Budget Priorities Baby Bonus The Baby Bonus provides further tax relief to families. It will be available to parents of a child born on or after 1 July 2001. Families can receive up to a maximum of $2,500 each year until the child turns five. There will be a minimum of $500 each year for parents with annual incomes of $25,000 or less.
one of the hardest times for families financially can be the birth of a first child		The Baby Bonus is a refundable tax offset that recognises that one of the hardest times for families financially can be the birth of a first child. This is a time where one parent often gives up or reduces paid employment to care for the child.
available to children born on or after 1 July 2001		The Baby Bonus will be available for first children born on or after 1 July 2001. However, as a transitional measure, it also will apply to a child born on or after 1 July 2001 for families who already have children. Parents adopting or otherwise gaining legal custody of a first child may also be eligible.
families may receive up to $2,500 per year for up to five years		Every year for up to five years, a parent will be able to claim up to $2,500 of the tax payable on their income earned in the year prior to the birth of their child. Claims can be made in tax returns lodged from 1 July 2002.
a guaranteed $500 per year for parents with incomes below $25,000		A minimum annual payment of $500 will be available to a parent with an annual income of $25,000 or less in the year they claim the Baby Bonus. This will ensure that low-income families will benefit from the measure.
if the mother returns to work, she may transfer the Baby Bonus to her spouse		The Baby Bonus will generally be paid to the mother. If she returns to work part time, she will still be eligible for the Baby Bonus, but the entitlement will be reduced in proportion to the income she earns. Where the mother returns to work and the father stays home to take care of the child, the benefit will be able to be transferred to him. A father with sole legal responsibility for the care of a child may also be eligible.
it will benefit some 600,000 families		It is expected that around 245,000 mothers and their families will benefit from the Baby Bonus in the first year and eventually it will deliver benefits to some 600,000 families at any one time.