which the deceased person was entitled under subsection (1) as if they were that person.

                3. Subsection (5) does not apply for a quarter if the person is separated from their partner and does not have a new partner at the end of the quarter.

                Notes
                • Section MH 3: inserted, on , by section 14 of the Taxation (Budget Measures) Act 2024 (2024 No 19).