Working for Families Abatement Calculator NZ

This Working for Families abatement calculator shows you how your family tax credits shrink as your family income climbs above the income threshold set by Inland Revenue. Working for Families is a package of payments that tops up the income of families raising children, and the main entitlement is reduced, or abated, once your combined family income passes the threshold of $44,900 from the 2026 tax year. Above that point your full entitlement is cut by 27.5 cents for every extra dollar you earn, so a modest pay rise can claw back a meaningful slice of your credits. To use the tool, enter your total family income for the year and the base entitlement you would receive at or below the threshold, then read off your abated entitlement and the dollar amount of abatement applied. Families, sole parents and accountants use this to sanity check what Inland Revenue pays during the year and to forecast a square up at year end. A few good habits help. Keep your income estimate with Inland Revenue up to date so you are not overpaid and left with a bill, count all taxable income including PAYE wages, self employed profit and rental income, and remember that this is the abatement step only, not your full entitlement calculation. The actual base entitlement depends on the number and age of your children and which credits you qualify for, so treat the figure here as a clear guide to how income reduces what you keep, then confirm the detail with Inland Revenue before you rely on it.

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$3,348
Abated entitlement
Abatement applied$4,153
Income over threshold$15,100

Abatement = (family income - threshold) x 27.5%. Entitlement = base - abatement, floored at $0. Estimate only, not financial or tax advice.

How it works

Income over the threshold is your family income minus $44,900. That excess is multiplied by the 27.5 percent abatement rate to give the abatement amount. The abated entitlement is your base entitlement less the abatement, and it cannot fall below zero.

Worked example

With family income of $60,000 the excess over the $44,900 threshold is $15,100. Multiplied by 27.5 percent that is $4,152.50 of abatement. Taking that off a $7,500 base entitlement leaves $3,347.50.

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Data sources: the rates and thresholds on this page are maintained against Inland Revenue. Figures are checked twice monthly.

Frequently asked questions

What is the Working for Families abatement rate?

From the 2026 tax year, family tax credits abate at 27.5 cents in the dollar on family income above the threshold of $44,900. That means every extra $100 of family income reduces your entitlement by $27.50 until it reaches zero.

What income counts towards the threshold?

Inland Revenue uses your family scheme income, which includes wages, self employed income, most benefits and other taxable income for you and your partner. Keeping this estimate accurate during the year helps you avoid an end of year bill.

Is this my full Working for Families entitlement?

No. This tool shows only how income abates a base entitlement you enter. Your actual base depends on the number and ages of your children and the credits you qualify for, so confirm the full figure with Inland Revenue.