Newborn Supplement and FTB: What New Parents Need to Know

Welcoming a new baby is an exciting but financially demanding time. The Australian government provides special support for new parents through the Newborn Supplement and Newborn Upfront Payment, which work alongside Family Tax Benefit to help with the costs of caring for a newborn. Understanding these payments can help you plan for your new arrival with confidence.

What is the Newborn Supplement?

The Newborn Supplement is an additional payment made to eligible families for the first 13 weeks after a new child enters their care. It's designed to help with the extra costs of caring for a new baby or newly adopted child, recognising that this period involves significant expenses for items like nursery equipment, clothing, and baby supplies.

The payment is made as part of your Family Tax Benefit Part A. You'll receive an increased FTB Part A rate for the first 13 weeks, after which your payment reverts to the standard rate for a child in that age group. The Newborn Supplement is an alternative to Parental Leave Pay—if you receive Parental Leave Pay, you won't receive the Newborn Supplement.

Newborn Upfront Payment

Alongside the Newborn Supplement, eligible families receive the Newborn Upfront Payment—a one-off lump sum payment to help with immediate costs when a new baby arrives. This payment is made shortly after you claim FTB for your new child and helps cover those initial expenses that can't wait.

The Newborn Upfront Payment is currently around $587 for first children and $553 for subsequent children. Like the Newborn Supplement, it's only available to families who don't receive Parental Leave Pay. This creates a choice point for many families: take employer-paid parental leave with Parental Leave Pay, or opt for the Newborn Supplement and Newborn Upfront Payment.

Who is Eligible for These Payments?

To receive the Newborn Supplement and Newborn Upfront Payment, you must be eligible for FTB Part A (more than the base rate) and not receiving Parental Leave Pay for that child. You must also care for the child from birth or within 13 weeks of the child entering your care (for example, through adoption or foster care).

Income limits apply through the FTB Part A income test. If your family income is high enough that you only receive the base rate of FTB Part A, you won't receive the Newborn Supplement. However, the income limits are quite generous, and most families with moderate incomes will qualify.

Both parents can be assessed for these payments, but only one can receive them for each child. Generally, the parent who claims FTB for the newborn will receive these additional payments. If you share care with another parent from birth, the entitlement may be split based on care percentages.

Newborn Supplement vs Parental Leave Pay

One of the most common questions new parents have is whether to choose Parental Leave Pay or the Newborn Supplement. Parental Leave Pay provides up to 18 weeks of payment at the national minimum wage (currently around $882 per week before tax), totaling approximately $15,876. The Newborn Supplement provides significantly less—around $1,709 for a first child over 13 weeks.

For most working parents, Parental Leave Pay is the better financial choice. However, the Newborn Supplement may be more suitable if you don't meet the Parental Leave Pay work test requirements, if you're a stay-at-home parent, or if you have specific circumstances that make the supplement more valuable for your situation.

It's important to note that you cannot receive both—if you receive even one day of Parental Leave Pay, you're ineligible for the Newborn Supplement and Newborn Upfront Payment. Plan carefully before making your claim.

Claiming FTB for Your Newborn

You can claim FTB for your newborn as soon as the birth is registered. In most hospitals, you'll be given paperwork to register the birth, which automatically triggers your eligibility for FTB. You can also claim online through myGov once you have your child's birth certificate or proof of birth.

If you're already receiving FTB for other children, you can add your newborn to your existing claim. The new child will be included in your FTB Part A calculation, and you'll receive the Newborn Supplement and Newborn Upfront Payment if eligible. Your Part B payment won't change, as it's calculated per family rather than per child.

The sooner you claim, the sooner your payments start. While FTB can be backdated in some circumstances, it's best to lodge your claim as soon as possible after birth. This ensures you don't miss out on any entitlements, including the time-limited Newborn Supplement.

FTB Rates for Newborns

Newborns (aged 0-4) attract the base FTB Part A rate of $187.08 per fortnight at maximum. During the first 13 weeks, this is supplemented by the Newborn Supplement if you're eligible, bringing the total payment higher. After 13 weeks, the rate returns to the standard amount for a child in that age group.

Remember that these rates are subject to the income test. If your family income exceeds the free area of $56,898, your FTB Part A (including the Newborn Supplement portion) will be reduced. However, the Newborn Upfront Payment is a one-off amount not affected by the ongoing income test once you've established eligibility.

Planning for a New Baby

If you're expecting a baby, now is the time to plan your government support. Consider whether you'll be eligible for Parental Leave Pay based on your work history and income. If so, decide whether this or the Newborn Supplement is better for your circumstances. Most families benefit from Parental Leave Pay, but your situation may be different.

Use the time before birth to gather the information you'll need for your FTB claim. This includes your and your partner's income details, tax file numbers, and any documentation related to your housing situation if you'll be claiming Rent Assistance. Having everything ready means you can claim quickly after the birth.

Also consider how your income might change during parental leave. If one parent reduces or stops work, this could affect your FTB entitlement—potentially increasing it due to lower family income. Update your income estimate with Services Australia to ensure your payments reflect your actual situation.

Multiple Births

If you're expecting twins or higher-order multiples, you'll receive FTB Part A for each baby. The Newborn Supplement is also paid for each child, and you'll receive a separate Newborn Upfront Payment for each baby. This can provide substantial support for families facing the unique costs of multiple births.

For multiple births, the Newborn Upfront Payment is generally $553 per child (the subsequent child rate), with the first child receiving $587. The total Newborn Supplement over 13 weeks is calculated for each child based on their birth order. Families with multiples may want to consult Services Australia for specific calculations.

Adoption and Foster Care

The Newborn Supplement and Newborn Upfront Payment aren't just for birth parents. If a child enters your care through adoption, permanent care orders, or foster care, you may be eligible for these payments. The child must enter your care within 13 weeks of birth to qualify for the full Newborn Supplement period.

For older children entering your care, you won't receive the Newborn Supplement, but you will receive standard FTB Part A based on the child's age. Adoptive parents may also be eligible for Parental Leave Pay if they meet the work test requirements, providing similar support to birth parents.

Welcoming a new baby is a joyful time, and understanding the financial support available can help ease the transition. Whether you choose Parental Leave Pay or the Newborn Supplement, combining these with ongoing Family Tax Benefit payments provides a foundation of support for your growing family.