Child benefit
Child benefit or children's allowance is a social security payment which is distributed to the parents or guardians of children, teenagers and in some cases, young adults. Countries operate different versions of the benefit. In most child benefit is means-tested and the amount paid is usually dependent on the number of children.
Conditions for payment[edit]
A number of conditional cash transfer programs in Latin America and Africa link payment to the receivers' actions, such as enrolling children into schools, and health check-ups and vaccinations.[1] In the UK, in 2011 CentreForum proposed an additional child benefit dependent on parenting activities.[2]
Australia[edit]
In Australia, Child benefit payments are currently called Family Tax Benefit. Family Tax Benefit is income tested and is linked to the Australian Income tax system. It can be claimed as fortnightly payments or as an annual lump sum. It may be payable for dependant children from birth up to the age of 24. Children 16 years or older may alternatively be eligible for Youth Allowance. Parents of dependant children under the age of 16 may also be eligible for Income Support Payments including Parenting Payment and Newstart Allowance for Primary Carers of Children.
On 1 July 2000 the Australian government introduced major changes to the tax system including the introduction of a broad-based Goods and Service Tax (a VAT), substantial income tax cuts, as well as major changes to assistance for families.
These changes to family assistance simplified payments, by amalgamating a number of different forms of assistance, and also provided higher levels of assistance, with reductions in income test withdrawal rates. The new structure combined twelve of the pre-existing types of assistance into three new programs of assistance. The two most important of these are Family Tax Benefit Part A, which assists with the general costs of raising children, and Family Tax Benefit Part B, which is directed to single income and sole parent families. The third programme is Child Care Benefit.
The Family Tax Benefit Part A is paid for dependent children up to 20 years of age, and for dependent full-time students up to the age of 24 (who are not getting Youth Allowance or similar payments such as ABSTUDY and Veterans' Children Education Supplement). It is essentially a two-tier but integrated payment directed to most families with children, with a higher rate for lower income families, including both those in work and receiving income support.
The maximum rate is paid up to a family income of $28,200, and is then reduced by 30 cents for every extra dollar of income, until the minimum rate is reached. Part-payment at the minimum rate is available up to a family income of $73,000 (plus an additional $3,000 for each dependent child after the first). Payments are then reduced by 30 cents in every dollar over that amount until the payment reaches nil.
To receive some Family Tax Benefit Part A, the maximum income levels are $76,256 a year for a family with one dependent child under 18 and $77,355 a year for a family with one dependent 18- to 24-year-old. These thresholds are lifted by $6,257 for each additional dependent child under 18 and $7,356 for each additional dependent 18- to 24-year-old.
Families receiving Family Tax Benefit Part A may also be eligible for extra payments, such as Rent Assistance if renting privately, the Large Family Supplement for four or more children, and Multiple Birth Allowance for three or more children born during the same birth.
Family Tax Benefit Part B provides extra assistance to single income families including sole parents - particularly families with children under 5 years of age. In a couple, if the secondary earner's income is above $1,616 a year, payments are reduced by 30 cents for every extra dollar of income. Parents receive therefore some Family Tax Benefit Part B if the secondary earner's income is below $10,416 a year if the youngest child is under 5 years of age, or $7,786 a year if the youngest child is between 5 and 18 years of age. There is no income test on the primary earner's income, so in the case of sole parents the payment is universal.
The previous entry referred to Youth allowance and Parenting Payment. These are income support payments for young people and for parents who are not employed and looking after children respectively.[3]
The Canada child benefit (CCB) is a tax-free monthly payment made to eligible families to help them with the cost of raising children under 18 years of age.[4] Basic benefit for July 2019 to June 2020 is calculated as:[5]
This amount is reduced for families with adjusted family net income (AFNI) over $31,120, based on AFNI and the number of children.
Luxembourg[edit]
Family allowance[edit]
The government, through the Caisse pour l'avenir des enfants (Children's Future Fund), pays €271.66 per month per child. The allowance is universal and is not means-tested.[12]
When a child is 6 years old, the amount increases to €292.19 per month.
When a child is 12 years old, the amount increases to €322.91 per month.
The family allowance is paid until the child is 18, unless they continue in education, in which case it is paid until the adult child ceases being enrolled at an educational institution or is 25 years old, whichever happens first.
New Zealand[edit]
New Zealand has a tax rebate system known as 'Working For Families', which are allocated to families based on income and the number of children. A report in 2012 by the children's commissioner Dr Russell Wills recommended New Zealand adopt a universal child benefit, which the-then National government rejected.[17]
In 2018, the Sixth Labour Government introduced a new universal BestStart Payment of $60 per week for parents with newborn dependents.[18]
Poland[edit]
There are two forms of parents financial support.
The first one is tax cut. It was introduced in early 2000s. One of parents can deduct it from their annual personal tax settlement.
Currently it is PLN 92,67 (€19) monthly for first and second child, PLN 166,67 (€35) for the third and PLN 225 (€47) for each next child.
There is no possibility to use it when parents are not subject for personal income tax in basic form (e.g. that excludes some alternative forms of taxation in small business). There is also an income limitation if there is only a single child. The limit is PLN 56,000 (€11,700) per year per each parent. The tax cut is possible for parents of children up to 25 years provided that the child learns at school and child’s annual income does not exceed a small limit (close to PLN 16,000, €3340 monthly).
Another form is direct payment for parents. The program has been introduced in 2016 and initially was only for parents of more than one child. The benefit base was a number of children minus one. Later on in 2019 it's been simplified and made more common: the benefit is paid for each child. From the very beginning the rate is constant and is PLN 800 (€189) monthly per child. The payment is not a subject of any income tax (e.g. cannot increase your income to excess the limit mentioned in above paragraph) and is paid unconditionally for children up to 18 years.
There is no research that proves any birth rate increase due to any of these forms of support.
South Korea[edit]
As of May 2021, any Korean family with a child aged between 0-7 receives 100,000 won per month in cash transferred to the parent's bank account from the Korean government, regardless of income or wealth. Finally, a debit card prepaid with 600,000 won is issued by the government to anyone pregnant or with a child in the country, which can be used for medical checks and initial upbringing costs. From January 2022, this debit card will be prepaid with an increased amount of 1 million won by the government.
From January 2022, 2 million won will be immediately paid to anyone giving their first birth in South Korea and the cash can be used for any purpose on top of receiving all of the various aforementioned benefits. 3 million won will be given for the second and further child. In addition, the additional bonus cash given to newborn babies aged 0-11 months will be raised to 1,000,000 won per month, and babies aged 12-23 months will receive 500,000 per month. Each parent will receive a paid holiday of up to 3 million won per month each for 3 consecutive months. Low income families who have a third child will have their children's university education fully paid for free by the Korean government.[20]