Treatment of NZ Working for Families payments for Australian tax resident

 Author: JayATO(Community Support)Community Support

13 Feb 2026

Hi @Accountant4life,

New Zealand Working for Families payments received by an Australian tax resident are generally assessable income in Australia. As an Australian resident for tax purposes, your client needs to declare their worldwide income, including foreign social assistance payments, even if those payments are tax-free in the country where they were received.

The Australian tax system doesn't automatically exempt foreign social welfare payments in the same way it treats Australian Family Tax Benefit. While Australian Family Tax Benefit is exempt from tax in Australia, this exemption doesn't extend to equivalent foreign payments unless a specific exemption applies under Australian tax law.

Your client should include the Working for Families payments as assessable income at question 20 of the supplementary tax return under 'Other foreign income'. The amounts need to be converted to Australian dollars before including them in the return. You can use the foreign income conversion calculator on our website for this purpose.

Because no New Zealand tax was withheld from these payments, your client won't be entitled to claim a foreign income tax offset for these amounts. However, the foreign income may still affect the overall tax calculation, as foreign income that's exempt from Australian tax can be taken into account when working out the amount of tax payable on other income.

Given the specific nature of this situation and the comparison to Australian Family Tax Benefit, you may want to contact us directly for confirmation on whether any specific exemption applies to these payments. This will ensure your client's tax return correctly reflects their obligations.