Source: Radio New Zealand
Offering fuel support via the Working for Families system may mean some people end up having to pay it back. RNZ / Unsplash
There are concerns that offering fuel support via the Working for Families system may mean some people end up having to pay it back.
The government announced on Tuesday that it would pay households who receive the in-work tax credit an extra $50 a week to help with the rising cost of fuel.
To qualify for that credit, people needed to have at least one child, be in work, not receive a main benefit and earn a household income below the threshold. This year, the cut-off for receiving the tax credit was around $89,000 of annual household income for a family with one child, $112,000 for a family with two children and $135,000 for a family with three children.
But it was not uncommon for people to receive Working for Families payments that they were not entitled to.
Because it was paid based on household income, when a family’s income changed – due to shifting jobs or business income moving – they could end up receiving too much and having to pay it back.
Last year, RNZ covered the case of Phoenix Ruka and his wife who had ended up with about $20,000 in Working for Families debt because Inland Revenue had inaccurate information about their household incomes.
It is something the government acknowledged when it announced a review last year to tackle Working for Families debt – created when people were overpaid.
Inland Revenue’s discussion document said in the 2022 year, only 24 percent of households receiving weekly or fortnightly payments who were squared up by IRD at the end of the year had received the right amount of Working for Families credits. The document noted that in June 2024, 56,800 recipients accounted for $273.5 million of Working for Families debt.
Baqir Hassan, of Finex Chartered Accountants said he was concerned about what that could mean for the extra $50 a week being paid.
He recommended people update their income estimate as early as possible if their situation changed.
Inland Revenue said it would monitor all customers receiving Working for Families payments to ensure they were getting what they were entitled to.
“We are reliant on customers giving us updates if their family circumstances change. An assessment is done at the end of every year to square up what they estimated their income would be and what they actually received and if they received more than they were entitled to they would be assessed to pay it back.”
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– Published by EveningReport.nz and AsiaPacificReport.nz, see: MIL OSI in partnership with Radio New Zealand
