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. A number of countries operate different versions of the program. In most countries, child benefit is means-tested and the amount of child benefit paid is usually dependent on the number of children one has.
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]
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]
Canada
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]
6,639 CAD per year (553.25 CAD per month) for each eligible child under the age of 6.
5,602 CAD per year (466.83 CAD per month) for each eligible child aged 6 to 17.
This amount is reduced for families with adjusted family net income (AFNI) over $31,120, based on AFNI and the number of children.
Finland
Child benefit scheme was introduced to Finland in 1948 by law. Since the 1920s there was a child benefit allowance that covered state workers with children. In 1948 this benefit became universal following the example of other Nordic countries. Benefit is paid for children until they turn 17, and it is only paid for children that live in Finland. There is also a supplement for single parents. Benefit is paid through national Finnish Social Insurance institution (KELA). Åland has a different scheme.
Child benefit allowances in Finland starting from 1.3. 2011. (Increase of 0,4% from 2010)
1. child
100,40 €/month
2. child
110,94 €/month
3. child
141,56 €/month
4. child
162,15 €/month
following children
182,73 €/month
Single parents supplement for every child 46,79 euros.
Hungary
In Hungary there are several forms of family support. Every person who has a work permit and lives permanently in Hungary is eligible for almost all of them.
Family allowance
One of them is called family allowance (Hungarian: családi pótlék) which is corresponding to the social program in other countries under the name child benefit. Its amount depends on the number of children. For families with one child it is 12,200 HUF, for families with two children 13,300 HUF and for families with three or more children it is 16,000 HUF per child per month. For single parents (parents who are raising their children alone) the amount of family allowance is 1,500 HUF more in the first and second categories and 1,000 HUF more in the third category. Family allowance is paid until the age of 18 or to the completion of secondary education.[6] For children with disability the amount is 23,300 HUF and for disabled children of single parents it is 25,900 HUF.[7]
Number of children
Monthly amount pro child for one parent in double parent household
Monthly amount pro child for single parent household
1 child
12,200 HUF (32.49 €)
13,700 HUF (36.48 €)
2 children
13,300 HUF (35.41 €)
14,800 HUF (39.41 €)
3 or more children
16,000 HUF (42.60 €)
17,000 HUF (45.27 €)
If the child misses more than 50 school hours without permission, the family allowance will be suspended until the child re-fulfills his/her school attendance obligation properly. In the case of pre-school age children, family allowance will be suspended in case of an unjustified absence exceeding 20 days of education.[8]
According to some sources the government plans to raise the child benefit. However, there has been no official declaration on the issue.[6]
Family tax benefit
The other one is called family tax benefit (Hungarian: családi adókedvezmény) which is a tax reduction for families according to the number of children living in the household. Its amount can be maximal 10,000 HUF for parents with one child, 15,000 HUF for parents with two children and 33,000 HUF for parents with three or more children per month. There are no differences between single and double households or between families with one or two parents employed.[9]
Number of children
Monthly maximal tax saving pro child for one parent
1 child
10,000 HUF (26.63 €)
2 children
20,000 HUF (53.25 €)
3 or more children
33,000 HUF (79.88 €)
People get family allowance and family tax benefit at the same time, so it is also common to count them together as a kind of child benefit.
Ireland
Child Benefit (Sochar Leanaí) is payable to parents of children under 16 years of age, or under 18 years of age if they are in full-time education, Youthreach training or has a disability. The payment is paid by the Department of Social Protection. The monthly payments are as follows:[10]
Number of children
Monthly rate
Per child
€140.00
Multiple births are a special case. In the event of twins, 150% of the monthly payment is paid for each child. Triplets, or more, are paid the double (200%) rate each; provided that all of them remain qualified (i.e. stay in further education until 19). In addition, a special 'once-off' grant of €635 is paid on all multiple births. Further 'once-off' grants of €635 are paid when the children are 4 and 12 years old respectively.[10]
Fraudulent claims of Child Benefit are treated very seriously, and can result in large fines or prison for up to 3 years.[11]
The Luxembourg 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 turns 6 years old, the amount increases to €292.19 per month.
When a child turns 12 years old, the amount increases to €322.91 per month.
The family allowance is paid until the child turns 18, unless they continue in education, in which case it is paid until the adult child ceases being enrolled at an educational institution or turns 25 years old, whichever comes first.
Supplement for disabled children
The family allowance amount is increased by €200 per month for children who have a permanent disability causing them to lose at least 50% of their physical or mental capacity in comparison to a child of the same age with no disabilities.[13]
Back-to-school allowance
In addition to the family allowance, a lump-sum back-to-school allowance is paid once a year in August for every child aged 6 or over enrolled at a primary or secondary school or college.[12]
The allowance is €115 every August per child over 6 years old and under 12 years old.
The allowance is €235 every August per child over 12 years old until their schooling comes to an end.
Netherlands
The Netherlands has one of the lowest child benefits (Dutch: kinderbijslag) in Western Europe. [14]
In 2021, the amount per child per month is: 74.46 euros for children aged 0 to 5 years; 80.41 euros for children aged 6 to 11 years; 106.37 euros per month for children from 12 to 17 years.
In comparison to Netherlands, its neighbour Germany pays 3 times more per month with lower income tax.
Kindgebonden budget
In addition to these general child benefits, there's a benefit depending on household income. For a household income up to 70.000 (single) or 99.000 (two parents), the "kindgebonden budget" is (2021)[15] up to:
Number of children
Monthly maximal kgb
1 child
100.33 €
2 children
185.50 €
3 children
262.08 €
Additional children
76.58 €
Inkomensafhankelijke combinatiekorting
If a household has a child less than 12 years of age and the parent with the lowest income has an income of more than 5.154 euro per year (2021), he or she receives a tax deduction of up to 2.815 euro per year (234,58 per month, 2021).[16]
New Zealand
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
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 500 (€104) 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.
Spain
Between 2007 and 2010, Spain provided unconditional cash transfers to new mothers.[19] The policy substantially increased the birth rate in Spain.[19]
South Korea
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. In addition, newborn babies aged 0 receive an additional bonus of 200,000 won per month in cash on top of the 100,000 won per month standard child benefit. At age 1, this bonus drops to 150,000 won per month. 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 birth in South Korea and the cash can be used for any purpose on top of receiving all of the various aforementioned benefits. In addition, the additional bonus cash given to newborn babies aged 0-1 will be raised to 300,000 won per month. This will be continuously increased every year to reach 500,000 won per month by 2025. 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]
The minimum wage was introduced in Great Britain in 1909 for certain low-wage industries and expanded to numerous industries, including farm labour, by 1920. However, by the 1920s, family allowance targeted at low-income families was an alternative method, suggested by reformers, to relieve poverty without distorting the labour market.[21][22] The trade unions and the Labour Party adopted this view. In 1945, family allowances were introduced; minimum wages faded from view. Talk resumed in the 1970s, but in the 1980s the Thatcher ministry made it clear it would not accept a national minimum wage. Eventually with the return of Labour to power, the National Minimum Wage Act 1998 set a minimum wage of £3.60 per hour, with lower rates for younger workers. It largely affected workers in high-turnover service industries such as fast-food restaurants, and people from ethnic minority backgrounds.[23]
The system was first implemented in August 1946 as "family allowances" under the Family Allowances Act 1945, at a rate of 5s (=£0.25) per week per child in a family, except for the eldest. This was raised from September 1952, by the Family Allowances and National Insurance Act 1952, to 8s (=£0.40), and from October 1956, by the Family Allowances Act and National Insurance Act 1956, to 8s for the second child with 10s (=£0.50) for the third and subsequent children.
By 1955, some 5,000,000 allowances were being paid, to about 3,250,000 families.[24]
It was modified in 1977, with the payments being termed "child benefit" and given for the eldest child as well as the younger ones; by 1979 it was worth £4 per child per week. In 1991, the system was further altered, with a higher payment now given for the first child than for their younger siblings. In October 2010, the Conservative-Liberal Democrat coalition government announced that Child Benefit would be withdrawn from households containing a higher-rate taxpayer from January 2013.[25] After some controversy, this was amended so that any household with at least one person with prescribed income over £50,000 would lose Child Benefit by a taper which removed it altogether when the income reached £60,000. This came into force on 7 January 2013.[26]
Today, child benefit is administered by His Majesty's Revenue and Customs (HMRC). As of April 2023, this is £24 per week for the first child (including the eldest of a multiple birth) and £15.90 per week for each additional child.[27]
Map of monthly rate of child benefit in various European states for one, two and three non-disabled children raised by two parents (See description of map to more explanation.)
1 2 The purpose of child benefits in Germany is to ensure that the subsistence level for a child is not taxed as required by the constitution. Therefore, child benefits are comparably high. When the taxes on the subsistence levels are deducted, an average of 50 euros per child remains, depending on the parent's income and taxation level. For low-level incomes, savings are highest; the level out around a taxable income of around 70,000 euros when there are 3 children.
1 2 3 Belgium has supplements depending on the social status of a parent (retired, unemployed, invalid). Parents receive benefits until the child reaches the age of 25, as long as the child is enrolled in higher education.
1 2 Amount depends on Canton and number of children.
Unemployment benefits, also called unemployment insurance, unemployment payment, unemployment compensation, or simply unemployment, are payments made by authorized bodies to unemployed people. In the United States, benefits are funded by a compulsory governmental insurance system, not taxes on individual citizens. Depending on the jurisdiction and the status of the person, those sums may be small, covering only basic needs, or may compensate the lost time proportionally to the previous earned salary.
Social security in Sweden is an aspect of the Swedish welfare system and consists of various social insurances handled by the National Agency for Social Insurance, and welfare provided based on need by local municipalities. Social security is the main conduit for redistribution of approximately 48% of the Swedish GDP in the form of taxed income.
A child tax credit (CTC) is a tax credit for parents with dependent children given by various countries. The credit is often linked to the number of dependent children a taxpayer has and sometimes the taxpayer's income level. For example, with the Child Tax Credit in the United States, only families making less than $400,000 per year may claim the full CTC. Similarly, in the United Kingdom, the tax credit is only available for families making less than £42,000 per year.
The Canada Child Benefit (CCB), previously the Canada Child Tax Benefit (CCTB), is an income-tested income support program for Canadian families. It is delivered as a tax-free monthly payment available to eligible Canadian families to help with the cost of raising children. The CCTB could incorporate the National Child Benefit (NCB), a monthly benefit for low-income families with children, and the Child Disability Benefit (CDB), a monthly benefit for families caring for children with severe and prolonged mental or physical disabilities.
Working Tax Credit (WTC) is a state benefit in the United Kingdom made to people who work and have a low income. It was introduced in April 2003 and is a means-tested benefit. Despite their name, tax credits are not to be confused with tax credits linked to a person's tax bill, because they are used to top-up wages. Unlike most other benefits, it is paid by HM Revenue and Customs (HMRC).
In 2004, the New Zealand Labour government introduced the Working for Families package as part of the 2004 budget. The package, which effectively commenced operating on 1 April 2005, had three primary aims: to make work pay; to ensure income adequacy; and to support people "into work".
Income Support is an income-related benefit in the United Kingdom for some people who are on a low income, but have a reason for not actively seeking work. Claimants of Income Support may be entitled to certain other benefits, for example, Housing Benefit, Council Tax Reduction, Child Benefit, Carer's Allowance, Child Tax Credit and help with health costs. A person with capital over £16,000 cannot get Income Support, and savings over £6,000 affect how much Income Support can be received. Claimants must be between 16 and Pension Credit age, work fewer than 16 hours a week, and have a reason why they are not actively seeking work.
Social welfare has long been an important part of New Zealand society and a significant political issue. It is concerned with the provision by the state of benefits and services. Together with fiscal welfare and occupational welfare, it makes up the social policy of New Zealand. Social welfare is mostly funded through general taxation. Since the 1980s welfare has been provided on the basis of need; the exception is universal superannuation.
Elterngeld is a tax-financed payment for couples which pays an amount of money to support the costs of bringing up a child. Elterngeld schemes exists in Germany, France, and Scandinavia.
Social security, in Australia, refers to a system of social welfare payments provided by Australian Government to eligible Australian citizens, permanent residents, and limited international visitors. These payments are almost always administered by Centrelink, a program of Services Australia. In Australia, most payments are means tested.
A baby bonus is a government payment to parents of a newborn baby or adopted child to assist with the costs of childrearing.
Social security or welfare in Finland is very comprehensive compared to what almost all other countries provide. In the late 1980s, Finland had one of the world's most advanced welfare systems, which guaranteed decent living conditions to all Finns. Created almost entirely during the first three decades after World War II, the social security system was an outgrowth of the traditional Nordic belief that the state is not inherently hostile to the well-being of its citizens and can intervene benevolently on their behalf. According to some social historians, the basis of this belief was a relatively benign history that had allowed the gradual emergence of a free and independent peasantry in the Nordic countries and had curtailed the dominance of the nobility and the subsequent formation of a powerful right wing. Finland's history was harsher than the histories of the other Nordic countries but didn't prevent the country from following their path of social development.
Social security in Germany is codified on the Sozialgesetzbuch (SGB), or the "Social Code", contains 12 main parts, including the following,
Child benefits in the United Kingdom are a series of welfare payments and tax credits made to parents with children in the UK, a major part of the welfare state.
Taxation in Hungary is levied by both national and local governments. Tax revenue in Hungary stood at 38.4% of GDP in 2017. The most important revenue sources include the income tax, Social security, corporate tax and the value added tax, which are all applied at the national level. Among the total tax income the ratio of local taxes is solely 5% while the EU average is 30%.
Welfare in Israel refers to the series of social welfare schemes in the Israeli government which are administered by the Ministry of Social Affairs and Social Services, and by Israel's national social security agency, Bituah Leumi. All residents of Israel must pay insurance contributions in order to qualify for welfare.
Social Security Scotland is an executive agency of the Scottish Government with responsibility for social security provision.
Family policy in Hungary refers to the government measures that have been passed to increase Hungary's birth rate and to stop the decline of the country's population. Hungary has family policy that seeks to subsidize childcare for new parents.
Elterngeld is a transfer payment dependent on net income as compensation for concrete disadvantages in the early phase of starting a family and thus a parent-related, temporary compensation payment. The parental allowance replaces the previous child-raising allowance. Parents who are not or not fully employed due to the care of a child or who interrupt their employment for the care of their child are entitled to parental benefit. It is intended to support parents in securing their livelihood and is therefore designed as a compensation payment.
The United States federal child tax credit (CTC) is a partially-refundable tax credit for parents with dependent children. It provides $2,000 in tax relief per qualifying child, with up to $1,400 of that refundable (subject to a refundability threshold, phase-in and phase-out). In 2021, following the passage of the American Rescue Plan Act of 2021, it was temporarily raised to $3,600 per child under the age of 6 and $3,000 per child between the ages of 6 and 17; it was also made fully-refundable and half was paid out as monthly benefits. This reverted back to the previous in 2022. The CTC is scheduled to revert to a $1,000 credit after 2025.
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