Working for Families is a collective term for several tax credits paid to families with dependent children. Working for Families tax credits are designed to help make it easier for people to work and raise a family.
You can download Working for Families data from the 2001 to 2021 tax years from the link at the bottom of the page. Working for Families data for the 2019 and 2020 tax years has been revised.
The data is collected from the tax year entitlements as assessed on individuals’ income tax returns. The data is then supplemented with Working for Families data recorded on the PAYE returns of Work and Income clients.
On 1 July 2018 the Best Start Tax Credit (BSTC) was introduced. This tax credit is available to all qualifying families with a baby in their first year, and to families with infants from 1 years old until their third birthday on an abated basis – meaning that from 1 years old until their third birthday the amount paid depends on the family’s circumstances. A family is no longer eligible once their child turns 3, but they will have a part-year entitlement in that tax year.
BSTC data in the table and graphs includes families administered by Inland Revenue and clients of Work and Income. For Work and Income clients that received BSTC but did not receive a Working for Families end of year assessment from Inland Revenue, Inland Revenue has estimated their BSTC entitlement using administrative data held on file. The methodology change has been retrospectively applied to the 2019 and 2020 tax years. The previously published tables for 2019 and 2020 had BSTC of Work and Income clients included within the Family tax credit total.The following abbreviations are used for the tables and graphs below:
- Family tax credit (FTC)
- In-work tax credit (IWTC)
- Minimum family tax credit (MFTC)
- Best Start Tax Credit (BSTC)
Credits no longer available
- Child tax credit (CTC)
- Parental tax credit (PTC)
This graph shows the total number of families claiming and entitled to Working for Families tax credits between the 2001 and 2021 tax years. In these graphs and tables, the definition of a family with Working for Families tax credits includes families that have claimed any Working for Families tax credit, and their year-end assessment, if any, confirms an entitlement for that year.
The number of families with Working for Families tax credits increased from 300,100 in the 2001 tax year to 421,200 in the 2011 tax year. This followed changes to the Working for Families tax credit entitlements during this period.
The number of families claiming and entitled to Working for Families tax credits then decreased to 322,900 by the 2018 tax year. The decline reflected growth in family income over the period as entitlements are ended once family income exceeds a threshold. Following the introduction of BSTC and changes to the FTC entitlements on 1 July 2018, the number of families claiming and entitled to Working for Families tax credits increased to 350,600 in the 2020 tax year. In the 2021 tax year, 345,300 families claimed and were entitled to Working for Families tax credits, down 1.6% on the previous year.
The table below outlines the number of families claiming and entitled to Working for Families tax credits by type from the 2018 to 2021 tax years.
|Working for Families tax credit||Tax year|
1 The 'Total' column is the total number of families that received any Working for Families credit. This total is lower than all other columns combined as some families receive multiple payment types.
BSTC has been operating since 1 July 2018 and it is expected to take between 3 to 4 years before maximum eligibility for the tax credit is reached. The number of eligible families for the BSTC has increased to 112,300 in the 2021 tax year as families receiving BSTC now include children aged from birth to two years old (but not yet three years old, at which point eligibility ceases). We anticipate that the number of families with the BSTC credit will increase again in the 2022 tax year, at which point maximum eligibility for the tax credit based on will have been reached.
This graph shows the average amount of Working for Families tax credits a family was entitled to between the 2001 and 2021 tax years.
The average Family tax credit entitlement has increased 144% from $3,075 in the 2001 tax year to $7,516 in the 2021 tax year. The average total combined Working for Families tax credit entitlement has increased 139% from $3,456 in the 2001 tax year to $8,259 in the 2021 tax year.
The table below outlines the average entitlement each family received from the 2018 to 2021 tax years. The values in the table represent the average amount received for a family if they were eligible for that tax credit. For example, 3,100 families received an average MFTC amount of $3,349 in the 2018 tax year.
|Working for Families tax credit||Tax year|
|Average per family||$6,931||$7,923||$8,253||$8,257|
This graph shows the aggregate entitlements paid for Working for Families tax credits between 2001 and 2021.
The aggregate entitlement paid has increased from $1.03 billion in the 2001 tax year to $2.86 billion in the 2021 tax year following changes in the Working for Family tax credit amounts and the types of tax credits available over the period. Growth in the aggregate entitlements paid since the 2018 tax year arise from the launch of the BSTC on 1 July 2018 and an increase in the FTC entitlement from 1 July 2018.
The table below outlines the aggregate entitlement from 2018 to 2021 tax years.
|Working For Families tax credit||Tax year|